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2013 (9) TMI 532 - AT - Income TaxSpeculative loss - Setting off the Brought Forward Losses – Proportionate Expenses - Whether the CIT(A) was erred in not setting off the brought forward losses on shares as per last assessment order against current year profit from share activities and in not considering the proportionate expenses out of the expenses capitalized – Whether or not the activity of the assessee regarding sale and purchase of shares was similar to the activity carried on by it in respect of sale and purchase of shares with regard to assessment year 2007-08 - Held that:- There being lack of clarity on facts, it would be just and proper to restore the issue to the file of AO to bring all the facts on record and give a specific finding that where or not assessee's activity of sale and purchase of shares during the year remains same as it was in respect of assessment year 2007-08 and after determining this fact the AO will determine that whether such activity is speculative in nature - If such activity is speculative in nature then set off of earlier determined speculative loss is to be granted to the assessee - With these observations the issue was restored to the file of AO. According to the provisions of the Act brought forward speculative loss can be adjusted against speculative profit only - The AO in the computation of income had not determined the profit arising out of activity of sale and purchase of shares as speculative profit - the reason given by AO for disallowance of the claim of the assessee was absence of details regarding eligible losses. In the light of the material palced, The relevant observation of AO on the issue in respect of assessment years 2004-05 and 2005-06 from respective assessment orders have already been reproduced - The department cannot take different stand on the year under consideration as principle of consistency has to be followed - However, for verification of the quantum claimed by the assessee the issue was restored to the file of AO - After verifying the quantum the AO will allow the claim of the assessee according to the stand taken by revenue in respect of A.Ys 2004-05 and 2005-06 – Decided in favour of Assessee.
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