Section 73 of the Income Tax Act

Income-tax Act, 2025: s.113

Section 73 of the Income-tax Act, 1961 corresponds to section 113 (Set off and carry forward of losses computed in respect of speculation business) of the Income-tax Act, 2025.

Read section 113 of the 2025 Act

Correspondence checked against the ICAI tabular mapping of the two Acts and the BharatTax.co section commentary.

The decision most relied on for Section 73 is 3. CIT v. ASHOK KUMAR SONI (262 ITR 633), cited in 101 of the 521 judgments on BharatTax that turn on this section.

Leading authorities on Section 73

3. CIT v. ASHOK KUMAR SONI
262 ITR 633 · 2003 · High Court
101
citing judgments

This case is cited for the proposition that oral admissions made during the course of a search can be considered as evidence.

CIT v. DLF Commercial Developers Ltd.
35 Taxmann.com 280 · 2013 · High Court
51
citing judgments

Loss incurred by certain types of companies in trading derivatives is considered speculative loss under the Explanation to Section 73, as the value of stock derivatives depends on shares. Such speculative losses are ineligible for set-off or carry forward against business income.

Ravindranathan Nair v. CIT
247 ITR 178 · 2001 · Supreme Court
42
citing judgments

The Income Tax Appellate Tribunal is the final fact-finding authority. A High Court can only interfere with the Tribunal's factual findings if a specific question alleging perversity of such findings, in the sense that they could not have been reasonably arrived at, has been referred to it.

M/s Liberty India Vs. CIT 225 CTR 233(SC), CIT v. Sterling Foods
227 ITR 557 · 1997 · Supreme Court
32
citing judgments

Income from a deferred VAT rebate granted by a state government for sales tax incentives is not considered income derived from an industrial undertaking and is therefore not eligible for deduction under Section 80IC.

CIT v. Darshan Securities (P) Ltd.
341 ITR 556 · 2012 · High Court
27
citing judgments

A company involved in the purchase and sale of shares is deemed to be carrying on a speculative business to the extent of such transactions, unless it falls under an exception to Section 73 of the Income Tax Act.

Patnaik & Co. Ltd. v. CIT
161 ITR 365 · 1986 · Supreme Court
26
citing judgments

Losses arising from the sale of investments made for business purposes are treated as business losses, not capital losses.

CIT v. VGR Foundations
298 ITR 132 · 2008 · High Court
21
citing judgments

Interest earned by a company on share application money deposited in banks is taxable as income from other sources, even if the funds are intended for the business.

Snowtex Investment Limited v. PCIT
414 ITR 227 · 2019 · Supreme Court
16
citing judgments

The Supreme Court held that losses from delivery-based share trading cannot be set off against profits from derivatives trading if the principal business of the assessee is not the granting of loans and advances, as per the explanation to Section 73.

TRF Ltd. v. CIT
323 ITR 167 · Reported
12
citing judgments

After April 1, 1989, it is sufficient to write off a debt as irrecoverable in the books to claim a bad debt deduction; it is not necessary to establish that the debt has become irrecoverable.

CIT v. HSBC Securities and Capital Market India Private Limited
208 Taxmann 439 · 2012 · High Court
10
citing judgments

Judgments on Section 73

ITO, WD -3(1)(1), Mumbai vs. Arandi Investments Pvt. Ltd., Mumbai

In the result, the appeal by the Revenue is partly allowed for statistical purpose

ITA 2330/MUM/2016[2011-12]Status: DisposedITAT Mumbai05 Jan 2018AY 2011-12

Bench: Shri Shamim Yahya, Am & Shri Sandeep Gosain, Jm आयकर अपील सं./I.T.A. No. 2330/Mum/2016 ("नधा"रण वष" / Assessment Year: 2011-12) Ito, Ward-3(1)(1), M/S. Arandi Investments Pvt. Ltd. बनाम/ Room No. 666, 6Th Floor, 408, Tulsiyani Chambers, Aayakar Bhavan, M. K. Road, Nariman Point, Mumbai-400 021 Vs. Mumbai-400 020 "थायी लेखा सं./जीआइआर सं./Pan/Gir No. Aabca 1755 C (अपीलाथ" /Appellant) (""यथ" / Respondent) : अपीलाथ" क" ओर से / Appellant By : Shri M. V. Rajguru ""यथ" क" ओर से/Respondent By : None सुनवाई क" तार"ख / : 24.10.2017 Date Of Hearing घोषणा क" तार"ख / : 05.01.2018 Date Of Pronouncement आदेश / O R D E R Per Shamim Yahya, A. M.: This Appeal By The Revenue Is Directed Against The Order By The Commissioner Of Income Tax (Appeals) Dated 19.01.2016 & Pertains To The Assessment Year (A.Y.) 2011-12. 2. The Grounds Of Appeal Read As Under: 1. "On The Facts & Circumstances Of The Case & In Law, The Ld. Cit(A) Erred In Directing That The Loss Of Rs.2,46,31,762/- On Account Of Derivative Trading Cannot Be Treated As Speculation Loss & Failed To Appreciate That The Case Of The Assessee Squarely Falls Within Ambit Of Explanation To S.73 Of The I.T. Act"

