Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2015 (9) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2015 (9) TMI 494 - AT - Income TaxDisallowance of loss incurred by the assessee on forward contracts and other derivative contracts as speculation loss - Held that:- Both trading of shares and derivative transactions are not coming under the purview of Section 43(5) of the Act which provides definition of "speculative transaction" exclusively for purposes of section 28 to 41 of the Act. Again, the fact that both delivery based transaction in shares and derivative transactions are non-speculative as far as section 43(5) is concerned goes to confirm that both will have same treatment as regards application of the Explanation to Section 73 is concerned, which creates a deeming fiction. Now, before application of the said Explanation, aggregation of the business profit/loss is to be worked out irrespective of the fact, whether it is from share delivery transaction or derivative transaction. One has to see whether the assessee entered into these derivative within the period stipulated for payment of export proceeds or within the time period allowed for payment of interest to the concerned bank. Further, it is to be seen whether the volume / quantum of derivative transaction entered by the assessee is more than the total export turnover and payment of interest to bank and volume of transaction cannot be more than these two components. Accordingly, we are directing the Assessing Officer to keep these facts in mind and decide the issue in the light of the Tribunal order in the case of M/s. Majestic Exports (2015 (7) TMI 936 - ITAT CHENNAI ). With these observations, we are remitting back this issue back to the file of the Assessing Officer for fresh consideration. - Decided partly in favour of assessee for statistical purposes.
|