Bhagwati Pulses v/s Income Tax Officer

Parties Involved

Facts Summary

The assessee, Bhagwati Pulses, is engaged in the business of manufacturing and trading in grains and pulses. It filed a return of income on 29/09/2013, declaring total income at ` 1,93,752, which was processed under section 143(1) of the Income Tax Act, 1961 on 15/04/2014. The Assessing Officer found that the assessee incurred losses in trading of Urad and Toor Pulses in particular transactions. The transactions were carried out on the same day without actual delivery of goods, which the assessee could not substantiate. The Assessing Officer concluded that the transactions were speculative and added the loss to the business income of the assessee. The assessee appealed against this order, which was dismissed by the Commissioner of Income Tax (Appeals). The assessee then appealed to the Income Tax Appellate Tribunal.…

Legal Issues

• 1. Whether the Learned CIT(A) was justified in confirming the order of the Learned Assessing Officer by considering the business loss of the appellant as speculative loss.
• 2. Whether the speculative loss should be set-off against profit.

Judgment Outcome

Decided in favour of Assessee.

Precedents Relied Upon

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