For Appellant: Shri M. V. RajguruFor Respondent: None
Section 14ASection 2Section 43(5)(d)Section 72Section 73

Siddhesh Capital Market Services P.Ltd, Mumbai vs. DCIT Cir 3(3), Mumbai

Appeal of the AO is dismissed

ITA 2517/MUM/2015[2010-11]Status: DisposedITAT Mumbai01 Jan 2018AY 2010-11

Bench: S/Shri Rajendra, A.M. & Amarjit Singh, J.M. आयकर अपील सुं./Ita No. 6532/Mum/2012,धनधावरण र्र्व /Assessment Year: 2009-10 M/S.Siddhesh Capital Market Services Dy. Commissioner Of Income Tax, P.Ltd,122, Maker Chamber Iii, Circle-3(3), Vs. Nariman Point, Mumbai – 400021 Mumbai. Pan: Aaccs4582N (अपीलाथी /Appellant) (प्रत्यथी / Respondent) आयकर अपील सुं./Ita No.2489/Mum/2015 धनधावरण र्र्व /Assessment Year: 2010-11 Dy. Commissioner Of Income Tax, M/S.Siddhesh Capital Market Services, Vs. Circle-3(3),Mumbai. Nariman Point, Mumbai – 400021 आयकर अपील सुं./Ita No.2517/Mum/2015 धनधावरण र्र्व /Assessment Year: 2010-11 M/S.Siddhesh Capital Market Services, Dy. Commissioner Of Income Tax, Vs. Nariman Point, Mumbai – 400021 Circle-3(3),Mumbai. Revenue By: Shri V. Justin-Dr Assessee By: Shri Vijay Mehta स नर्ाई की तारीख / Date Of Hearing: 03/10/2017 घोर्णा की तारीख / Date Of Pronouncement: 01/01/2018 आयकर अधधधनयम,1961 की धारा 254(1) के अन्द्तगवत आदेश Order U/S.254(1)Of The Income-Tax Act,1961(Act) लेखा सदस्य,राजेन्द्र के अन सार -Per Rajendra,Am: Challenging The Orders Dated 26.06.2012 & 12.01.2015 Of Cit(A)-7 & Cit-8,Respectively, The Assessee & The Assessing Officer(Ao)Have Filed Appeals For The Above-Mentioned Two Assessment Years.As The Issues Involved In Both The Appeals Are Common,So,We Are Adjudicat- Ing Them Together. Assessee-Company Is Engaged In The Business Of Finance,Trading, Investment & Derivative Transaction In Shares & Securities. The Details Of Filing Of Returns, Returned Incomes,Dates Of Assessments & Assessed Incomes Can Be Tabulated As Under: Ay. Roi Filed On Returned Income Asstt.Date Assessed Income 09-10 22.09.2009 (-) Rs.81,01,51,079/- 30.11.2011 (-) Rs.80,82,06,669/- 10-11 21.09.2010 Rs. 48,14,034/- 11.02.2013 Rs. 49,72,360/-

For Appellant: Shri Vijay MehtaFor Respondent: Shri V. Justin-DR
Section 10(34)Section 14ASection 254(1)Section 35Section 35D

