TaxTMI 
TaxTMI 
TaxTMI 
2020 (1) TMI 909
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....ng Officer was justified in treating the income at Rs. 1,74,10,040/- declared by the appellant, as unexplained credit u/s 68 of the Income Tax as per para 3.8 of his order. b). That the Ld. Assessing Officer has erred in not considering that in fact, the income of Rs. 1,74,10,040/- has been declared by the appellant as miscellaneous income in the profit and loss account on account of profit earned from commodity transactions as stated by the Ld. CIT (A) in para 3.6 of his order and not unexplained credit u/s 68 as stated above. 3. That the Ld. CIT(A) has also erred in holding that the Assessing Officer was justified in not allowing the set off of the loss from business, against the so called unexplained income u/s 68 as per para 3.9 of his order. 4. That the Ld. CIT(A) has erred in treating the miscellaneous income declared in the profit and loss account on account of sale and purchase of commodity transactions as unexplained income u/s 68 of the Income Tax Act merely for not producing the brokers before the Assessing Officer. 5. That the Ld. CIT (A) has erred in not considering and ignoring the fact that sufficient evidence has been filed to prove the identity of the broke....
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....e said income of Rs. 1,74,10,040./- against the current year business losses. He, separately assessed the aforesaid income of Rs. 1,74,10,040/- u/s 68 of the Act and created the impugned tax demand. In appeal, the Ld. CIT(A) confirmed the additions made by the Assessing Officer. 4. Before us, the Ld. Counsel for the assessee has submitted that the assessee had produced before the Assessing Officer all the relevant necessary evidences to show that the assessee had earned income of Rs. 1,74,10,040/- form commodity trading. That the details of the brokers through whom the assessee made transactions of purchase / sales of metal (commodity) were furnished. That there were two brokers through whom the transactions had been done by the assessee namely (i) Shri Kuber Trading Company Ludhiana and (ii) Kashmir Trading Company, and further submitted the copies of the accounts of the said brokers in the assessee's account. The Ld. Counsel for the assessee has submitted that to establish the identity of the aforesaid brokers, the assessee furnished the following details:- "During the relevant year, the commodity profit has been earned through two brokers namely Shree Kuber Trading Company an....
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....rden to prove the identity of the brokers and genuineness of the transactions. That even the names and other details of the parties with whom the transactions were carried out were also supplied. He, therefore, has submitted that there was no justification on the part of the Assessing Officer to separately assess the income of the assessee from commodity transactions u/s 68 of the Act and not allowing the set off of the same against the business loss of the assessee. 6. The Ld. DR, on the other hand, has relied on the findings of the lower authorities. 7. We have considered the rival contentions. The Ld. AR of the assessee has demonstrated from the records that all the requisite details were submitted to the Assessing Officer to prove the genuineness of the transactions entered into by the assessee in commodity trading activity. In our view, merely because the brokers had not appeared in response to the summons sent by the Assessing Officer that itself cannot be the sole ground to reject the entire evidence produced by the assessee. The assessee not only furnished the names and addresses of the brokers and the other concerned parties but also the other details like their PAN num....
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....ll be allowed to the assessee under any provisions of the Act in computing the income referred to in section 115BBE(1) of the Act. 2. In this regard, it has been brought to the notice of the Central Board of Direct Taxes(the Board) that in assessments prior to assessment year 2017-18, while some of the Assessing Officers have allowed set off of losses against the additions made by them under Section(s) 68/69/69A/69B/69C/69D, in some cases, set off of losses against the additions made under Section 115BBE(1) of the Act have not been allowed. As the amendment inserting the words 'or set off of any loss' is applicable with effect from 1st of April, 2017 and applies from assessment year 2017-18 onwards, conflicting views have been taken by the Assessing Officers in assessments for years prior to assessment year 2017-18. The matter has been referred to the Board so that a consistent approach is adopted by the Assessing Officers while applying provision of section 115BBE in assessments for period prior to the assessment year 2017-18. 3. The Board has examined the matter. The Circular No. 3/2017 of the Board dated 20th January, 2017 which contains Explanatory notes to the prov....