2020 (9) TMI 1012

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....nd circumstances of the case, Ld. CIT(A) has erred in directing the AO to allow the Short Term Capital Loss of Rs. 5,70,328/-. 4. That in the facts and circumstances of the case, Ld. CIT(A) in violation of Rule 46A of the Income Tax Rules, 1962,accepted the arguments and fresh evidence in the form of paper book from the assessee without seeking any remand report from the Assessing Officer to give comments. 3. At the outset, it is noticed that there is delay by 51 days in filing the impugned appeal. After going through the petition for condonation of delay ( 51 days) we are of the opinion that there are reasonable grounds/reasons to justify the delay caused. Therefore, we condone the delay and proceed to adjudicate the appeal on merits. 4. We note that ground no. 4 of revenue is against the action of the Ld. CIT(A) for passing the impugned order in violation of Rule 46 of the Income Tax Rules, 1962 (hereinafter referred to as the 'Rules'), wherein the Ld. CIT(A) according to Revenue had admitted fresh evidences in the form of paper book from the assessee without seeking any remand report from the AO. When we asked Smt. Ranu Biswas, Addl. CIT/Learned Departmental Repre....

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....d loss on future trading totaling to Rs. 53,03,486/- was on account of speculation activity and, therefore, the loss cannot be allowed to be set off along with saving bank interest of Rs. 21,961/-. On appeal, the Ld. CIT(A) based on evidence, found that the assessee indulged in trading of derivatives through M/s. Suvridh Capital Markets Ltd and M/s. India Nivesh Securities Pvt. Ltd, and since both entities were registered brokers on the portal of the NSE (National Stock Exchange) and the transaction happened through Screen Based Trading System, he allowed the claim of assessee. This fact of assessee transacting through registered broker and through screen based trading system on the portal of NSE is a finding of fact recorded by the Ld. CIT(A), which fact is clear at page- 6, para 9 of the impugned order of the Ld. CIT(A), which has not been challenged by the Revenue before us. Therefore, we find that this trading in commodity has been done by the assessee in consonance with the Notification No. 2/2006 [so 89 (E), dated 25-1-2006, which reads as under:- Notification No. 2/2006 [ so 89 ( E ) dated 25-1-2006 In exercise of the powers conferred by clause (ii) in the ....

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.... eligible transaction, it cannot be termed as 'speculative transaction'. Since the Revenue has not challenged the finding of fact on this issue by the Ld. CIT(A) that the commodity have taken place through registered broker on the portal of the NSE through screen based trading system, the finding of fact crystalizes and therefore, as per law the action of Ld. CIT(A) is correct and we find no infirmity in the impugned order of the Ld. CIT(A) in allowing the same as business loss. 9. Coming to the contention of the AO that the assessee has filed his return of income u/s. 139(4) on 26-09-2012, belatedly because the assessee was an individual and his accounts need not be audited u/s. 44AB of the Act and so the assessee had to file his return on 31-07-2012 and not belatedly on 26-09-2012, and therefore, the loss suffered by the assessee cannot be allowed to be carried forward in the assessment year 2012-13 i.e under consideration. We note that in this respect the AO misdirected himself and fell in error as rightly noted by the Ld. CIT(A). According to the threshold limit as per section 44AB of the Act in this assessment year was of Rs. 60 lakhs and as per section 44AB of the Act the ....

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....t he received the said amount from his elder brother, Sh. G.R.Poddar, who is settled in Singapore, and he has given money/loan to the assessee for purchase of flat & business, however, the assessee failed to show that he had utilized the said loan for purchase of flat. Therefore, the AO added an amount of Rs. 1,88,75,000/- u/s. 68 of the Act. 12. On appeal, the ld. CIT(A) noted that the assessee had taken the said loan from his elder brother, Shri G.R Poddar, who is settled/resided in Singapore and he maintains an NRE account with UCO Bank, Burra Bazar, Kolkata (A/c No. 1734010000605) and HDFC Bank Ltd, C.R Avenue Branch, Kolkata (A/c No. 1924101000012). The Ld. CIT(A) found that the assessee has proved the identity of Shri G.R. Poddar (Gobnindram Poddar) by filing a copy of his passport as well as confirmation of account, which the AO himself has accepted that the assessee had filed copy of the passport to prove the identity of Sh.G.R Poddar. The Ld. CIT(A) has made a finding of fact that all the loans have been received from the said bank accounts. The Ld. CIT(A) also noted that the assessee had made payments worth of Rs. 17,11,888/- to M/s. Emami Realty against purchase of fl....