PEGASUS STOCKS & SHARES P. LTD, MUMBAI V. ASST CIT 4(2), MUMBAI

ITA 122/MUM/2012

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 87885 (ITAT-MUMBAI)
• Duration Of Justice: 3 year(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-01-2015
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: C
• Next Hearing Date: 05-11-2014
• Assessment Year: 2008-2009
• Appeal Filed On: 06-01-2012
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Keywords: Proportionate interest
• Section: 14A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH, MUM BAI , , BEFORE SHRI SANJAY ARORA, AM AND SHRI AMIT SHUKLA, JM ./ I.T.A. NO. 122/MUM/2012 ( / ASSESSMENT YEAR: 2008-09) PEGASUS STOCKS & SHARES PVT. LTD. 320, YASHWANT SMRUTHI, 12 TH ROAD, KHAR, MUMBAI-400 052 / VS. ASST. CIT-4(2), AAYAKAR BHAVAN, M. K. ROAD, MUMBAI ! ./' ./PAN/GIR NO. AADCP 3708 N ( !# /APPELLANT ) : ( $%!# / RESPONDENT ) !# & ' / APPELLANT BY : SHRI VIJAY MEHTA $%!# & ' / RESPONDENT BY : SHRI AKHILENDRA P. YADAV () * & + / DATE OF HEARING : 05.11.2014 ,-. & + / DATE OF PRONOUNCEMENT : 23.01.2015 / O R D E R PER SANJAY ARORA, A. M.: THIS IS AN APPEAL BY THE ASSESSEE DIRECTED AGAINST THE ORDER BY THE COMMISSIONER OF INCOME TAX (APPEALS)-8, MUMBAI (CIT(A) FOR SHO RT) DATED 03.11.2011, DISMISSING THE ASSESSEES APPEAL CONTESTING ITS ASSESSMENT U/S .143(3) OF THE INCOME TAX ACT, 1961 (THE ACT HEREINAFTER) FOR THE ASSESSMENT YEAR (A. Y.) 2008-09 VIDE ORDER DATED 15.12.2010. 2. THE ONLY ISSUE ARISING IN THE INSTANT APPEAL IS THE QUANTUM OR THE EXTENT OF DISALLOWANCE U/S.14A(1) THAT COULD BE VALIDLY MADE IN LAW IN VIEW OF THE ASSESSEES 2 ITA NO. 122/MUM/2012 (A.Y. 2008-09) PEGASUS STOCKS & SHARES PVT. LTD. VS. ASST. CIT INVESTMENT IN SHARES YIELDING TAX-EXEMPT DIVIDEND I NCOME, WHICH FOR THE CURRENT YEAR IS AT RS.29.77 LACS. THE ASSESSEE HAVING NOT MADE ANY DISALLOWANCE U/S.14A(1), THE ASSESSING OFFICER (A.O.), APPLYING RULE 8D, WORKED OUT THE SAME AT RS.99,72,855/-, COMPRISING INTEREST AND INDIRECT ADMINISTRATIVE EXP ENDITURE AT RS.81,16,222/- AND RS.18,56,633/- RESPECTIVELY. THE ASSESSEE HAVING NO T MAINTAINED ANY SEPARATE BOOKS OF ACCOUNT OR RECORD IN RESPECT OF INVESTMENT ACTIVITY IN SHARES, LIABLE TO YIELD INCOME NOT FORMING PART OF THE TOTAL INCOME, AN ESTIMATE QUA INDIRECT EXPENSES, I.E., AS ATTRIBUTABLE TO SUCH INCOME, IN THE VIEW OF THE LD. CIT(A), STOOD V ALIDLY MADE BY TAKING RECOURSE TO RULE 8D, MANDATORY FOR THE CURRENT YEAR, BY THE A.O. THE ASSESSEES CONTENTION THAT IT HAD NOT UTILIZED ANY BORROWED FUNDS FOR INVESTMENT IN SHARE S WAS FOUND BY HIM AS NOT SUBSTANTIATED BY THE ASSESSEE, WITH ITS BALANCE-SH EET SUGGESTING OTHERWISE. THE DISALLOWANCE BEING CONFIRMED THUS, THE ASSESSEE IS IN FURTHER APPEAL. 3. BEFORE US, THE LD. AUTHORIZED REPRESENTATIVE (A R) WOULD AT THE OUTSET SUBMIT THAT THE ASSESSEES CASE IS COVERED BY THE DECISION BY T HE TRIBUNAL IN THE CASE OF DY. CIT VS. DAMANI ESTATES & FINANCE (P.) LTD. (IN ITA NO. 3029/MUM/2012 DATED 17.07.2013, SINCE REPORTED AT [2013] 25 ITR 683 (MUM)(TRIB)), P LACING A COPY OF THE SAID ORDER ON RECORD. THE TRIBUNAL IN THAT CASE, HE WOULD CONTINU E, WHILE CONFIRMING THAT A DISALLOWANCE U/S.14A(1) WOULD OBTAIN EVEN WHERE THE SHARES, ON W HICH THE DIVIDEND INCOME IS EARNED, FORMED PART OF THE ASSESSEES