DCIT, C-1, Ludhiana V. M/s Khurana Rolling Mills Pvt. Ltd., Ludhiana

ITA 258/CHANDI/2018

• Counselvise Citation: [2019] 111 COUNSELVISE.COM (IT) 9356 (ITAT-CHANDIGARH)
• Duration Of Justice: 1 year(s) 9 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-12-2019
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Bench Allotted: A
• Next Hearing Date: 03-10-2019
• Assessment Year: 2013-2014
• Appeal Filed On: 01-03-2018
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: ARVIND SUDERSHAN SR DR
• Keywords: Unexplained cash credit; Business income; Income from undisclosed sources; Transactions in derivatives; Deemed to accrue or arise in india; Set aside; Capital Gains
• Section: 271(1)(c); 44AB; 68

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL DIVISION BENCH, A, CHANDIGARH . . , , BEFORE SHRI N.K. SAINI, VICE PRESIDENT & SHRI SANJAY GARG, JUDICIAL MEMBER ./ ITA NO. 667/CHD/2017 / ASSESSMENT YEARS : 2013-14 M/S KHURANA ROLLING MILLS PVT.LTD., VILL RAM GARH, CHANDIGARH ROAD, LUDHIANA VS. ! THE ACIT, CIRCLE-1, LUDHIANA ' # ./ PAN NO: AADCK2182R '$/ APPELLANT &' '$ / RESPONDENT & ./ ITA NO. 258/CHD/2018 / ASSESSMENT YEARS : 2013-14 THE DCIT, CIRCLE-1, LUDHIANA VS. ! M/S KHURANA ROLLING MILLS PVT.LTD., VILL RAM GARH, CHANDIGARH ROAD, LUDHIANA ' # ./ PAN NO: AADCK2182R '$/ APPELLANT &' '$ / RESPONDENT ()*+ /ASSESSEE BY : SH. SUDHIR SEHGAL, ADVOCATE *+ / REVENUE BY : SH. ARVIND SUDERSHAN, SR.DR , -*) .# /DATE OF HEARING : 3.10.2019 /0 *) .# / DATE OF PRONOUNCEMENT : 20.12. 2019 / ORDER PER SANJAY GARG, JUDICIAL MEMBER: THE CAPTIONED APPEALS, ONE BY THE ASSESSEE AND OTHE R BY THE REVENUE HAVE BEEN PREFERRED AGAINST THE SEPARATE ORDERS DATED 2 ITA NOS. 66 7-C-2017 & 258-C-2018- KHURANA ROLLING MIL LS PVT LTD., LUDHIANA 31.03.2017 & 14.12.2017 OF THE COMMISSIONER OF INCO ME TAX (APPEALS)-1, LUDHIANA HEREINAFTER REFERRED TO AS CI T(A)]. 2. FIRST, WE SHALL DEAL WITH THE APPEAL OF THE ASS ESSEE IT ITA NO. 667/CHD/2017 FOR ASSESSMENT YEAR 2013-14, WHEREIN, FOLLOWING GROUNDS HAVE BEEN TAKEN BY THE ASSESSEE:- 1. THAT THE WORTHY COMMISSIONER OF INCOME TAX ( APPEALS) HAS ERRED IN DISMISSING THE APPEAL FILED BY THE APPELLA NT. 2.A). THAT THE LD. CIT(A) HAS ERRED IN CONFIRMING THE ADDITION OF RS. 1,74,10,040/- MADE BY THE ASSESSING OFFICER BY HOLDING THAT THE ASSESSING OFFICER WAS JUSTIFIED IN TREATING THE INCOME AT RS. 1,74,10,040/- DECLARED B Y THE APPELLANT, AS UNEXPLAINED CREDIT U/S 68 OF THE INCO ME TAX AS PER PARA 3.8 OF HIS ORDER. B). THAT THE LD. ASSESSING OFFICER HAS ERRED IN NOT CONSIDERING THAT IN FACT, THE INCOME OF RS. 1,74,10,040/- HAS B EEN DECLARED BY THE APPELLANT AS MISCELLANEOUS INCOME IN