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2016 (7) TMI 456 - AT - Income TaxSet off of loss from settlement of forward contracts for foreign currency against income from ‘other sources’- Held that:- As relying on assessee's own case for assessment years 1998-99 and 2005-06 find no error in the orders of the authorities below, in the year under consideration, in holding that the loss arising from settlement of forward contract taken by the assessee to safeguard the foreign exchange loan taken for acquisition of shares/debentures is capital loss as returned by the assessee. There is no requirement for us to issue directions to the AO as urged by the assessee, since the AO is bound to follow the directions of the Hon'ble High Court when the appeals before their Lordships is decided. Finding no merit in this ground raised and in the light of the decision of the Coordinate Bench (supra) upholding the assessee’s claim in the matter, we dismiss ground No. 1 raised by the assessee. Application of section 79 - denial of carry forward of long term capital losses incurred in financial year - Held that:- In the year under consideration, neither has there been a change in the shareholding pattern of the assessee nor has there been any claim for set off of carried forward of losses of the year’s prior to A.Y. 2005-06. Hence, in our view, and as contended by the learned A.R. for the assessee the conditions precedent for invoking and bringing into play the provisions of section 79 of the Act are absent and have been wrongly applied by the AO to disallow the aforesaid losses, the set off of which were never claimed in this year. We, therefore, delete the order of the AO on this issue as the same matter is to be examined in the year in which such claim is preferred. - Decided in favour of assessee
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