2021 (6) TMI 457

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.... dated 19/01/2015 by the ld. DCIT (1)(3)(2), Mumbai (hereinafter referred to as ld. AO). 2. The Revenue has raised the following grounds:- "1. Whether on the facts and in the circumstances of the case and in law, the Id. CIT(A) erred in allowing the loss of Rs. 627,41/471/- derived on currency derivative transaction as business loss. 2. Whether on the facts and in the circumstances of the case and in law, the Id. CIT(A) erred in allowing the loss of the assessee as business loss derived by the assessee on currency derivative transaction by relying on the judgement of IVF Advisors (P) Ltd. [39 ITR(Trib.)541], wherein, the facts of the said case, is entirely different than the facts of the case of the assessee. 3....

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....res and securities, financing of loans and advances and trading of fabrics. During the course of scrutiny assessment, AO disallowed assessee's claim of business loss and trading of currency derivatives on recognised exchange, by treating the same as speculation in nature. 5. I have considered rival contentions and found that the issue under consideration is squarely covered by the decision of the Co-ordinate Bench in case of IVF Advertisers Pvt. Ltd., 39 ITR 541, wherein Tribunal held as under:- "The assesses was an investment management consultant. For the assessment year 2009-10, it claimed loss-on account of foreign currency futures. The Assessing Officer held that the loss could not be allowed in the light of the provi....

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....ated in the paper book filed before us. A perusal of the contract note shows that the assessee has ' either entered into a call option or put option and on the settlement day the transaction has been settled by delivery, either the assessee has paid US dollar on the settlement day or has taken delivery of US dollar. To sum up, the derivatives include foreign currency and call option/put option, are transactions of derivative markets and cannot be termed as speculative in nature. Considering the totality of the facts and in the light of the judicial discussion hereinabove, we have no hesitation in setting aside the order of the learned Commissioner of Income-tax (Appeals). The appeal filed by the assessee is accordingly allowed.....