SURYA COMMERCIALS LTD.,KANPUR vs. DY. COMMISSIONER OF INCOME TAX, RANGE-6, KANPUR

ITA 507/LKW/2017Status: DisposedITAT Lucknow06 September 2019AY 2010-119 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the business of the assessee, which involved purchase and sale of shares, was speculative in nature as per the Explanation to Section 73. However, it found that the brought forward losses were correctly set off against speculative business income of the current year, and therefore, there was no mistake apparent from the record.

What were the facts?

The Assessing Officer (AO) rectified the assessment order under Section 154, disallowing brought forward business losses of Rs. 42,50,204/- on the grounds that these were speculative losses and could not be set off against non-speculative business income. The assessee argued that the nature of business remained the same and the losses were correctly set off.

What were the issues?

Whether brought forward speculative business losses can be set off against non-speculative business income, and whether the AO was justified in rectifying the original assessment order under Section 154.

Which sections of the Income-tax Act were involved?

Section 154,Section 73,Section 143(3)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, LUCKNOW BENCH “A”, LUCKNOW

Before: SHRI. A. D. JAIN & SHRI T. S. KAPOOR

For Appellant: Shri Rakesh Garg, Advocate
For Respondent: Shri Ajay Kumar, D.R

PER A. D. JAIN, V.P.: This is assessee’s appeal against the order of the ld. CIT(A)-II, Kanpur, dated 23/5/2017 for the assessment year 2010-11, taking the following grounds of appeal: (1) Learned C.I.T.(A) has altogether failed to appreciate that there was no mistake in the assessment order passed by Learned A.O. so as to warrant any rectification u/s 154 of the Act. (2) Learned C.I.T.(A) has been guided by irrelevant considerations and misappreciation of facts on record, as also section 73 of the Act and the Explanation thereto read with the law enshrined in section 154 of The Act, in as much as he has failed to appreciate that the learned Dy. C.I.T. altogether ignored, or had otherwise not considered the replies filed on record in respons

The order continues below.

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