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2018 (5) TMI 142 - ITAT DELHIHolding loss as speculative loss - whether the transactions of forward (future) contract of sale of gold to the Bank or the MMTC are speculative transaction or not? - Held that:- Object of entering into forward contract transaction has to be seen from the contract agreements and underlying assets. In the case of the assessee for claiming benefit of clause (a) of Section 43(5) of the Act, its forward contract transactions should have been corroborated one by one, with the purchases of gold and supply of jewellery manufactured. Before the Assessing Officer, the assessee failed to correlate these forward contract transactions of gold and corresponding purchases and export of jewellery. Even such details have not been filed either before the Ld. CIT(A) or before us. Thus, on this ground, the assessee cannot be allowed the benefit of proviso (a) to section 43(5) of the Act in absence of any documentary evidences to support its contention of fulfilling conditions of proviso (a) to section 43(5) of the Act. - Decided against assessee Transaction of foreign currency forward contracts as speculative by the Ld. CIT(A) - Held that:- We note that the Ld. CIT(A) has decided the issue in view of the facts noted in the case of forward contract transactions of the gold and no documentary evidence in support have been referred in his findings on the issue in dispute.We feel it appropriate to restore this issue to the file of the Assessing Officer for deciding afresh after providing adequate opportunity of being heard to the assessee, with liberty to the assessee to file necessary documentary evidence in support its claim. Thus, the ground Nos. 1 to 4 of the appeal of the Revenue are accordingly allowed for statistical purposes. Addition on account of interest at the rate of 10% on the sum expended by the assessee to partners on account of interest-free advances - Held that:- We find that the Ld. CIT(A) has arrived at the conclusion after verifying the capital accounts of the partners that no loans/advances have been given to the partners out of borrowed fund and no interest has been paid to the partners and thus the disallowance of notional interest was not justified.
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