TMI Blog1998 (4) TMI 163X X X X Extracts X X X X X X X X Extracts X X X X ..... ese transactions as liable to be set off against business income. The Ld. CIT(A) has overlooked the deeming provisions of explanation to section 73 of the I.T. Act, 1961." 2. The Ld. D.R. has pointed out that the assessee purchased shares of three companies namely M/s. Oswal Agro Mills, M/s H.M.M. Ltd. and M/s Reliance Industries Ltd. on 6-12-1987, 10-12-1987 and 19-12-1987 and the same have been sold on 11-12-1987, 19-12-1987 and 19-12-1987 respectively without making any payment for receiving or selling the shares. There has been no transfer in the name of the assessee nor any delivery has been taken by the assessee and accordingly, the Assessing Officer has treated the transaction purely as speculative transaction in which the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... speculative transactions by applying the explanation to section 73 of the Act then the rest of the business which the assessee company has carried out during the relevant year should also be treated as speculative and the loss of Rs. 2,10,650 may be allowed to be set off against the income from rest of the business carried out by the assessee. For this reliance has been placed in the case of Samba Trading Investment Ltd. v. Asstt. CIT [1996] 58 ITD 360 (Mum.). It has also been pointed out by the AR that the statement of Shri M.K. Singhal, the broker was recorded by the Assessing Officer on5-3-1989and the said broker in his statement has clearly indicated that actual physical delivery of share was handed over to the assessee company for o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... esses of the sellers and purchasers but the whole case of the revenue is that the assessee could not prove before the Assessing Officer that it has taken the delivery of the shares. It is not disputed that Shri M.K. Singhal the stock broker was present before the Assessing Officer and his statement was recorded under section 131 of the I.T. Act, 1961. The said Shri M.K Singhal in his statement before the Assessing Officer has relied to the question as under: "Delivery of shares was taken by me and handed over to the assessee for one day. When the assessee company failed to make payments in full, the delivery was recalled and sold in the market." 6. From the above, it is seen that the delivery was handed over by the broker to the assesse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -12-1987,19-12-1987and19-12-1987. In a situation when the delivery of all the shares in question is stated to have been handed over for one day and on the contrary it is found that the date of last purchase and first sale are the same, then it does not inspire confidence as to whether the delivery could be handed over for one day. Also the assessee has not brought any material to show the dates on which it has received the delivery or that it has been received on different dates. A peculiar statement has been made by the broker wherein it has been stated that when the assessee failed to make the payments in full, the delivery was recalled and sold in the market. In such a situation the recalling would make the delivery in effective. There c ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
