2025 (6) TMI 1925

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..../s 147 of the Income Tax Act, 1961 have not been fulfilled. 2. On the facts and circumstances of the case and in law, the Ld. CIT(A), erred in confirming the disallowance of business loss of Rs. 3,28,92,419/-, by holding the loss on sale of listed scrips as pre-arranged transaction without considering the fact that the appellant had purchased and sold the shares in regular course of business activity at prevailing market prices on the recognised stock exchange through a registered broker and that the appellant had duly submitted all the documentary evidences to substantiate the same. 3. On the facts and circumstances of the case and in law, the Ld. CIT(A), erred in confirming the addition of Rs. 9,86,772/- made on arbitrary basis on account of alleged commission paid by the appellant for availing the business loss without appreciating the fact that the appellant had not paid any commission and the business loss occur under general business activity. 4. On the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in confirming the addition made by AO, without providing any opportunity of cross examination on whose statements the Ld. A....

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....nt received. 7. Broker Ledger Account 8. Statement of Purchase and Sale of the two scrips, tabulated below:- Statement of Date wise Purchase and Sale BANAS FINANCE LTD Sr. No. Date Buying Qty. Buying Cost Selling Qty. Selleing Amount Average Price 1 06/02/2012 1,40,000 78,16,975 - - 55.8355 2 09/02/2012 1,00,000 55,29,000 - - 55.2900 3 08/02/2012 1,04,000 58,33,360 - - 56.0900 4 10/02/2012 2,00,000 1,10,18,000 - - 55.0900 5 17/02/2012 1,52,500 74,84,690 - - 49.0799 6 16/02/2012 80,000 40,06,400 - - 50.0800 7 09/03/2012 - - 3,26,500 86,22,384 26.4085 8 12/03/2012 - - 2,25,000 55,96,345 24.8726 9 13/03/2012 - - 2,25,000 56,16,000 24.9600   Total 7,76,500 4,16,88,425 7,76,500 1,98,34,729   Statement of Date wise Purchase and Sale CLARUS (Name Change : SCAN STEELS Ltd ) In demat holding Statement Sr. No. Date Buying Qty. Buying Cost Selling Qty. Selleing Amount Average Price 1 09/09/2011 50,000 ....

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....icular scrips, which are typical in a trader's normal course of business. These losses are a direct outcome of market volatility and are part of the trading process. This is not the isolated financial year in which the assessee had done the share market transactions. Assessee experienced both gains and losses throughout the year, details of which are as under:- i. Profits: Assessee recorded profits from selling 11 stocks at Rs. 3,78,32,614/- ii. Losses: Conversely, losses were incurred on 13 stocks amounting to Rs. 3,91,89,860/- 2.5. Further, out of the 65 scrips traded as per the share trading account, 21 Scrips were both purchased and sold during the year. Out of 21 scrips, assessee incurred profit in 9 and losses in 13 scrips (including 2 alleged scrips traded). Assessee furnished the details of scrip-wise purchase and sale of shares. The same is extracted below: 2.6. It is asserted that these losses are neither unusual nor isolated but are integral to the trading activities and are natural consequences of speculative and short-term trades. The loss incurred on specific scrips, including those alleged 'penny stocks' by the ld. Assessing Office....

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....ive, currency derivative, call and put options, etc., having revenue from operations of Rs. 16.60 Crores in the year under consideration. Assessee had traded in 65 scrips, out of that in 11 scrips, assessee had earned profit of Rs. 3.78 Crores and cut-off the losses of Rs. 3.92 Crores in 13 scrips in the year under consideration. Such has been the trading results and business performance of the assessee for year-on-year basis, this being not a year in isolation, wherein assessee has traded in such volumes. 4. We have gone through the material placed on record, orders of the authorities below, judicial precedents in the case of Munish Financials in ITA No. 2637/M/2022, dated 31.03.2023 and Adihemshree Financial in ITA No.3069/Mum/2024 and others, dated 30.09.2024 by the Coordinate Bench of ITAT, Mumbai and have also considered the submissions made by both the parties before us, corroborated by material placed in the paper book. 5. We find that the issue raised before us have been dealt in the decisions of Co-ordinate Bench in the case of Munish Financials (supra) and Adihemshree Financials (supra) though arising out of assessment made u/s. 143(3). Submissions made by the asses....