TaxTMI 
TaxTMI 
TaxTMI 
2021 (9) TMI 890
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....the Act. Learned Assessing Officer(in short Ld. AO)called for various details to which necessary submissions and documents were filed by the assessee. Ld. AO on observing held that the assessee has exempt income from the investments held and has incurred interest expenditure computed the disallowance u/s 14A of Rs. 33,40,274/-. The Ld. AO further on perusal of the transactions of purchase and sale of shares observed that the assessee has showing profit from share trading at Rs. 1,22,62,050/- incurred loss on derivatives amounting to Rs. 2,62,66,074/-. The Ld. AO was of the view that share trading and income from derivatives is speculation in nature, which cannot be set off against normal business income. The Ld. AO also observed that the expenditure incurred by the assessee are not apportioned correctly on and he on his own motion apportioned the expenses and computed the speculation loss at Rs. 5,63,23,387/- as against loss declared by the assessee at Rs. 2,62,66,074/- in following manner: Total turnover as per P&L a/c. (Rs.) Income as per P&L a/c. (Rs.) Apportioned expenditure (Rs.)(Establishment and other expenditure/Interest) Income (Loss) Sale of shares 34,69....
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....ves as business loss and not as speculation loss. It was submitted that this issue is squarely covered by the decision of the Hon'ble ITAT, Kolkata in assessee's own case for the AY 2012-13 pronounced on 24-02-2021, wherein on identical facts derivative loss was held as business loss by virtue of exception in section 43(5) of the Act. 6.2. As regards ground no. 3 relating to disallowance made for delayed payment of employees' contribution towards P.F. at Rs. 2,55,972/-, it was submitted by the Ld. Counsel for the assessee that the alleged amount was duly deposited with the appropriate authority before the due date of filing of return for the A.Y 2011- 12 and therefore, in view of the judgment of the Hon'ble Jurisdictional High Court at Calcutta in the case of ACIT vs. Vijay Shree Ltd., in ITA No. 245 of 2011, the assessee was eligible for deduction of this amount and the Ld. CIT(A) has rightly deleted the disallowance. 7. We have heard the rival contentions and perused the records placed before us and carefully gone through the decision as referred and relied on by the ld. Counsel for the assessee. Through ground nos. 1 & 2 the revenue has raised these two issues, both relating t....
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....in assessee's own case for the A.Y 2012-13 dated 24.02.2021, wherein the Tribunal after placing reliance on the judgment of the Hon'ble Jurisdictional High Court in assessee's own case for the A.Y 2005-06 by order dated 12-03-2014, has held that the income from derivatives, Future and Options and Share trading carried out on recognised Stock Exchange is not in the nature of speculation and it is a business income. The Tribunal vide its order dated 24-02-2021 in ITA No. 346/Kol/2017 observed as follows:-- "It is noted that assessee is engaged in the business of share trading and assessee is also functions as a broker of securities and is a registered stock broker (stock exchanges i.e. NSE, BSE & forward exchange etc.). The assessee admits that it is involved in the purchase and sale of shares & securities of other companies on self account where the actual delivery is taken and given from which gross income has been shown at Rs. 3,15,992/-. It is noted that the assessee is also engaged in derivative transaction [wherein the actual delivery is not taken or given] and it incurred gross loss from derivative transaction at Rs. 37,48,335/-. The assessee has admitted to have earned gros....
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....ity or scrips: Provided that for the purposes of this clause( a) a contract in respect of raw materials or merchandise entered into by a person in the course of his manufacturing or merchanting business to guard against loss through future price fluctuations in respect of his contracts for actual delivery of goods manufactured by him or merchandise sold by him; or (b) a contract in respect of stocks and shares entered into by a dealer or investor therein to guard against loss in his holdings of stocks and shares through price fluctuations; or (c) a contract entered into by a member of a forward market or a stock exchange in the course of any transaction in the nature of jobbing or arbitrage to guard against loss which may arise in the ordinary course of his business as such member; [or ] (d) an eligible transaction in respect of trading in derivatives referred to in clause [( ac) of section 2 of the Securities Contracts (Regulation) Act, 1956 (42 of J 956) carried out in a recognised stock exchange; [or] (e) an eligible transaction in respect of trading in commodity derivatives carried out in a [recognised association, which is chargeable to commodities transaction tax ....
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....e explanation quoted above cannot be said to have provided otherwise. In that case the irresistible conclusion is that the assessee is entitled to set off such loss arising out of deemed business against the income arising out of business proper." 8.1. On going through the above decision of this Tribunal, we find that the issue raised in the ground no. 2 of instant appeal is same and above stated decision of the Tribunal is squarely applicable on the issue raised before us in ground no.2. Ld. DR failed to controvert this fact and could not place any binding precedence in its favour. We, therefore, respectfully following the decision of this Tribunal in assessee's own case for the AY 2012- 13, are of the considered view, the income from Share Trading in Future & Options and Derivatives earned by the assessee during the year under consideration has been rightly claimed as business income/loss. We, thus, find no infirmity in the finding of the Ld. CIT(A) on this issue. Accordingly, ground no. 2 raised by the revenue stands dismissed. 9. Through ground no. 3 the Revenue has challenged the finding of the Ld. CIT(A) deleting the addition of Rs. 2,55,972/- made by the ld. AO in view of ....