TMI Blog2014 (12) TMI 1249X X X X Extracts X X X X X X X X Extracts X X X X ..... t earned during the year was not out of future and option transaction. Thus the assessee was entitled to set off the carried forward losses of earlier assessment years against profits of the same business in this assessment year. The classification of business for the limited purpose of set off of past losses, into speculative and non-speculative is to be done on uniform basis and losses incurred in the same business in earlier assessment years are to be treated as eligible for set off against profit of the same business in the subsequent assessment years. For this reason also the assessee deserves to be allowed to set off of brought forward losses from business of dealing in derivatives, incurred in assessment years prior to assessment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... year incurred on derivative transactions out of profit of transactions of similar in nature in the current year. The AO declined the claim on the plea that carry forward loss from speculation business cannot be set off against the business income in the current year. By the impugned order, the CIT(A) confirmed the action of the AO and assessee is in further appeal before us. 3. We have considered rival contentions and found from the record that the assessee had entered into derivative transactions in the form of Futures and Options and incurred speculative loss since A.Y.2004-2005. In the preceding assessment years 2004-05, 2005-06, 2006-07, 2007-08 the assessee has incurred losses from derivative transactions as per chart hereunder: ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing the year under consideration. It is clear from the record that assessee had carried out Future Option transactions and incurred losses in earlier assessment years and he wants such losses to be set off against the profit of the same activity in this assessment year. It is not in dispute that the assessee has earned profit from the same business in which losses were incurred in the earlier years. The loss brought forward during all these years and gain made during the year is having same nature. There is no change in the nature earning of income during the year. In all the preceding years he was incurring losses in futures and options transactions but in current year he made gain. Nothing was brought on record by AO to allege that prof ..... X X X X Extracts X X X X X X X X Extracts X X X X
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