THE PRO FIT AND LOSS ACCOUNT ON ACCOUNT OF PROFIT EARNED FROM COMMODITY TRANSACTIONS AS STATED BY THE LD. CIT (A) IN PARA 3 .6 OF HIS ORDER AND NOT UNEXPLAINED CREDIT U/S 68 AS STATED A BOVE. 3. THAT THE LD. CIT(A) HAS ALSO ERRED IN HOLDING THAT THE ASSESSING OFFICER WAS JUSTIFIED IN NOT ALLOWING THE SET OFF OF THE LOSS FROM BUSINESS, AGAINST THE SO CALLED UNEXP LAINED INCOME U/S 68 AS PER PARA 3.9 OF HIS ORDER. 4. THAT THE LD. CIT(A) HAS ERRED IN TREATING THE MISCELLANEOUS INCOME DECLARED IN THE PROFIT AND LOS S ACCOUNT ON ACCOUNT OF SALE AND PURCHASE OF COMMODIT Y TRANSACTIONS AS UNEXPLAINED INCOME U/S 68 OF THE IN COME TAX ACT MERELY FOR NOT PRODUCING THE BROKERS BEFORE THE ASSESSING OFFICER. 5. THAT THE LD. CIT (A) HAS ERRED IN NOT CONSIDERING A ND IGNORING THE FACT THAT SUFFICIENT EVIDENCE HAS BEEN FILED TO PROVE THE IDENTITY OF THE BROKERS BY FURNISHING THE IR PAN, BANK ACCOUNT, CREDIT WORTHINESS AND GENUINENESS OF TRANSACTION BY FURNISHING THE DETAILED REPLY AND AL L THE TRANSACTIONS HAVE BEEN MADE THROUGH NORMAL BANKING CHANNELS. 3 ITA NOS. 66 7-C-2017 & 258-C-2018- KHURANA ROLLING MIL LS PVT LTD., LUDHIANA 6. THAT THE LD. CIT (A) HAS ERRED IN NOT CONSIDERING T HAT THE ASSESSEE COMPANY IS A PVT. LTD. COMPANY DEALING IN IRON & STEEL AND THE ACCOUNTS OF THE ASSESSEE IS SUBJECT T O AUDIT UNDER THE COMPANIES ACT 1956 AS WELL TAX AUDIT U/S 44AB O F THE INCOME TAX ACT. THE ACCOUNTS WERE DULY AUDITED BY T HE CHARTERED ACCOUNTANT AND NO ADVERSE FINDINGS HAS BE EN GIVEN BY THE ASSESSING OFFICER DURING THE SCRUTINY ASSESSMENT U/S 143(3), THOUGH, THE ASSESSING OFFICER CALLED FO R VARIOUS DETAILS OF COMMODITY PROFIT INCOME CREDITED IN THE BOOKS OF ACCOUNTS OF THE ASSESSEE COMPANY, NO DEFECTS HAVE B EEN POINTED OUT IN THE BOOKS OF ACCOUNTS MAINTAINED BY THE APPE LLANT. 7. THAT THE CIT(A) HAS FAILED TO APPRECIATE THE FACT T HAT ALL THE THREE INGREDIENTS I.E. IDENTITY, CREDIT WORTHINESS AND GENUINENESS OF TRANSACTION HAS BEEN PROVED BY THE ASSESSEE AND, AS SUCH, SUSTAINING OF ADDITION IS NO T CALLED FOR. 8. THAT THE ADDITION OF RS. 1,74,10,040/- AS ABOVE HAS BEEN UPHELD AGAINST THE FACTS AND CIRCUMSTANCES OF THE C ASE. 9. THAT THE APPELLANT CRAVES LEAVE TO ADD OR AMEND THE GROUNDS OF APPEAL BEFORE THE APPEAL IS FINALLY HEARD OR D ISPOSED OFF. 3. THE SOLE ISSUE RAISED BY THE ASSESSEE THROUGH ABOVE GROUNDS OF APPEAL IS RELATING TO THE CONFIRMATION TO THE ACTIO N OF THE ASSESSING OFFICER BY THE LD. CIT(A) IN TREATING THE INCOME O F RS. 1,74,10,040/- AS INCOME FROM UNEXPLAINED SOURCES AND ASSESSED U/S 68 OF THE INCOME TAX ACT, 1961 (IN SHORT 'THE ACT') AS AGAINST THE SAME DECLARED BY THE ASSESSEE AS ITS BUSINESS