ACIT-9(1), Hyderabad V. Sri Syed Hameeduddin, Hyderabad

ITA 1219/HYD/2013

• Counselvise Citation: [2013] 140 COUNSELVISE.COM (IT) 69991 (ITAT-HYDERABAD)
• Duration Of Justice: 4 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-12-2013
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2003-2004
• Appeal Filed On: 21-08-2013
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: B SHANTI KUMAR
• Keywords: Unexplained investment; Revision of order
• Section: 143(3); 263

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH A', HYDERABAD BEFORE SHRI CHANDRA POOJARI, ACCOUNTANT MEMBER AND SMT. ASHA VIJAYARAGHAVAN, JUDICIAL MEMBER ITA NO. 1219/HYD/2013 ASSESSMENT YEAR: 2003-04 ASST. COMMISSIONER OF INCOME-TAX, CIRCLE 9(1), HYDERABAD. VS. SRI SYED HAMEEDUDDIN, HYDERABAD. PAN AAHPH7931E APPELLANT RESPONDENT APPELLANT BY: SRI SOLGY JOSET KOTTARAM RESPONDENT BY: SRI B. SHANTI KUMAR DATE OF HEARING: 03/12/2013 DATE OF PRONOUNCEMENT: 03/12/2013 O R D E R PER CHANDRA POOJARI, AM: THIS APPEAL PREFERRED BY THE REVENUE IS DIRECTED AGAINST THE ORDER OF THE CIT(A)-V, HYDERABAD DATED 31/05/2013 WHEREIN THE REVENUE HAS RAISED THE FOLLO WING GROUNDS OF APPEAL: 1. THE ORDER OF CIT(A) IS AGAINST FACTS OF THE CASE . 2. WHETHER THE CIT(A) IS CORRECT IN LAW IN HOLDING THAT THE DATE OF PURCHASE OF THE SHARES IN PHYSICAL FORM AS STATED BY THE ASSESSEE SHOULD BE TAKEN INTO CONSIDERATION, IN THE ABSENCE OF COGENT EVIDENCES, WHICH THE ASSESSEE IS SUPPOSED TO SUBMIT. 3. WHETHER THE CIT(A) IS CORRECT IN LAW IN HOLDING THAT THE CIRCULAR NO. 704 DATED 28/04/1995, SQUARELY APP LIES TO THE CASE OF THE ASSESSEE, WHERE AS THE BOARD HAS SPECIFICALLY MENTIONED IN THE SAID CIRCULAR, THAT T HE PURCHASE SHOULD BE FOLLOWED BY DELIVERY OF SHARES A ND TRANSFER DEEDS, BOTH OF WHICH ARE EITHER NOT SUPPOR TED BY THE EVIDENCES PRODUCED BY THE ASSESSEE OR THE EVIDENCES PRODUCED ARE NOT SUPPORTING THE TRANSACTI ON. I.T.A. NO. 1219/HYD/2013 SRI SYED HAMEEDUDDIN 2 2. BRIEFLY THE FACTS OF THE CASE ARE THAT THE ASSES SEE, AN INDIVIDUAL, FILED HIS RETURN OF INCOME ON 07/10/200 3 ADMITTING TOTAL INCOME OF RS. 62,98,690/-. THE ASSESSING OFFI CER COMPLETED THE ASSESSMENT U/S 143(3) OF THE ACT AT R S. 64,54,300/- ON 07/11/2005. LATER, THE CIT-VI, HYDER ABAD SET ASIDE THE ASSESSMENT VIDE ORDER U/S 263 OF THE ACT DATED 27/03/2008. CONSEQUENT ON REVISION ORDER, THE ASSES SING OFFICER PASSED FRESH ASSESSMENT ORDER ON 30/12/2008 DETERMINING TOTAL INCOME AT RS. 1,52,10,880/- BY MA KING VARIOUS ADDITIONS INCLUDING THE ADDITION OF RS. 44, 00,000/- ON ACCOUNT OF UNEXPLAINED INVESTMENT IN SHARES, WHICH IS THE SUBJECT MATTER IN THE PRESENT APPEAL. 