The ACIT, Circle 5, RAJKOT-GUJARAT V. Shri Shashikant H Koticha, RAJKOT-GUJARAT

ITA 1118/RJT/2010

• Counselvise Citation: 111824914 RSA 2010
• Duration Of Justice: 1 year(s) 1 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-09-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 26-09-2011
• Assessment Year: 1999-2000
• Appeal Filed On: 20-08-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MK SINGH
• Keywords: Capital asset; Business income

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL RAJKOT BENCH, RAJKOT BEFORE SHRI D.K. TYAGI (JUDICIAL MEMBER) AND SHRI A .L. GEHLOT (AM) I.T.A. NO.1118/RJT/2010 (ASSESSMENT YEAR 1999-2000) ACIT, CIR.5 VS SHRI SHASHIKANT H KOTICHA RAJKOT AJAY MANSION, MALVIYA ROAD OPP SAURASHTRA COLD STORAGE RAJKOT PAN : NOT AVAILABLE (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI MK SINGH RESPONDENT BY: SHRI KALPESH DOSHI DATE OF HEARING : 26-09-2011 DATE OF PRONOUNCEMENT : 30-09-2011 O R D E R PER D.K. TYAGI, JM THIS APPEAL OF THE REVENUE IS DIRECTED AGAINST THE ORDER OF CIT(A)-IV, RAJKOT DATED 08-06-2010 AND PERTAINS TO ASSESSMENT YEAR 1999-2000. 2. THE EFFECTIVE GROUND RAISED IN THE APPEAL IS THA T THE CIT(A) ERRED IN LAW AND ON FACT IN DELETING ADDITION MADE BY THE AO OF RS.20,94,521 ON ACCOUNT OF THE PROFITS ON SALE OF SHARES TO TREAT T HE SAME AS CAPITAL GAIN IN STEAD OF AS BUSINESS INCOME. ITA NO.1118/RJT/2010 2 3. THE ASSESSEE HAS SHOWN LONG TERM CAPITAL GAIN OF RS.10,17,396 ON SALE OF SHARES AND SAURASHTRA KUTCH STOCK EXCHANGE CARD (MEMBERSHIP CARD). WHEN ASKED TO EXPLAIN THE ASSESSEE STATED T HAT THE ASSETS IN QUESTION WERE HELD BY HIM AS CAPITAL ASSETS AND THE REFORE, THE NATURE OF THE TRANSACTIONS WAS IN THE FORM OF INVESTMENT AND THE PROFIT ARISING THEREFROM CAN BE TAXED ONLY UNDER THE HEAD CAPITAL GAIN. THE ASSESSING OFFICER OBSERVED THAT RECORD SHOWED THAT IN THE PAS T THREE YEARS THE ASSESSEE HAD SOLD THE SHARES OF THE HANDSOME AMOUNT AND WAS CLAIMING EVERY YEAR PROFIT FROM THE SAME AS CAPITAL GAIN. T HEREFORE, THE ASSESSING OFFICER WAS OF THE VIEW THAT THE BEHAVIOUR OF THE A SSESSEE SHOWED THAT THE SHARES REFLECTED IN THE PERSONAL BOOKS OF ACCOUNT S HOWED UNDER ANY HEAD WERE FOR THE PURPOSE OF TRADING, WHICH PROVES THAT THE TRANSACTIONS WERE ADVENTURE IN THE NATURE OF TRADE AND IT IS A COLOUR ABLE DEVICE TO REDUCE THE BUSINESS INCOME. ACCORDINGLY, THE ASSESSING OFFICE R MADE AN ADDITION OF RS.11,67,840 TO THE INCOME DISCLOSED BY THE ASSESSE E TREATING THE TRANSACTION AS ADVENTURE IN THE NATURE OF TRADE. 4. ON APPEAL, THE CIT(A) FOUND THAT UNDER SIMILAR F ACTS AND CIRCUMSTANCES, IN THE CASE OF ASSESSEE AND HIS FAMI LY MEMBERS FOR ASSESSMENT YEAR 1994-95 THE APPEALS HAVE BEEN ALLOW ED BY THE CIT(A) BY DIRECTING THE ASSESSING OFFICER TO TREAT THE INCOME UNDER QUESTION AS INCOME FROM CAPITAL GAINS AND NOT AS BUSINESS INC OME WHICH WAS UPHELD ITA NO.1118/RJT/2010 3 BY THE ITAT IN ITA NO. 49/RJT/99 & OTHERS. THE LD. CIT(A) ALSO FOUND THAT THE ABOVE ORDER OF THE TRIBUNAL UPHOLDING THE ORDER OF CIT(A) WAS UPHELD BY THE GUJARAT HIGH COURT ALSO. THESE FACTS REMAIN UNCONTROVERTED BEFORE US. IN SUCH A SITUATION, THERE REMAINS LITTLE SCOP E FOR US TO INTERFERE WITH THE ORDER OF THE CIT(A). ACCORDINGLY WE CONFIRM THE OR DER OF CIT(A). 5. IN THE RESULT, APPEAL FILED BY THE REVENUE IS DI SMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 30-09-2011. SD/- SD/- (A.L. GEHLOT) (D.K. TYAGI) ACCOUNTANT MEMBER JUDICIAL MEMBER RAJKOT, DT : 30 TH SEPTEMBER, 2011 PK/- COPY TO: 1. ASSESSEE 2. REVENUE 3. THE CIT(A)-IV, RAJKOT 4. THE CIT, III, RAJKOT 5. THE DR, I.T.A.T., RAJKOT (TRUE COPY) BY ORDER ASSTT.REGISTRAR, ITAT, RAJKOT