INCOME FORM COMMODITY TRAN SACTIONS., IN THE YEAR UNDER ASSESSMENT, THE ASSESSEE COMPANY HAD SHOWN MISC. INCOME OF RS. 1,74,10,040/- ON ACCOUNT OF COM MODITY PROFIT DERIVED FROM TRADING IN COMMODITIES. HOWEVER, THE A SSESSING OFFICER HELD THAT THE ASSESSEE COULD NOT ESTABLISH WITH REL EVANT EVIDENCE THE 4 ITA NOS. 66 7-C-2017 & 258-C-2018- KHURANA ROLLING MIL LS PVT LTD., LUDHIANA SOURCE OF THE SAID INCOME AND THE GENUINENESS OF T HE ACTIVITIES OF THE ASSESSEE IN RESPECT OF THE AFORESAID COMMODITY TRAD ING ACTIVITY. HE, THEREFORE, TREATED THE SAID COMMODITY PROFIT AS INC OME OF THE ASSESSEE FROM UNEXPLAINED SOURCES AND ASSESSED THE SAME U/S 68 OF THE ACT ON THE GROUND THAT THE SAID INCOME IS NOT RELATING TO ANY DEFINITE SOURCE. HE DISALLOWED THE SET OFF OF THE SAID INCOME OF RS. 1, 74,10,040./- AGAINST THE CURRENT YEAR BUSINESS LOSSES. HE, SEPARATELY A SSESSED THE AFORESAID INCOME OF RS. 1,74,10,040/- U/S 68 OF THE ACT AND C REATED THE IMPUGNED TAX DEMAND. IN APPEAL, THE LD. CIT(A) CONFIRMED T HE ADDITIONS MADE BY THE ASSESSING OFFICER. 4. BEFORE US, THE LD. COUNSEL FOR THE ASSESSEE HAS SUBMITTED THAT THE ASSESSEE HAD PRODUCED BEFORE THE ASSESSING OFFICER ALL THE RELEVANT NECESSARY EVIDENCES TO SHOW THAT THE ASSESSEE HAD E ARNED INCOME OF RS. 1,74,10,040/- FORM COMMODITY TRADING. THAT THE DETA ILS OF THE BROKERS THROUGH WHOM THE ASSESSEE MADE TRANSACTIONS OF PURC HASE / SALES OF METAL (COMMODITY) WERE FURNISHED. THAT THERE WERE TWO BROKERS THROUGH WHOM THE TRANSACTIONS HAD BEEN DONE BY THE ASSESSEE NAMELY (I) SHRI KUBER TRADING COMPANY LUDHIANA AND (II) KASHMIR TRA DING COMPANY, AND FURTHER SUBMITTED THE COPIES OF THE ACCOUNTS O F THE SAID BROKERS IN THE ASSESSEES ACCOUNT. THE LD. COUNSEL FOR THE AS SESSEE HAS SUBMITTED 5 ITA NOS. 66 7-C-2017 & 258-C-2018- KHURANA ROLLING MIL LS PVT LTD., LUDHIANA THAT TO ESTABLISH THE IDENTITY OF THE AFORESAID BRO KERS, THE ASSESSEE FURNISHED THE FOLLOWING DETAILS:- DURING THE RELEVANT YEAR, THE COMMODITY PROFIT HAS BEEN EARNED THROUGH TWO BROKERS NAMELY SHREE KUBER TRADING COMP ANY AND KRISHNA TRADING COMPANY. IN CASE OF SHREE KUBER TRADING CO., THE ASSESSEE CO MPANY PROVIDED THE FOLLOWING DETAILS: 1. THE FIRM IS OWNED BY ABHINDAN SHARMA AS PROPRIETOR 2. BROKER MAINTAINING BANK ACCOUNT WITH CENTRAL BANK O F INDIA, MADHOK COMPLEX, FEROZEPUR ROAD, CURRENT ACCOUNT NO. 3165427289 3. BROKER MAINTAINING BANK ACCOUNT WITH STATE BANK OF INDIA, FEROZEPUR GANDHI MARKET, CURRENT ACCOUNT NO. 308205 70962 4. THE BROKER HAVING OFFICE AT LSE BUILDING, FEROZE GANDHI MARKET, LUDHIANA DURING THE YEAR UNDER CONSIDERATION AND LA TER ON SHIFTED TO OFFICE AT 1172, KARNAL GURDIAL SINGH ROA