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2021 (12) TMI 1032 - AT - Income TaxRevision u/s 263 - speculative transaction or not - majority of trades undertaken through day jobbing in which sale and purchase of scrips on same day are matched without taking the delivery of the scrips - one of the reasons for selecting the case for scrutiny was large value sale of share which were settled otherwise than by actual delivery or transfer of STT - HELD THAT:- If the amount of ₹ 93,23,384/- is treated as speculation loss then business loss of ₹ 26,58,196/- will get set off against the income from house property of ₹ 20,52,542/-, against income from other sources of ₹ 5,40,403/- and against short term capital gain of ₹ 65,251/-. This will result in balance short term capital gain of ₹ 3,84,32,308/- to be set off against carry forward loss under the same head 'short term capital gain' against available carry forward short term capital gain of ₹ 4,41,05,508/-. There is no impact of any revenue loss in this year nor in the subsequent year. Similar is the fact in A.Y. 2016-17 wherein if ₹ 2,92,861/- is treated as speculation loss instead of business loss, taxable income will remain the same of ₹ 59,70,000/-. This fact has not been denied by the ld. Pr. CIT or ld. CIT DR. Thus, if there is no loss of revenue in this year or in subsequent year nor will it impact the taxable income, then the assessment order cannot be held to be prejudicial to the interest of revenue and accordingly, in view of the principle laid down by Hon'ble Apex Court in the case of Malabar Industrial Co. Ltd.[2000 (2) TMI 10 - SUPREME COURT]the assessment order cannot be set aside. Otherwise also, it is purely a case of change of opinion for the reason that similar nature of transaction of day trading of shares and F & O has been held to be business income/business loss in all the earlier years wherein assessment has been completed u/s. 143(3) of the Act. Thus, if rule of consistency is applicable on the same facts and circumstances in these years, then merely changing the head of income from business to speculation, then it cannot be held that the assessment order is erroneous and prejudicial to the interest of revenue. More so, here in this case, section 263 has been done only on the basis of audit objection which was only for the purpose of verification and which has already been examined by the AO during the course of assessment proceedings. Accordingly, the impugned orders u/s. 263 are set aside and assessment orders passed u/s. 143(3) of the Act are restored. - Decided in favour of assessee.
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