3. THE CIT(A) DISCUSSED THE ISSUE AT LENGTH FROM PARAS 6 TO 7.5 IN THE IMPUGNED ORDER AND BY CONSIDERING THE SUBMISSIONS OF THE ASSESSEE AS WELL AS CALLING THE REMAND REPORT FROM THE ASSESSING OFFICER, THE CIT(A) CONCL UDED AS UNDER: 7.6 THE PARTICULARS AS TABULATED IN PARA 7.1 ABOVE SHOW THAT THE DATE OF PURCHASE SHOULD BE TAKEN AS 19/07/2001 AS PER CBDTS CIRCULAR NO. 704 DATED 28/04/1995 (F.NO. 225/86/95-ITA-II, DATED 28/04/199 5 FROM CBDT, NEW DELHI). ACCORDINGLY, THE PERIOD OF HOLDING WOULD BE FOR MORE THAN 12 MONTHS AS CONTEND ED BY THE APPELLANT. AND THE INCOME ARISING ON TRANSFE R OF THESE SHARES WILL BE LONG TERM CAPITAL GAIN. CONSEQUENTLY, THERE IS NO QUESTION OF ANY SHORT TER M CAPITAL GAIN AND HENCE THE ADDITION OF RS. 19,98,76 4/- MADE ON THIS COUNT IS DELETED. THE INVESTMENT OF RS . 7 LAKH IN THE IMPUGNED 2 LAKH SHARES HAVING BEEN ACCEPTED AS MADE ON 21/06/2001 (AY 2002-03), THERE DOES NOT ARISE THE QUESTION OF UNEXPLAINED INVESTME NT IN AY 2003-04. THEREFORE, THE ADDITION OF RS. 44,00,00 0/- MADE TOWARDS UNEXPLAINED INVESTMENT IS DELETED. 4. AGGRIEVED BY THE ORDER OF THE CIT(A), THE REVENU E IS IN APPEAL BEFORE US. I.T.A. NO. 1219/HYD/2013 SRI SYED HAMEEDUDDIN 3 5. WE HAVE HEARD THE ARGUMENTS OF BOTH THE PARTIES AND PERUSED THE RECORD AS WELL AS GONE THROUGH THE ORDE RS OF THE AUTHORITIES. BEFORE US, THE LEARNED COUNSEL SUBMITT ED THAT ASSESSEE PURCHASED THE IMPUGNED SHARES OUT OF THE S ALE CONSIDERATION RECEIVED FROM SALE OF SHARES OF SBI, GLOBAL TELE AND DIGITAL EQUIPMENT AND THIS INCOME WAS OFFERED T O TAX IN EARLIER ASSESSMENT YEAR 2002-03. HOWEVER, IT WAS NO T CLEAR WHEN THE ASSESSEE PURCHASED THESE SHARES AND WHAT CONSIDERATION PAID. THE ASSESSEE AT FIRST STAGE MAD E A PLEA BEFORE THE LOWER AUTHORITIES THAT TWO LAKH SHARES O F TRANSACTION SECURITIES LTD. WERE PURCHASED FROM THE CONSIDERATION RECEIVED BY HIM FROM THE SALE OF SHAR ES OF THE ABOVE THREE FIRMS. IN OUR OPINION, ASSESSEE HAS TO PROVE PURCHASE OF FIRST BLOCK OF SHARES OF DIGITAL EQUIPM ENT AND THEREAFTER HAS TO PROVE THE SALE OF SHARES OF SBI A ND GLOBAL TELE FOR THE PURPOSE OF PAYMENT CONSIDERATION TOWAR DS PURCHASE OF TSL SHARES. IN VIEW OF THE ABOVE OBSER VATIONS, WE SET ASIDE THE ORDER OF THE CIT(A) AND RESTORE T HE ISSUE TO THE FILE OF THE ASSESSING OFFICER FOR FRESH CONSIDE RATION OF THE ISSUE AFTER EXAMINING THE DETAILS THAT WILL BE PUT- FORTH BY THE ASSESSEE BEFORE HIM IN SUPPORT OF HIS CLAIM. THE AS SESSEE IS DIRECTED TO SUBSTANTIATE HIS CLAIM BY WAY OF ADDUCI NG PROPER DOCUMENTARY EVIDENCE BEFORE THE ASSESSING OFFICER. 6. IN THE RESULT, APPEAL OF THE REVENUE IS TREATED AS ALLOWED FOR STATISTICAL PURPOSES. PRONOUNCED IN THE OPEN COURT ON 03/12/2013. (ASHA VIJAYARAGHAVAN) JUDICIAL MEMBER (CHANDRA POOJARI) ACCOUNTANT MEMBER HYDERABAD, DATED 03/12/2013. KV I.T.A. NO. 1219/HYD/2013 SRI SYED HAMEEDUDDIN 4 COPY FORWARDED TO: 1. ACIT, CIRCLE 9(1), ROOM NO. 127, 1B, FIRST FLOOR , IT TOWERS, AC GUARDS, MASAB TANK, HYDERABAD. 2. SRI SYED HAMEEDUDDIN, 18-8-534/12A/1, EDI BAZAAR , HYDERABAD. 3. CIT(A)-V, HYDERABAD 4 CIT-VI, HYDERABAD 5 THE DR, ITAT, HYDERABAD