TMI Blog2019 (4) TMI 1159X X X X Extracts X X X X X X X X Extracts X X X X ..... s deeming fiction is restricted only for the purposes of Section 50 of the Act but the benefit of set off of long term capital loss under section 74 of the Act is to be allowed. Hon ble High Court has also followed its decision in the case of CIT vs. . Ace Builders (P.) Ltd, [ 2005 (3) TMI 36 - BOMBAY HIGH COURT] As regards to set off of business loss against gain on sale of depreciable asset of factory building by the assessee, We find that the co-ordinate Bench of the Tribunal in the case of M/s. Raj Shree Roadlines vs ITO [ 2013 (3) TMI 811 - ITAT MUMBAI] for A.Y . 2007-08 has considered the issue of business loss of unabsorbed depreciation and eligible business loss can be set off against short term capital gain computed u/s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the CIT(A) in allowing set off of brought forward business loss and brought forward long term capital loss against the deemed short term capital gain computed by the assessee. For this, the revenue has raised following two grounds: 1. The ld CIT(A) has erred in not appreciating the fact that provisions under section.72 of the income tax act 1961 allows only business loss to be set off against business income and provisions us.74 of the income tax act, 1961 allows only LTCL can be set off against LTCG,. 2. The CIT(A) has erred on facts and in law in allowing set off claim of brought forward business loss ₹73,45,952/- and brought forward long term capital loss of ₹28,17,942/- against short term capital gain as per s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ly, the Assessing Officer disallowed the claim of brought forward business loss and brought forward long term capital gains. Aggrieved, the assessee preferred appeal before the CIT(A). 4. The CIT(A) after considering the submissions of the assessee and also considering the decision of Hon ble Bombay High Court in the case of CIT vs. Manali Investments vs ACIT , 39 Taxman com.4 dated 13.3.2013 allowed the claim of brought forward business loss and brought forward long term capital loss to be set off against short term capital gain computed under section 50 of the Act. For this, the CIT(A) observed in para 4., 4.1, 4.2 4.3 as under: 4. As regards ground No. 1, the facts are that the appellant has sold its factory building and cla ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h not taxable as profits and gains of business or profession is an income in the nature of income of business though assessed as capital gains under section 50 and therefore the assesse is entitled to set off of brought forward business losses against the said capital gain. 4.2 Further the Honb'le Bombay High Court in the case of CIT-9 vs. Pursarth Trading Company P. Ltd ITA NO. 123 of 2013 dated 13/3/2013, 33 Taxmann.Com. 482 (Bom) also held that b/f long term capital loss can be set off against short term capital gain computed u/s 50C following the decision in the case of Manal Investments vs. ACIT (2011). Hon'ble Bombay^ High Court in the case of CIT-19 vs Manali Investments 39 Taxmann.Com. 4 dated 13/3/2013 held that in vi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... off against such gain in terms of provisions of section 74 of the Act. Similarly, even brought forward long term capital loss cannot be set off against short term capital gain as per provisions of section 74 and 72 of the Act. According to him, the Assessing Officer has rightly disallowed the claim and the CIT(A) totally erred by allowing the claim of the assessee. 7. On the other hand, ld Counsel for the assessee relied on the order of the CIT(A). 8. We have heard the rival contentions and gone through the facts and circumstances of the case. We find that Hon ble Bombay High Court in the given facts has considered this issue in the case of Manali Investments (supra), wherein, the question referred before the Hon ble High Court reads ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Raj Shree Roadlines vs ITO (ITA No.1627/Mum/2012) for A.Y . 2007-08 has considered the issue of business loss of unabsorbed depreciation and eligible business loss can be set off against short term capital gain computed under section.50 of the Act. We find that the Tribunal after considering the provisions of section 32(2), 72(2) and 73(3) of the Act opined that while deciding the issue of carrying forward of loss/unabsorbed depreciation and the amendment made in these section from time to time are applicable for carrying forward of depreciation/loss with effect from 1.4.2002. For this proposition, the Tribunal has relied on the decision of Hon ble Bombay High Court in the case of CIT vs. Hathway Investments (P) Ltd., in Income Tax Appeal ..... X X X X Extracts X X X X X X X X Extracts X X X X
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