Case Law Details
Amit Agarwal Vs ITO (ITAT Kolkata)
Introduction: The Income Tax Appellate Tribunal (ITAT) Kolkata recently addressed an appeal filed by Amit Agarwal against the disallowance of interest on unsecured loans. The appeal dealt with two key issues – the addition related to the purchase and sale of future/options and the disallowance of interest on unsecured loans. This article provides a detailed analysis of the case and the ITAT’s ruling.
Detailed Analysis:
1. Background of the Case: Amit Agarwal’s appeal is directed against the order of the Commissioner of Income Tax (Appeals)-NFAC, Delhi (CIT(A)) for the Assessment Year 2015-16. The appeal raised two main grounds: a. The addition of Rs. 6,63,623 related to the purchase of forward transactions of future/options. b. The disallowance of interest of Rs. 2,05,000 on unsecured loans of Rs. 37,42,250.
2. Issue of Purchase and Sale of Future/Options: The Assessing Officer (AO) observed that the appellant made purchases of future/options on the National Stock Exchange amounting to Rs. 8,72,352 but only sold Rs. 2,08,731 worth, carrying forward the remaining Rs. 6,63,623. The AO disallowed this amount, as the losses were not disclosed in the return of income.
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