A New Delhi bench of the ITAT in the case M/s. Sucon India Ltd. Vs. JCIT held that loss suffered by assessee on derivative transaction is not speculative loss and as such eligible to be adjusted against business income.
The sole issue was regarding the addition made by Assessing Officer on account of claim of set off of loss of share business. In the instant case, the Assessee engaged in the business of trading in shares and securities file his return of income declaring a loss.
Since AO made the addition, Assessee carried the matter to CIT (A) where partly allowed the appeal. Further aggrieved Assessee approached this tribunal and pressed the decision of co-ordinate bench of Tribunal in assessee’s own case M/s. Sucon India Ltd. vs. ACIT were decision was in favour of Assessee.
Finally, the bench comprising Judicial Member Kuldip Singh and Accountant Member Prashanth Maharishi allowed the appeal of Assessee by relied on Assessee’s own case and held that loss incurred by Assessee on derivative transaction is not speculative loss and as such eligible to be adjusted against business income and Explanation 73 of the Income Tax Act is not attracted.
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