The DCIT, Circle-3, Surat V. Shri Dr. Bhagirath D.Naik, Surat

ITA 1075/AHD/2011

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 9895 (ITAT-AHMEDABAD)
• Duration Of Justice: 4 year(s) 8 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-01-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Next Hearing Date: 05-01-2016
• Assessment Year: 2008-2009
• Appeal Filed On: 12-04-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SONIA KUMAR
• Keywords: Business income; Retrospective amendment; Tax effect

Judgement Text

, D IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH, AHMEDABAD BEFORE SHRI RAJPAL YADAV, JUDICIAL MEMBER AND SHRI MANISH BORAD, ACCOUNTANT MEMBER ./ ITA.NO.1075/AHD/2011 /BLOCK ASSTT. YEAR: 2008-2009 DCIT, CIR.3 SURAT. VS DR.BHAGIRATH D. NAIK 2-A, SARJAN SOCIETY OPP: SARGAN SHOPPING CENTRE PARLE POINT, SURAT. %& / (APPELLANT) '( %& / (RESPONDENT) REVENUE BY : SMT. SONIA KUMAR, SR.DR ASSESSEE BY : NONE / DATE OF HEARING : 05/01/2016 / DATE OF PRONOUNCEMENT: 05/01/2016 )*/ O R D E R PER RAJPAL YADAV, JUDICIAL MEMBER: THE REVENUE IS IN APPEAL BEFORE US AGAINST THE ORDE R OF LD.COMMISSIONER INCOME-TAX (APPEALS)-II, SURAT DATE D 27.01.2011 PASSED FOR THE ASSTT.YEAR 2008-09. 2. THE LD.AO HAS MADE FOLLOWING COMPUTATION OF INCO ME: AMT.(RS.) TOTAL INCOME, AS PER COMPUTATION OF INCOME FILED ALONG WITH RETURN OF INCOME 54,18,620 LESS: SHORT TERM CAPITAL GAIN TREATED SPARELY 37,32 ,410 ITA NO.1075/AHD/2011 2 TOTAL INCOME 16,86,210 ADD: SHORT TERM CAPITAL GAIN TREATED AS BUSINESS INCOME 37,32,410 TOTAL INCOME 54,18,620 ROUNDED OFF U/S.288A 54,18,620 3. ON APPEAL, THE LD.CIT(A) HAS ACCEPTED THE STAND OF THE ASSESSEE THAT SHORT TERM CAPITAL GAIN DISCLOSED BY HIM ON SALE OF SHARES WILL BE ASSESSED AS A SHORT-TERM CAPITAL GAIN. THE REVENUE IS DISSATISFI ED WITH THIS CONCLUSION OF THE LD.CIT(A). 4. ON VERIFICATION OF THE RECORD, WE FIND THAT IN THE ASSTT.YEAR 2008-09, THE RATE OF TAX ON SHORT TERM CAPITAL GAIN WAS 10%, WHEREAS, IF THE AMOUNT OF RS.37,32,410/- IS TO BE ASSESSED AS BUSINESS INCOME , THE RATE OF TAX WOULD BE 30%. THUS, THE DISPUTE RELATES TO THE DIFFERENCE B ETWEEN THESE TWO RATES. IF THE AMOUNT OF TAX LIABILITY IS BEING CALCULATED ON APPLICATION OF THIS DIFFERENTIAL RATES, THEN THE TAX LIABILITY WOULD BE LESS THAN RS.10 LAKHS. THE TAX LIABILITY BY VIRTUE OF RELIEF GIVEN BY THE CIT( A) IS LESS THAN RS.10 LAKHS. THE CBDT HAS ISSUED INSTRUCTIONS BEARING NO. 21/201 5 PROHIBITING ITS SUBORDINATE AUTHORITIES FROM FILING OF THE APPEAL T O THE TRIBUNAL AGAINST THE ORDER OF THE CIT(A) WHERE THE TAX EFFECT BY VIRTUE OF THE RELIEF GIVEN BY THE CIT(A) IS LESS THAN RS.10 LAKHS. THE INSTRUCTIONS HAVE BEEN MADE APPLICABLE WITH RETROSPECTIVE EFFECT, MEANING THEREBY, THESE I NSTRUCTIONS ARE APPLICABLE ON PENDING APPEALS ALSO. AS PER OUR CALCULATION, T HE TAX EFFECT IN THE PRESENT APPEAL IS LESS THAN RS.10 LAKHS. HOWEVER, WHILE HE ARING THIS APPEAL, SUCH FACTORS COULD NOT BE VERIFIED. THEREFORE, IN CASE ON RE-VERIFICATION AT THE END OF THE AO, IT CAME TO THE NOTICE THAT THE TAX EFFEC T IS MORE OR IT FALLS WITHIN THE AMBIT OF EXCEPTIONS PROVIDED IN THE INSTRUCTION, TH EN DEPARTMENT WILL BE AT LIBERTY TO APPROACH THIS TRIBUNAL FOR RECALL OF THI S ORDER BY MOVING A MISC. ITA NO.1075/AHD/2011 3 APPLICATION. SUCH APPLICATION SHOULD BE FILED WITHI N FOUR YEARS OF THIS ORDER. IN VIEW OF THE ABOVE, THE APPEAL OF THE REVENUE IS DISMISSED. 5. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISSE D. ORDER PRONOUNCED IN THE COURT ON 5 TH JANUARY, 2016 AT AHMEDABAD. SD/- SD/- ( MANISH BORAD ) ACCOUNTANT MEMBER (RAJPAL YADAV) JUDICIAL MEMBER AHMEDABAD; DATED 05/01/2016