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2018 (9) TMI 1170 - AT - Income TaxSet off of derivative loss - maintainability of loss arising from derivative transactions against the regular income - allowability of derivative loss in terms of Section 43(5)(d) - Held that:- The payment made to the share broker towards such losses is not in dispute. The specific order number and trade time is available on record. It is not the case of the Revenue that no transaction has been executed against the order number specified in the contract. Therefore, in these circumstances, it will be difficult to draw inference against the assessee for allowability of derivative loss in terms of Section 43(5)(d) of the Act. As relying on CIT vs. M/s. Sri Vasavi Gold & Bullion Pvt. Ltd. [2018 (4) TMI 802 - MADRAS HIGH COURT] we find merit in the case of the assessee with reference to the derivative loss arising in the equity segment and commodity segment. As regards, loss of ₹ 19, 678/-, it is claimed on behalf of the assessee, the correct loss stands at ₹ 23, 86, 040/- as against ₹ 23, 66, 362/- assumed by the AO in the commodity segment. Considering the smallness of amount and having regard to the documentary evidences, we do not see any warrant to differ with the version of the assessee. Therefore, the loss claimed by the assessee in the derivative segment is found to be covered by the exception provided under s. 43(5) of the Act and consequently, such loss requires to be allowed for set off against the regular income of the assessee. - Decided in favour of assessee
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