Dividend stripping – In cases arising before 1-4-2002, losses pertaining to exempted income cannot be disallowed on ground that same are artificial

JUDGMENT S. H. KAPADIA, J. Delay condoned. Leave granted. Whether the loss arising in the course of dividend stripping transaction taking place prior to 1.4.2002 was dis allowable on the ground that such loss was artificial as the dividend stripping transaction was not a business transaction, is the question which arises for determination in this batch of Civil Appeals; the lead matter of which is C.I.T., Mumbai v. M/s. Walfort Share & Stock Brokers Pvt. Ltd. The facts in the lead matter are as follows: The assessee is a member of Bombay Stock Exchange and it earns income mainly from share...