Cfl Capital Financial Services Ltd., ... vs Dcit, Circle - 6, Kolkata, Kolkata on 17 November, 2017
j. The assessee neither proved that there was underlying asset nor
furnished any confirmation in this regard (i.e. details the underlying
asset) from the Bank(s) with whom such contracts were entered.
k. The Nature, Frequency and the volume of transactions also
strengthen the fact that the assessee had entered numerous contracts
which even outstate the number of exports/export invoices that the
assessee would have made in the ordinary course of business. The
nature of transaction by way of Buy and Sell Forex derivatives coupled
with swap and cross currency pegging. The frequency and the
:-6-: ITA Nos. 1759 & 1760/Mds/2016
magnitude/ quantum of such exotic forward contracts entered by the
assessee clearly establishes that the assessee's act was only of
speculative in nature in order earn profit not only through regular
business activities but also through such exotic forex derivative
contracts. Any such act falls within the ambit of S.43(5).
l. In the decision of Comfund Financial Services(l) Ltd vs DCIT, The
ITAT Bangalore bench has also held that " Even the definition of the
word "commodity" as per Oxford Illustrated Dictionary is "useful thing;
article of trade" When the Court of Appeal (in an English judgement)
held even dollar, which is nothing but a currency also to represent a
commodity, we find no difficulty in holding that shares and securities
and also units of UTI should also be considered as commodity .... "