D, CIVIL LINES, LUDHIANA AS PROVIDED BY THE BANKERS OF THE BROKERS (COPY OF BANK ACCOUNT ENCLOSED AT PAGE 6 OF THE PAPER BOOK) 5. DOCUMENT PROVIDED BY THE CENTRAL BANK OF INDIA, MADHOK COMPLEX, FEROZEPUR ROAD, LUDHIANA:- I) COPY OF PAN OF THE PROPRIETOR II) COPY OF RENT DEED III) COPY OF VOTER'S IDENTITY CARD OF THE PRO PRIETOR IV) COPY OF DRIVING LICENSE OF THE PROPRIETOR ( ALL ENCLOSED AT PAGE 7 OF THE PAPER BOOK) 6. DOCUMENTS PROVIDED BY THE STATE BANK OF INDIA, STOCK EXCHANGE, FEROZE GANDHI MARKET, LUDHIANA:- I) COPY OF BANK ACCOUNT OPENING FORM 6 ITA NOS. 66 7-C-2017 & 258-C-2018- KHURANA ROLLING MIL LS PVT LTD., LUDHIANA II) COPY OF PAN OF THE PROPRIETOR III) COPY OF TELEPHONE BILL COPY OF RECEIPT OF MUNICIPAL CORPORATION LUDHIANA (ALL ENCLOSED AT PAGE 8 OF THE PAPER BOOK) THE LD. AR OF THE ASSESSEE HAS FURTHER SUBMITTED TH AT THE FOLLOWING DETAILS IN RESPECT OF THE TRANSACTIONS WERE SUBMITT ED: I. COPIES OF PURCHASE/SALE CONTRACT NOTES SHOWING QUAN TITY OF METAL PURCHASE, QUANTITY OF METAL SOLD, BROKERAGE P AID TO THE BROKER AND PROFIT/LOSS ON EACH TRANSACTION (ENCLOSE D AT PAGE 2 OF THE PAPER BOOK) II. CONSOLIDATED TRADING ACCOUNT OF VARIOUS METALS TRAD ED BY THE ASSESSEE (ENCLOSED AT PAGE 3 OF THE PAPER BOOK) III. BROKER WISE TRADING ACCOUNT OF VARIOUS METALS (ENCL OSED AT PAGE 4 OF THE PAPER BOOK) IV. DETAILS OF PROFIT EARNED TRANSACTION WISE ON PURCHA SE/SALE OF VARIOUS METALS. V. CONFIRMED COPIES OF ACCOUNTS OF THE ASSESSEE COMPAN Y ACCOUNTS IN THE BOOKS OF THE BROKER (ENCLOSED AT PA GE 5 OF THE PAPER BOOK) 5. THE LD. AR OF THE ASSESSEE HAS FURTHER SUBMITTED THAT THE ASSESSING OFFICER TREATED THE INCOME FROM COMMODI TY TRANSACTIONS AS DEEMED INCOME FROM UNDISCLOSED SOURCES U/S 68 OF TH E ACT ONLY BECAUSE THE BROKER DID NOT APPEAR BEFORE THE ASSESSING OFFI CER. THAT, HOWEVER, THE ASSESSEE HAD FULLY DISCHARGED ITS BURDEN TO PRO VE THE IDENTITY OF THE BROKERS AND GENUINENESS OF THE TRANSACTIONS. THAT E VEN THE NAMES AND 7 ITA NOS. 66 7-C-2017 & 258-C-2018- KHURANA ROLLING MIL LS PVT LTD., LUDHIANA OTHER DETAILS OF THE PARTIES WITH WHOM THE TRANSACT IONS WERE CARRIED OUT WERE ALSO SUPPLIED. HE, THEREFORE, HAS SUBMITTED TH AT THERE WAS NO JUSTIFICATION ON THE PART OF THE ASSESSING OFFICER TO SEPARATELY ASSESS THE INCOME OF THE ASSESSEE FROM COMMODITY TRANSACT IONS U/S 68 OF THE ACT AND NOT ALLOWING THE SET OFF OF THE SAME AGAINS T THE BUSINESS LOSS OF THE ASSESSEE. 6. THE LD. DR, ON THE OTHER HAND, HAS RELIED ON THE FINDINGS OF THE LOWER AUTHORITIES. 