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2020 (1) TMI 909 - AT - Income TaxUnexplained credit u/s 68 - brokers had not appeared in response to the summons sent by AO - HELD THAT:- Assessee has demonstrated from the records that all the requisite details were submitted to the Assessing Officer to prove the genuineness of the transactions entered into by the assessee in commodity trading activity. In our view, merely because the brokers had not appeared in response to the summons sent by the Assessing Officer that itself cannot be the sole ground to reject the entire evidence produced by the assessee. The assessee not only furnished the names and addresses of the brokers and the other concerned parties but also the other details like their PAN numbers, bank account details and even the trading license, telephone bills and other evidences as detailed above. The assessee has also produced the details of the commodity transactions carried out by the assessee alongwith purchase and sales invoices. Under the circumstances, the action of the lower authorities in assessing the income u/s 68 of the Act cannot be held to be justified Set off of loss from one head against income from another - Set off of losses against deemed income u/s 68 - As per the section 71(1) of the Income Tax Act, losses, from one head can be set off against the income from another head of income. This controversy has been settled by the CBDT Circular No. 11 of 2019 dated 19.6.2019, wherein it has been provided that even if the said income is treated as an income assessed u/s 68 of the Act, still the assessee is entitled to set off of the said income against the business loss - There is no merit in the action of the lower authorities in making the impugned additions and not allowing the set off of income from commodity transactions as business losses of the assessee. Accordingly, the impugned order of the CIT(A) is set aside and the additions made by the lower authorities is ordered to be deleted. - Decided in favour of assessee.
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