DCIT Cir 3(3)(1), Mumbai vs. Siddhesh Capital Market Services P.Ltd, Mumbai

Appeal of the AO is dismissed

ITA 2489/MUM/2015[2010-11]Status: DisposedITAT Mumbai01 Jan 2018AY 2010-11

Bench: S/Shri Rajendra, A.M. & Amarjit Singh, J.M. आयकर अपील सुं./Ita No. 6532/Mum/2012,धनधावरण र्र्व /Assessment Year: 2009-10 M/S.Siddhesh Capital Market Services Dy. Commissioner Of Income Tax, P.Ltd,122, Maker Chamber Iii, Circle-3(3), Vs. Nariman Point, Mumbai – 400021 Mumbai. Pan: Aaccs4582N (अपीलाथी /Appellant) (प्रत्यथी / Respondent) आयकर अपील सुं./Ita No.2489/Mum/2015 धनधावरण र्र्व /Assessment Year: 2010-11 Dy. Commissioner Of Income Tax, M/S.Siddhesh Capital Market Services, Vs. Circle-3(3),Mumbai. Nariman Point, Mumbai – 400021 आयकर अपील सुं./Ita No.2517/Mum/2015 धनधावरण र्र्व /Assessment Year: 2010-11 M/S.Siddhesh Capital Market Services, Dy. Commissioner Of Income Tax, Vs. Nariman Point, Mumbai – 400021 Circle-3(3),Mumbai. Revenue By: Shri V. Justin-Dr Assessee By: Shri Vijay Mehta स नर्ाई की तारीख / Date Of Hearing: 03/10/2017 घोर्णा की तारीख / Date Of Pronouncement: 01/01/2018 आयकर अधधधनयम,1961 की धारा 254(1) के अन्द्तगवत आदेश Order U/S.254(1)Of The Income-Tax Act,1961(Act) लेखा सदस्य,राजेन्द्र के अन सार -Per Rajendra,Am: Challenging The Orders Dated 26.06.2012 & 12.01.2015 Of Cit(A)-7 & Cit-8,Respectively, The Assessee & The Assessing Officer(Ao)Have Filed Appeals For The Above-Mentioned Two Assessment Years.As The Issues Involved In Both The Appeals Are Common,So,We Are Adjudicat- Ing Them Together. Assessee-Company Is Engaged In The Business Of Finance,Trading, Investment & Derivative Transaction In Shares & Securities. The Details Of Filing Of Returns, Returned Incomes,Dates Of Assessments & Assessed Incomes Can Be Tabulated As Under: Ay. Roi Filed On Returned Income Asstt.Date Assessed Income 09-10 22.09.2009 (-) Rs.81,01,51,079/- 30.11.2011 (-) Rs.80,82,06,669/- 10-11 21.09.2010 Rs. 48,14,034/- 11.02.2013 Rs. 49,72,360/-

For Appellant: Shri Vijay MehtaFor Respondent: Shri V. Justin-DR
Section 10(34)Section 14ASection 254(1)Section 35Section 35D

Siddhesh Capital Market Services P.Ltd, Mumbai vs. DCIT Cir 3(3), Mumbai

Appeal of the AO is dismissed

ITA 6532/MUM/2012[2009-10]Status: DisposedITAT Mumbai01 Jan 2018AY 2009-10

Bench: S/Shri Rajendra, A.M. & Amarjit Singh, J.M. आयकर अपील सुं./Ita No. 6532/Mum/2012,धनधावरण र्र्व /Assessment Year: 2009-10 M/S.Siddhesh Capital Market Services Dy. Commissioner Of Income Tax, P.Ltd,122, Maker Chamber Iii, Circle-3(3), Vs. Nariman Point, Mumbai – 400021 Mumbai. Pan: Aaccs4582N (अपीलाथी /Appellant) (प्रत्यथी / Respondent) आयकर अपील सुं./Ita No.2489/Mum/2015 धनधावरण र्र्व /Assessment Year: 2010-11 Dy. Commissioner Of Income Tax, M/S.Siddhesh Capital Market Services, Vs. Circle-3(3),Mumbai. Nariman Point, Mumbai – 400021 आयकर अपील सुं./Ita No.2517/Mum/2015 धनधावरण र्र्व /Assessment Year: 2010-11 M/S.Siddhesh Capital Market Services, Dy. Commissioner Of Income Tax, Vs. Nariman Point, Mumbai – 400021 Circle-3(3),Mumbai. Revenue By: Shri V. Justin-Dr Assessee By: Shri Vijay Mehta स नर्ाई की तारीख / Date Of Hearing: 03/10/2017 घोर्णा की तारीख / Date Of Pronouncement: 01/01/2018 आयकर अधधधनयम,1961 की धारा 254(1) के अन्द्तगवत आदेश Order U/S.254(1)Of The Income-Tax Act,1961(Act) लेखा सदस्य,राजेन्द्र के अन सार -Per Rajendra,Am: Challenging The Orders Dated 26.06.2012 & 12.01.2015 Of Cit(A)-7 & Cit-8,Respectively, The Assessee & The Assessing Officer(Ao)Have Filed Appeals For The Above-Mentioned Two Assessment Years.As The Issues Involved In Both The Appeals Are Common,So,We Are Adjudicat- Ing Them Together. Assessee-Company Is Engaged In The Business Of Finance,Trading, Investment & Derivative Transaction In Shares & Securities. The Details Of Filing Of Returns, Returned Incomes,Dates Of Assessments & Assessed Incomes Can Be Tabulated As Under: Ay. Roi Filed On Returned Income Asstt.Date Assessed Income 09-10 22.09.2009 (-) Rs.81,01,51,079/- 30.11.2011 (-) Rs.80,82,06,669/- 10-11 21.09.2010 Rs. 48,14,034/- 11.02.2013 Rs. 49,72,360/-

For Appellant: Shri Vijay MehtaFor Respondent: Shri V. Justin-DR
Section 10(34)Section 14ASection 254(1)Section 35Section 35D