7. WE HAVE CONSIDERED THE RIVAL CONTENTIONS. THE LD . AR OF THE ASSESSEE HAS DEMONSTRATED FROM THE RECORDS THAT AL L THE REQUISITE DETAILS WERE SUBMITTED TO THE ASSESSING OFFICER TO PROVE TH E GENUINENESS OF THE TRANSACTIONS ENTERED INTO BY THE ASSESSEE IN COMMO DITY TRADING ACTIVITY. IN OUR VIEW, MERELY BECAUSE THE BROKERS HAD NOT APP EARED IN RESPONSE TO THE SUMMONS SENT BY THE ASSESSING OFFICER THAT ITSE LF CANNOT BE THE SOLE GROUND TO REJECT THE ENTIRE EVIDENCE PRODUCED BY TH E ASSESSEE. THE ASSESSEE NOT ONLY FURNISHED THE NAMES AND ADDRESSE S OF THE BROKERS AND THE OTHER CONCERNED PARTIES BUT ALSO THE OTHER DETA ILS LIKE THEIR PAN NUMBERS, BANK ACCOUNT DETAILS AND EVEN THE TRADING LICENSE, TELEPHONE BILLS AND OTHER EVIDENCES AS DETAILED ABOVE. THE AS SESSEE HAS ALSO PRODUCED THE DETAILS OF THE COMMODITY TRANSACTIONS CARRIED OUT BY THE ASSESSEE ALONGWITH PURCHASE AND SALES INVOICES. 8 ITA NOS. 66 7-C-2017 & 258-C-2018- KHURANA ROLLING MIL LS PVT LTD., LUDHIANA UNDER THE CIRCUMSTANCES, THE ACTION OF THE LOWER AU THORITIES IN ASSESSING THE INCOME U/S 68 OF THE ACT CANNOT BE HELD TO BE JUSTIFIED. EVEN AS PER THE SECTION 71(1) OF THE INCOME TAX ACT, LOSSES , FROM ONE HEAD CAN BE SET OFF AGAINST THE INCOME FROM ANOTHER HEAD OF INCOME. THE PROVISIONS OF SECTION 71(1) ARE REPRODUCED AS BELOW :- SET OFF OF LOSS FROM ONE HEAD AGAINST INCOME FROM ANOTHER. 71. (1) WHERE IN RESPECT OF ANY ASSESSMENT YEAR THE NET RESULT OF THE COMPUTATION UNDER ANY HEAD OF INCOME, OTHER THAN 'CAPITAL GAINS', IS A LOSS AND T HE ASSESSEE HAS NO INCOME UNDER THE HEAD 'CAPITAL GAINS', HE SHALL, SUBJECT TO THE PROVISIONS OF THIS CHAPTER, BE ENTITLED TO HAVE THE AMOUNT OF SUCH LOS S SET OFF AGAINST HIS INCOME, IF ANY, ASSESSABLE FOR THAT ASSESSMENT YEAR UNDER ANY OTHER HEAD. HOWEVER, THE CASE OF THE ASSESSING OFFICER IS THAT THE INCOME ASSESSED U/S 68 OF THE ACT WOULD NOT FALL IN ANY HEAD OF IN COME AS PRESCRIBED U/S 14 OF THE ACT, HENCE, THE SAME WOULD BE DEEMED INCO ME AND SET OFF OF LOSSES AGAINST ANY HEAD OF INCOME IS NOT ALLOWABLE AGAINST THE SAID DEEMED INCOME U/S 68 OF THE ACT. HOWEVER, THE CONTR OVERSY HAS BEEN SETTLED BY THE CBDT CIRCULAR NO. 11 OF 2019 DATED 1 9.6.2019, WHEREIN IT HAS BEEN PROVIDED THAT EVEN IF THE SAID INCOME I S TREATED AS AN INCOME ASSESSED U/S 68 OF THE ACT, STILL THE ASSESSEE IS ENTITLED TO SET OFF OF THE SAID INCOME AGAINST THE BUSINESS LOSS. THE CONTENT S OF THE SAID CBDT CIRCULAR LNO.11/2010 ARE REPRODUCED AS UNDER:- 9 ITA NOS. 66 7-C-2017 & 258-C-2018- KHURANA ROLLING MIL LS PVT LTD., LUDHIANA CIRCULAR NO. 11/2019 GOVERNMENT OF INDIA MINISTRY OF FINANCE DEPARTMENT OF REVENUE CENTRAL BOARD OF DIRECT TAXES NORTH-BLOCK, NEW DELHI, DATED THE 19 TH OF JUNE, 2019 SUBJECT: CLARIFICATION REGARDING NON-ALLOWABILITY O F SET-OFF OF LOSSES AGAINST THE DEEMED