TMI Blog2014 (9) TMI 1083X X X X Extracts X X X X X X X X Extracts X X X X ..... stock exchange after 1-4-2006 would be eligible for being treated as nonspeculation within the meaning of section 43(5)(d) of the Act. In the instant case also the assessment year under consideration is A.Y. 2007-08, therefore, as per the proposition laid down by the co-ordinate Bench above the loss incurred by the assessee should be treated as normal business loss. Once such loss is treated as business loss, mere treatment by the A.O. as speculation loss will not be justified to levy penalty u/s 271(1)(c) of the Act. Thus we hold that addition made by mere change of head of income will not attract penalty u/s 271(1)((c) of the Act. The A.O. is directed to delete the same - Decided in favour of assessee - I.T.A. No. 1636/Mum/2013 - - - ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ried out in a recognized stock exchange were ultimately settled out otherwise than by the actual delivery or transfer of scrip. The profit/loss from trading in derivative transactions is considered as business income and not speculative transaction. NCDEX and MCX are also exchanges for trading in commodities and the commodities transactions in NCDEX and MCX are also settled otherwise than by the actual delivery or transfer of commodity. Accordingly, trading in commodities transactions at NCDEX and MCX were treated as business activities and loss from commodities transactions of ₹ 15,01,708/- was set off against other business income under the same taxable head of income. In the return of income, the assessee has furnished all details ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... business loss as speculative loss would not amount to concealment u/s 271(1)(c) of the Act. It was held that penalty u/s 271(1)(c) was not leviable where the addition was made on account of treatment of business loss as speculation loss. The Hon ble Supreme Court in the case of CIT vs. Reliance Petroproducts (P) Ltd., 322 ITR 158 (SC) also observed that mere making of the claim, which is not sustainable in law, by itself will not amount to furnishing inaccurate particulars so as to levy penalty u/s 271(1)(c) of the Income Tax act, 1961. 5. In view of the above discussion, we hold that addition made by mere change of head of income will not attract penalty u/s 271(1)((c) of the Act. The A.O. is directed to delete the same. 6. In the r ..... X X X X Extracts X X X X X X X X Extracts X X X X
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