73. Losses in speculation
business.- (1) Any loss, computed in respect of a
speculation business carried on by the assessee, shall not
be set off except against profits and gains, if any, of another
speculation business.
(2) Where for any assessment year any loss computed in respect
of a speculation business has not been wholly set off under
sub-section (1), so much of the loss as is not so set off
or the whole loss where the assessee had no income from any
other speculation business, shall, subject to the other provisions
of this Chapter, be carried forward to the following assessment
year, and—
(i) it shall be set off against the profits and gains, if
any, of any speculation business carried on by him assessable
for that assessment year ; and
(ii) if the loss cannot be wholly so set off, the amount
of loss not so set off shall be carried forward to the following
assessment year and so on.
(3) In respect of allowance on account of depreciation or
capital expenditure on scientific research, the provisions
of sub-section (2) of section 72 shall apply in relation to
speculation business as they apply in relation to any other
business.
(4) No loss shall be carried forward under this section for
more than four assessment years immediately succeeding the
assessment year for which the loss was first computed.
Explanation.—Where any part of the business of a company
( other than a company whose gross total income consists mainly
of income which is chargeable under the heads “Interest
on securities”, “Income from house property”,
“Capital gains” and “Income from other sources”,
or a company the principal business of which is the business
of banking or the granting of loans and advances) consists
in the purchase and sale of shares of other companies, such
company shall, for the purposes of this section, be deemed
to be carrying on a speculation business to the extent to
which the business consists of the purchase and sale of such
shares.
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