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2013 (11) TMI 361 - AT - Income TaxSet off of loss of Short Term Capital Gain as claimed by the assessee ignoring the provisions of section 70(1) of the Income tax act - Whether the assessee is entitled to adjust the loss on short term capital assets (STCA) arising on one set of transactions, i.e., 'on market transactions', with the short term capital gain (STCG) arising to it on another set of transactions, i.e., 'off market transactions – Held that:- 'Loss' is only negative 'income', and is, in any case, assessable under the same head of income; any taxable income under the Act being required to be classified and assessed to tax under a particular head of income - Sub-section (1) of sec. 70, referred to by the Revenue in its ground of appeal, refers to a source of income (under a head), and is in any case not applicable to income assessable as 'capital gains'. Reference thereto is therefore be to no moment; rather, would if at all signify that income on transfer of STCAs is regarded as one category or source of income u/s. 70(2). Reliance has been placed on the in the case of First State Investments (Hong Kong) Ltd. v. Asstt. DIT (International Taxation) [2009 (7) TMI 908 - ITAT MUMBAI], wherein it was held that the computation of income is a process anterior to the application of the tax rate, so that the differential in the tax rates is rendered as of no relevance - No infirmity in clarifying that the option to set off the loss arising under the same class of income, i.e., on STCA, notwithstanding the words 'similar computation' in section 70(2), would lie with the assessee - The words 'similar computation' would only mean the computation as made u/ss. 48 to 55 of the Act, and nothing more – Decided against the Revenue.
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