INCOME UNDER SECTION 115BBE OF T HE INCOME-TAX ACT, 1961 PRIOR TO ASSESSMENT-YEAR 2017-18-REG. WITH EFFECT FROM 01.04.2017, SUB-SECTION (2) OF SEC TION 115BBE OF THE INCOME-TAX ACT, 1961 (ACT) PROVIDES THAT WHERE TOTAL INCOME OF AN ASSESSEE INCLUDES ANY INCOME REFERRED TO IN SECTION (S) 68/69/69A/69B/69C/69D OF THE ACT, NO DEDUCTION IN R ESPECT OF ANY EXPENDITURE OR ALLOWANCE OR SET OFF OF ANY LOSS SHA LL BE ALLOWED TO THE ASSESSEE UNDER ANY PROVISIONS OF THE ACT IN COMPUTI NG THE INCOME REFERRED TO IN SECTION 115BBE(1) OF THE ACT. 2. IN THIS REGARD, IT HAS BEEN BROUGHT TO THE NOTICE OF THE CENTRAL BOARD OF DIRECT TAXES(THE BOARD) THAT IN ASSESSMENTS PRIO R TO ASSESSMENT YEAR 2017-18, WHILE SOME OF THE ASSESSING OFFICERS HAVE ALLOWED SET OFF OF LOSSES AGAINST THE ADDITIONS MADE BY THEM UNDER SECTION(S) 68/69/69A/69B/69C/69D, IN SOME CASES, SET OFF OF LO SSES AGAINST THE ADDITIONS MADE UNDER SECTION 115BBE(1) OF THE ACT H AVE NOT BEEN ALLOWED. AS THE AMENDMENT INSERTING THE WORDS 'OR SET OFF OF ANY LOSS' IS APPLICABLE WITH EFFECT FROM 1 ST OF APRIL, 2017 AND APPLIES FROM ASSESSMENT YEAR 20 17-18 ONWARDS, CONFLICTING VIEWS HAVE BEEN TAKEN BY THE A SSESSING OFFICERS IN ASSESSMENTS FOR YEARS PRIOR TO ASSESSMENT YEAR 2017 -18. THE MATTER HAS BEEN REFERRED TO THE BOARD SO THAT A CONSISTENT APPROACH IS ADOPTED BY THE ASSESSING OFFICERS WHILE APPLYING PROVISION OF SECTION 115BBE IN ASSESSMENTS FOR PERIOD PRIOR TO THE ASSESSMENT YEAR 2017-18. 3. THE BOARD HAS EXAMINED THE MATTER. THE CIRCULAR NO . 3/2017 OF THE BOARD DATED 20 TH JANUARY, 2017 WHICH CONTAINS EXPLANATORY NOTES TO T HE PROVISIONS OF THE FINANCE ACT, 2016, AT PARA 46.2, REGARDING AMENDMENT MADE IN SECTION 115BBE(2) OF THE ACT MENTIONS THAT CURRENTLY THERE IS UNCERTAINTY ON THE ISSUE OF SET-OFF OF LOSSES AGAIN ST INCOME REFERRED TO IN SECTION 115BBE. IT ALSO FURTHER MENTIONS THAT THE P RE-AMENDED PROVISION OF SECTION 115BBE OF THE ACT DID NOT CONVEY THE INTENT ION THAT LOSSES SHALL NOT BE ALLOWED TO BE SET-OFF AGAINST INCOME REFERRED TO IN SECTION 115BBE OF THE ACT AND HENCE, THE AMENDMENT WAS MADE VIDE THE FINANCE ACT, 2016. 10 ITA NOS. 66 7-C-2017 & 258-C-2018- KHURANA ROLLING MIL LS PVT LTD., LUDHIANA 4. THUS KEEPING THE LEGISLATIVE INTENT BEHIND AMENDME NT IN SECTION 115BBE(2) VIDE THE FINANCE ACT, 2016 TO REMOVE ANY AMBIGUITY OF INTERPRETATION, THE BOARD IS OF THE VIEW THAT SINCE THE TERM 'OR SET OFF OF ANY LOSS' WAS SPECIFICALLY INSERTED ONLY VIDE THE FINAN CE ACT 2016, W.E.F. 01.04.2017, AN ASSESSEE IS ENTITLED TO CLAIM SET-OFF OF LOSS AGAINST INCOME DETERMINED UNDER SECTION 115BBE OF T HE ACT TILL THE ASSESSMENT YEAR 2016-17. 