TMI Blog2018 (3) TMI 1967X X X X Extracts X X X X X X X X Extracts X X X X ..... The aforesaid assertions of the assessee have been consistently made before the lower authorities and we find that the same is duly supported by the copies of returns of income placed in the Paper Book filed before us for Assessment Years 2008-09 to 2012-13. Under these circumstances, we find merit in the plea raised by the assessee that the action of the AO in denying the benefit of carry forward of speculation loss on the ground of it being non-genuine is of no consequence so far as the determination of assessee s tax liability in the instant as well as in the subsequent years is concerned. The action of the AO is quite nugatory and does not result in any variation in tax liability determined by the assessee in its returns of income in the instant as well as in the assessment years up to 2012-13 qua the said speculation loss is concerned. Therefore, we do not find any reasons to uphold the action of the income-tax authorities on this aspect. Carry forward of short term capital loss transacted through broker - As the preliminary plea by the assessee has not been properly adjudicated. Notably, the entire assessment is based on the findings and information resulting from search ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ares like Broker's notes, etc to prove the genuineness of the transaction. (c) The Ld. CIT (Appeal) has erred in confirming the treatment of purchase and the sale of shares as sham transactions and in rejecting the claim of the appellant to carry forward Speculation loss as well as Short Term Capital Loss; even when the appellant has paid the purchase amount as well as received the sale proceeds through account payee cheques and transacted the sale through a recognized stock exchange which cannot be proved to be bogus. 2. (a) Without prejudice to the fact that, the share transactions carried out through M/s. Sunchan Securities Ltd. are genuine, the learned CIT (Appeal) has erred in confirming the disallowance of claim of carry forward of short term capital loss of Rs. 28,16,475/- which is incurred while transacting through a broker M/s. Alankit Assignements Ltd. which is registered with the stock exchange and which is not related to Shri Mukesh Choksi. (b) The Ld. CIT (Appeal) has erred in not considering the reply filed by the appellant as regards the brokers M/s. Alankit Assignments Ltd. and M/s. Sunchan Securities Ltd. which are registered with the stock excha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sing Officer and thereafter before the CIT(A), assessee vehemently pointed out that there was no justification for the said action inasmuch as so far as the claim of short term capital loss of Rs.28,16,475/- was concerned, the same was incurred on account of transactions through broker, M/s. Alankit Assignments Ltd., a concern which was no way related to Shri Mukul Choksi or his group; and, so far as the incurrence of speculation loss of Rs.85,11,569/- was concerned, assessee pointed out that the same was duly evidenced by the broker notes, bank statement evidencing the payment made relating to the transactions carried out with the broker, M/s. Sunchan Securities Ltd. Pertinently, with regard to the speculation loss, it was pointed out that there was no justification in disallowing the same inasmuch as though the same was carried forward in later years, but no set-off was claimed within the prescribed period and it had since lapsed. It was, therefore, pointed out that the disallowance on this score is of no consequence and ought to be set-aside. 6. We find that the Assessing Officer and also the CIT(A) brushed aside all the factual aspects sought to be brought out by the assesse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the orders of the authorities below. In this context, we find that all the factual assertions sought to be made by the assessee with regard to M/s. Alankit Assignments Ltd. as well as the nugatory effect of denial of carry forward of speculation loss have not been pointedly addressed by any of the authorities below. 10. In this background, we have carefully considered the rival submissions. Sec. 73 of the Act prescribes that any loss computed in respect of a speculation business shall not be set off except against the profit and gains, if any, of any speculation business. It is further prescribed that where for any assessment year, loss computed in respect of speculation business is not wholly set-off, it may be carried forward to the following assessment years for not more than four assessment years immediately succeeding the assessment year for which the loss was first computed. In the case before us, the assessee claimed that it has incurred a speculation loss of Rs.85,11,569/- during the year and in the absence of any speculation income, he sought to carry forward the same to the subsequent assessment year. For the reasons noted by us in the earlier part of this order, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sence in the orders of the authorities below. Therefore, we deem it fit and proper to set-aside the aspect relating to assessment of assessee s claim of carry forward of short term capital loss of Rs.28,16,475/- back to the file of the Assessing Officer. The Assessing Officer shall consider the aforesaid plea of the assessee appropriately and proceed thereafter, as per law. We may clarify here that even if it is found that the concerned broker, M/s. Alankit Assignments Ltd. is not a part of Shri Mukesh Choksi group of concerns, yet, the Assessing Officer would be at liberty to examine the genuineness or otherwise of assessee s claim as per law. Needless to mention, the Assessing Officer shall allow the assessee a reasonable opportunity of being heard in support of his stand with respect to the claim of carry forward of short term capital loss and only thereafter, he shall pass an order afresh on this limited aspect, as per law. 12. In the result, appeal of the assessee, Shri Shailesh B. Ajmera being ITA No. 2961/Mum/2017 is partly allowed. 13. It was a common point between the parties that the facts and circumstances in the case of Ms. Kokila S. Ajmera and Ms. Jyotiben N. Ajm ..... X X X X Extracts X X X X X X X X Extracts X X X X
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