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2011 (1) TMI 913 - AT - Income TaxSpeculation loss - Loss from the purchase and sales of shares - Loss from the valuation of the closing stock - Since there are large number of transactions of purchase and sale of shares during the year under consideration - Therefore, there is no dispute that explanation to section 73 is applicable - Only question is with regard to determination of loss from the business of purchase and sale of shares - while determining loss from share trading business, loss from valuation of closing stock cannot be excluded - Valuation of closing stock is integral part of preparation of treading account - Hence, reject the assessee's appeal. Disallowing - Interest expenditure - the assessee itself while computing the income has disallowed the sum of ₹ 14 lakhs out of the interest. The Assessing Officer has worked out disallowance of ₹ 14,28,000 - It is stated by the learned counsel that though the difference in disallowance is negligible, however, the assessee is pressing the ground because the assessee is working out the disallowance in the same manner every year and it is also being accepted by the revenue - Thus, the assessee gets relief of ₹ 28,000. Speculation gain - Long term capital gain on sale of shares -the assessee is a company, but in respect of sale of shares, which were held as investment, it cannot be said that it was part of the business of purchase and sale of shares -Hence, allow the assessee's appeal. Speculation business expenditure - Share transfer - the assessee fairly admittedly that these expenditure were relating to share trading business, therefore, the above expenditure will only increase the speculation loss - Therefore direct the Assessing Officer to increase the speculation loss - The assessee's appeal is rejected.
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