5. THE CONTENTS OF THIS CIRCULAR MAY BE CIRCULATED WI DELY FOR INFORMATION OF ALL STAKEHOLDERS AND DEPARTMENTAL OFFICERS. THE PEN DING ASSESSMENTS AND LITIGATIONS ON THIS ISSUE MAY BE HANDLED ACCORDINGL Y. 6. HINDI VERSION TO FOLLOW. SD/- UNDER SECRETARY (ITA.II), CBDT 8. IN VIEW OF THIS, THERE IS NO MERIT IN THE ACTION OF THE LOWER AUTHORITIES IN MAKING THE IMPUGNED ADDITIONS AND NO T ALLOWING THE SET OFF OF INCOME FROM COMMODITY TRANSACTIONS AS BUSINE SS LOSSES OF THE ASSESSEE. ACCORDINGLY, THE IMPUGNED ORDER OF THE C IT(A) IS SET ASIDE AND THE ADDITIONS MADE BY THE LOWER AUTHORITIES IS ORDERED TO BE DELETED. THE ASSESSING OFFICER IS FURTHER DIRECTED TO SET O FF THE SAID COMMODITY INCOME OF THE YEAR AGAINST THE BUSINESS LOSS. THE APPEAL OF THE ASSESSEE STANDS ALLOWED. ITA NO. 258/CHD/2018 (REVENUES APPEAL) 9. THE REVENUE IN ITS APPEAL IN ITA NO. 258/CHD/201 8 HAS TAKEN FOLLOWING GROUNDS OF APPEAL:- RAJARAJESWAWR.) 11 ITA NOS. 66 7-C-2017 & 258-C-2018- KHURANA ROLLING MIL LS PVT LTD., LUDHIANA 1. WHETHER UPON FACTS AND CIRCUMSTANCES OF THE CASE , THE LD. CIT(A) WAS JUSTIFIED IN LAW AND ON FATS IN DELE TING THE PENALTY IMPOSED U/S 271(1)(C) OF THE INCOME TAX ACT , 1961? 2. THAT THE ORDER OF THE LD. CIT(A) BE SET ASIDE AN D THAT OF THE ASSESSING OFFICER BE RESTORED. 3. THAT THE APPELLANT CRAVES LEAVE TO ADD OR AMEND ANY GROUND OF APPEAL BEFORE IT IS FINALLY DISPOSED OFF. 10. VIDE ABOVE GROUNDS OF APPEAL, THE REVENUE IS A GGRIEVED AGAINST THE ACTION OF THE CIT(A) DELETING THE PENALTY LEVIE D BY THE ASSESSING OFFICER WITH RESPECT TO THE AFORESAID ADDITION MADE BY THE ASSESSING OFFICER U/S 68 OF THE ACT OF INCOME COMMODITY TRAN SACTION. THOUGH THE LD. CIT(A) HAS ALREADY DELETED THE PENALTY LEVIED B Y THE ASSESSING OFFICER OBSERVING THAT IT AS NOT A CASE OF FURNISHI NG OF INACCURATE PARTICULARS OF INCOME OR CONCEALMENT OF PARTICULAR S OF INCOME ON THE PART OF THE ASSESSEE. HOWEVER, SINCE WE HAVE ALREA DY DELETED THE ADDITIONS MADE BY THE ASSESSING OFFICER, NO REASON SUSTAINS FOR LEVY OF THE IMPUGNED PENALTY, THE SAME IS ACCORDINGLY ORDER ED TO BE DELETED. IN VIEW OF THIS, THERE IS NO MERIT IN THE APPEAL OF THE REVENUE AND THE SAME IS ACCORDINGLY DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 20.12.19. SD/- SD/- ( . . / N.K. SAINI) ( / SANJAY GARG) !'# / VICE PRESIDENT $% / JUDICIAL MEMBER 12 ITA NOS. 66 7-C-2017 & 258-C-2018- KHURANA ROLLING MIL LS PVT LTD., LUDHIANA DATED : 20.12.2019 .. 2*&)3454) / COPY OF THE ORDER FORWARDED TO : 1. '$ / THE APPELLANT 2. &' '$ / THE RESPONDENT 3. , 6) / CIT 4. , 6) ( )/ THE CIT(A) 5. 47 &)8 , . 8 , 9:;< / DR, ITAT, CHANDIGARH 6. ;= - / GUARD FILE 2 , / BY ORDER, > / ASSISTANT REGISTRAR