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TMI Blog2023 (10) TMI 778X X X X Extracts X X X X X X X X Extracts X X X X ..... rd to addition of Rs. 48,09,315/- on account of alleged fictitious loss in derivative trading account u/s 148. The order passed by the Hon'ble CIT(A) is without analyzing the facts of the case and is against the cannons of Justice. Grounds of Appeal No.1 Addition on account of fictitious loss in derivative trading of Rs. 48,09,315/- Addition u/s 148 towards alleged loss of Rs. 48,09,315/- in respect of derivative in Equity & MCX whereas the assessee has reflected a net profit of Rs. 73,46,240/- from derivatives. The assessee has also not revised any income u/s 148 while filing ITR against notice u/s 147. The order confirmed by the Hon'ble CIT(A) is arbitrary, not founded on facts and is prayed to be deleted in full. 2. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 018, dismissed the Appeal filed by the assessee. 5. We have heard the Ld. Departmental Representative and perused the material available on record. The Department of Revenue had received an information that the Assessee had received fictitious loss of Rs. 48,09,315/- from Mansukh Securities and Finance Ltd., which reduced the profit of the assessee the case of the assessee was reopened. The assessee was asked to show cause as to why the said amount of Rs. 48,09,315/- not be added back to the income. The assessee replied as under:- "During the course of last hearing, you honour has stated as to why earning of Rs. 48,09,315 received from Mansukh be not treated as income. In this connection, we invite reference to our letter dated 19th Ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ties and Finance Ltd and therefore, reduced the profit by the same amount. On the basis of this information, the assessment was reopened after recording the reasons for escapement and after taking statutory approval, notice u/s 148 of the I.T. Act was issued on 30.03.2015 requiring the appellant to file return of income for the year under consideration. Reasons for reopening of assessment were also provided to the appellant. The notice u/s 143(2) of the I.T. Act dated 09.09.2015 was issued and served upon the appellant and the objections were duly disposed of by passing a speaking order vide letter dated 07.09.2015. The appellant has stated that during the year, the company has shown a profit of Rs. 73,46,240/- from derivative in equity a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dismissed." 7. It is observed that the assessee company has been booking losses by using Client Code Modification in the year under consideration and the amount of Rs. 48,09,315/- as held by the A.O. to be fictitious loss. It is found by the authorities that the script wise details of the derivative trading that the assessee had taken the fictitious loss in order to reduce the profit. The assessee has not produced any material to contradict or disprove the said findings of the A.O. Therefore, in our considered opinion, the Ld. CIT(A) has committed no error in confirming the addition made by the A.O., accordingly, we find no merits in the Grounds of Appeal of the assessee which are dismissed. 8. In the result, the appeal filed by the asses ..... X X X X Extracts X X X X X X X X Extracts X X X X
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