TaxTMI 
TaxTMI 
2020 (1) TMI 1018
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....void of merit as such deserves to be quashed in limine. 2. For that, the estimation of income of trading transaction in derivatives U/s 44AD without accepting the returned loss, converting a loss into estimated profit not only is unjustified on the facts and in the circumstances of the case as contrary to legislative intentions but also, unwarranted as per the statutory provisions and the loss from trading transaction in derivatives deserves to be well recognized, accepted and has to be allowed. 3.For that, disallowance of set off of business loss U/s 71 is unjustified and unwarranted and devoid of any merit, being legitimate set off allowed by statute, deserves to be allowed in Toto." 3. The facts in brief are that the....
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....d copy of consolidated ledger from broker, all bank statement (Uco Bank, SBI, ICICI and IOB) and certified gain & loss statement from broker and reply to show cause notice and explaining every query raised in relation to loss, were submitted before the Assessing Officer. 7. Replying to above, ld DR submitted that since the assessee has not maintained books of accounts, the estimation done by the lower authorities is correct. 8. Heard the rival submissions and perused the record of the case. In this case, the assessee, in the relevant assessment year, was in the trading transactions in derivatives of Rs. 30,00,098/- but has not maintained books of account u/s.44AD of the Act. Therefore, the Assessing Officer estimated the profit @ 8% o....
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....ITAT Delhi 'B' Bench in the case of ITO vs Felex Enterprises Pvt Ltd in ITA No.5129/Del/2012 for Asst.Year: 2007-08 and submitted that speculation loss from derivative transaction should be adjusted against profit by applying section 43(5)(c) & (d) instead of section 73 r.w.s 73(1) of the Act. He also drew my attention towards relevant last para at page 4 of the order and submitted that the loss incurred on account of transaction in share futures on a recognized stock exchange is normal business loss and same cannot be treated as speculative loss. Ld A.R. also drew my attention towards page 3 of the paper book and submitted that this kind of loss statement has been issued by Portfolio Manager doing transaction on behalf of the assessee, whe....
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....ered by ITAT Delhi in the case of Felex Enterprises Pvt Ltd (supra), I direct the Assessing Officer that the amount of Rs. 22,30,251.19 should be allowed to the assessee as normal business loss. Hence, Ground No.2 of the assessee is allowed. 14. Apropos Ground No.3 of the appeal, ld counsel submitted that the Assessing Officer has denied set off of business loss being legitimate set off allowed by the statute. Therefore, same may kindly be allowed. Ld counsel submitted that since the transaction carried out by the assessee is a non-speculative transaction, provisions of section 43(5) of the Act is not attracted to the facts of the instant case and likewise the assessee was trading in derivatives and not in shares, so the loss suffered by....