TMI Blog2019 (5) TMI 1707X X X X Extracts X X X X X X X X Extracts X X X X ..... actions which the Revenue alleged were speculative. Given that the Revenue s appeal has been remitted, the ITAT s approach in our opinion was not correct. Accordingly, the assessee s question with respect to the verification of the transactions and the correlation with specific contracts shall be examined having regard to the assessee s contentions as well. We are of the considered view that since the identical issues for AY 2010-11 are already pending adjudication by the AO having been remanded by the Hon ble Delhi High Court, the same issues qua for the year under assessment are also required to be remanded back to the AO to decide in accordance with the order passed by the Hon ble High Court. Consequently, both the appeals are set ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the year under reference, while filing the return of income on 24.05.203 had treated it to be business profit. 3. The CIT(A) has erred in ignoring the fact that transaction was not listed/traded on a recognized stock exchange, as also, CIT(A) has further erred in ignoring the fact that neither do the transactions fall under the condition led down u/s 43(5)( d) of I. T. Act, 1961, nor has the assessee produced any documentary evidence during the assessment proceedings substantiating that the transactions referred to, by the assessee were indeed 'hedging' which also finds consonance in the judgment of Apex Court in case of CIT vs. Joseph John (1968) 67 ITR 74 (SC). 4. The Ld. CIT(A) has erred in deleting t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ection 43(5)(a) and 43(5)(b) of the Income-tax Act, 1961 (for short the Act ). It is also observed by the AO that the assessee has not disputed that it is indulged in the derivative of gold and foreign currency which is treated as speculative transaction under section 43(5) of the Act. Declining the contentions raised by the assessee, AO proceeded to conclude that the assessee has failed to establish that the transaction carried out by the assessee firm are for hedging purpose and not speculative transaction and thereby made an addition of ₹ 1,04,25,309. AO also made addition of ₹ 54,000/- on account of notional interest on the sum of ₹ 5,40,000/- expended by the assessee to partners on proportionate basis @ notional i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... te the assessee s contention with respect to the contracts which it claimed were not forward contracts by virtue of proviso clauses (a) (b) to Section43 (5) of the Act. The contention was declined on the ground that no correlation between the forward contract transactions of gold and corresponding purchases and export of jewellery was established to satisfy the requirements of law. This Court is of the opinion that the assessee s contention has some merit the earlier portion of the main impugned order specifically noticed the compilation of documents produced during the proceedings, which contained specific contracts and the transactions which the Revenue alleged were speculative. 5. In these circumstances, given that the Re ..... X X X X Extracts X X X X X X X X Extracts X X X X
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