The Kolkata bench of the Income Tax Appellate Tribunal (ITAT) held that the disallowances/additions of loss cannot be raised when it has not been claimed in the computation of income.
The Assessing Officer during the course of assessment proceedings observed that the assessee made purchases through the National Stock Exchange of future/option of Rs. 8,72,352/- and effected sale to the tune of Rs. 2,08,731/- thereby carrying forward the future & options to the next year to the tune of Rs. 6,63,623/-.
He deducted the said amount from the purchases. Thereafter, the Assessing Officer disallowed the same by observing that the assessee has not disclosed the said losses in the return of income, and the same was not allowed to be carried forward thereby making the addition of Rs. 6,63,623/- to the income of the assessee. The Commissioner of Income Tax (Appeal) [CIT(A)] simply affirmed the order of the Assessing Officer.
The Single-member bench comprising of Rajesh Kumar (Accountant member) held that the assessee has not claimed this loss and therefore, there is no question of disallowance of loss or addition of loss when the same is not claimed in the computation of income. The Assessing Officer has wrongly appreciated the facts of the case which is also in appellate proceedings by CIT(A). In view of the above facts, the bench set aside the order of CIT(A) and directed the Assessing Officer to delete the addition. Thus, the appeal of the assessee was allowed.
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