TaxTMI 
TaxTMI 
TaxTMI 
2022 (3) TMI 1208
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....assessee has raised common grounds of appeal except variation of figure of disallowance of set off in both the years. The fact in both the years are similar, therefore, both the appeal were clubbed, heard together and are decided by common order. For appreciation of facts appeal in ITA No.335/SRT/2019 for the A.Y. 2015-16 is treated as lead case. The assessee raised following grounds of appeal: "1. (a) The Ld. CIT(A)-3, Vadodara has erred in law and in facts in confirming the action of the Ld. A.O. in holding that for the purpose of interpretation of Explanation to Sec. 73, the main object of the Company is determinative in deciding the main activity and business of the Company as against the actual conduct of business and activity. (b)....
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....declaring loss of Rs. 2.34 crore. The case of assessee was selected for scrutiny and assessment was completed under section 143(3) of the Act on 26.12.2017. During the assessment, the Assessing Officer (AO) recorded that for the year under consideration, the assessee is engaged in the business of Trading and Investing in shares, securities, derivatives and real estate. However, as per the Memorandum of Association (MoA), the main object of the assessee is to carry on business of construction, build, alter, acquire etc., whereas during the year, the assessee involved in trading of equities and derivatives. The assessee has claimed set-off of losses incurred from trading in shares and securities with the capital gain income from other sources....
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....see whose principle business is that of trading in share. Considering the Profit and Loss Account and operation of assessee, it is not doubt that principle business of assessee is undoubtedly that of trading in share and consequently, the Explanation cannot be invoked against the assessee and that loss in trading of share of Rs. 2.49 crore is to be considered as business loss and set-off against the short term capital gain and income from other sources. 5. The ld.CIT(A) after considering the submission of the assessee held that that Explanation to section 73 excludes the losses from being treated as speculative in case of the company whose principle business is that of trading in share. The ld. CIT(A) recorded that it is true that during t....
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....the main object of the assessee and not the principle business. Thus, the exclusion contained in Explanation to section 73 still not apply to assessee and upheld the order of the AO. Aggrieved by the order of ld.CIT(A), the assessee filed the present appeal before this Tribunal. 7. We have heard the ld.Authorised Representative (ld.AR) of the assessee and ld. Senior Departmental Representative (ld. Sr. DR) for the Revenue. The ld.AR for the assessee submits that the AO disallowed the set-off of loss against the capital gain and other business by taking view that assessee's main object is not of trading in share and securities. The Ld. AR for the assessee submits that on perusal of Profit and Loss Account and operation of assessee, it is no....
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....ccount. The assessee is engaged in furtherance of real-estate business of assessee is not in the business of share and securities trading. The ld.CIT(A) examined the entire balance sheet and concluded that assessee is carrying out its financial activities as per MoA and mainly dealing in the business of development and construction activities and accordingly, the losses on account of speculative transaction is not allowable against the other income. The ld.Sr.DR for the Revenue submits that she relied on the order of ld.CIT(A). 9. We have considered the rival submissions of both the parties perused the order of Lower Authorities carefully. We find that the A.O. disallowed the set off of losses of Rs. 2.49 Crore by taking view that the main....