Case Law Details
Vision Millenium Exports P. Ltd. Vs DCIT (ITAT Mumbai)
ITAT Mumbai held that loss arising on settlement of contracts has to be treated as speculation loss and speculative losses are not eligible for set off against the non-speculation profit.
Facts- The assessee e-filed return of income on 29.09.2015 declaring total loss of Rs.25,50,57,463/ -. The return of income filed by the assessee was selected for scrutiny and statutory notices u/s under Income-tax Act, 1961 were served upon the assessee. The assessment was completed on 21.12.2017 after disallowing the loss of Rs.26,88,98,500/ – on the ground same being not genuine and also being speculative loss ,therefore the assessee not eligible for set off against non-speculation business income. On further appeal, the Ld. CIT(A) also upheld the disallowance of loss. Being aggrieved, the present appeal is filed.
Conclusion- The loss arising on settlement of contracts has to be treated as speculation loss u/s.43(5) and consequently, the same would not be available for set of except against profits and gains, if any, of another speculation business in view of the provisions of section 73(1) of the Act.
Before us, no documentary evidence or explanation has been given by the assessee to controvert the finding of the lower authorities. The lower authorities have duty observed that the contract for purchase transactions were made within the related parties, no actual payment was made, the debit notes was printed on the letter head of AMPL and BOL without any identification numbers, transactions were not carried out on any commodity exchange, agreement was not stamped etc. In absence of any documentary evidence to contradict the finding of the Ld. CIT(A), we have no option other than to uphold the finding of the Ld. CIT(A). We accordingly uphold the order of ld CIT(A). The grounds of appeal of the assessee are dismissed.
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