STOCK-IN-TRADE, HELD THAT THE SAID SHARES, ALSO GIVING RISE TO SHARE TRADING INCOME, WHICH IS TAXABLE, THE ENTIRE INTEREST ATTRIBUTABLE TO THE INVESTMENT IN SHARES COULD NOT BE DISALLOWED BY MECHANICALLY APPL YING R.8D(2)(II) (OR R.8D(2)(I) FOR THAT MATTER). ACCORDINGLY, IT OPINED FOR A DISALLOW ANCE AT 20% OF THE AMOUNT REFERABLE TO SUCH PROPORTIONATE INTEREST, CONSIDERING THAT THE P REDOMINANT OBJECT OF THE SHARE HOLDING WAS TO EARN BUSINESS PROFIT THROUGH SHARE TRADING A CTIVITY, TAKING US THROUGH THE RELEVANT PART OF THE SAID ORDER (PARA 5.6, AT PGS. 12, 13). THE TRIBUNAL WAS, IN SO ADVOCATING, HE WOULD FURTHER CONTINUE, GUIDED BY THE FACT THAT T HE TURNOVER OF THE SHARE TRADING ACTIVITY WOULD EASILY BE FOUR TO FOUR TIMES THE AVERAGE SHAR E HOLDING. THAT IS, THE TRIBUNAL WHILE OPINING A RESTRICTION OF THE DISALLOWANCE AT 20% OF THE RELEVANT INTEREST, DID NOT LAY DOWN 3 ITA NO. 122/MUM/2012 (A.Y. 2008-09) PEGASUS STOCKS & SHARES PVT. LTD. VS. ASST. CIT ANY HARD AND FAST RULE, EACH FACT SITUATION, EVEN A S STATED BY IT, BEING DIFFERENT. THE ASSESSEE IN THE PRESENT CASE IS IN THE BUSINESS OF TRADING IN SHARES AND SECURITIES, SO THAT THE SAID DECISION WOULD SQUARELY APPLY TO IT. FURTH ER, ADDUCING A COPY OF THE BALANCE- SHEET (AS ON 31.03.2008), HE POINTED OUT THAT THE S ALES IN THE INSTANT CASE ARE AT RS.2695.84 CRORES, ABOUT 72 TIMES THE AVERAGE INVES TMENT OF RS.3713.27 LACS (ALSO REFER PARA 4.3 OF THE ASSESSMENT ORDER). THERE WAS AS SUC H A STRONG CASE, IN THE FACTS OF THE CASE, FOR SCALING DOWN THE RATIO OF 20% (1/5), AS I NDEED WAS FOUND BY THE TRIBUNAL IN THE CASE OF RAMKUMAR VENUGOPAL INVESTMENTS PVT. LTD. VS. ASST. CIT (IN ITA NO. 6324/MUM(D)/2012 DATED 27.08.2014), FOLLOWING D. H. SECURITIES (P) LTD. VS. DCIT [2014] 41 TAXMANN.COM 352 (MUM) (TM) (WHICH HAS CON FIRMED THE VIEW AS TAKEN BY THE TRIBUNAL IN DAMANI ESTATES & FINANCE (P.) LTD. (SUPRA)), AND RESTRICTED THE DISALLOWANCE ON ACCOUNT OF INTEREST TO 5% OF THE PROPORTIONATE I NTEREST, ADVERTING TO PARA 5 OF THE SAID ORDER, COPY OF WHICH WAS FURNISHED BY HIM. SIMILARL Y, THERE WAS A STRONG CASE FOR, LIKEWISE, SCALING DOWN THE INDIRECT EXPENDITURE, AS COMPUTED UNDER R.8D(2)(III), IN VIEW OF THE FACT THAT BULK OF THE INDIRECT EXPENDITURE, CLAIMED AT RS.446.09 LACS, CONSISTS OF SECURITIES TRANSACTION TAX (RS.342.93 LACS) AND LEG AL AND PROFESSIONAL FEES (RS.88.97 LACS), EVEN AS WAS DONE BY THE TRIBUNAL IN THE SAID CASE, RESTRICTING IT TO 10% OF THE AMOUNT REFERABLE TO R.8D(2)(III). 4. WE HAVE HEARD THE PARTIES, AND PERUSED THE MATER IAL ON RECORD. 4.1 OUR FIRST OBSERVATION IN THE MATTER IS THAT THE DECISION BY THE TRIBUNAL IN DAMANI ESTATES & FINANCE (P.) LTD. (SUPRA) SHALL APPLY IN THE FACTS AND CIRCUMSTANCES OF THE CASE; THE VIEW CANVASSED THEREIN, I.E., THE APPLICABILITY OF SECTION 14A WHERE THE SHARES ARE HELD AS STOCK-IN-TRADE, HAVING BEEN SINCE UPHELD BY THE LARGER BENCH OF THE TRIBUNAL IN D.H. SECURITIES (P) LTD. (SUPRA). IN FACT, THERE IS NO DISPUTE WITH REGARD T O THIS. THERE IS, AS SUCH, A CLEAR CASE IN FAVOUR OF THE ASSESSEE FOR SC ALING DOWN THE DISALLOWANCE QUA INTEREST ATTRIBUTABLE TO THE AVERAGE INVESTMENT IN SHARES, R EPRESENTING THE STOCK-IN-TRADE OF THE ASSESSEES BUSINESS. WITH REGARD TO THE ASSESSEES CONTENTION FOR RESTRICTING THE DISALLOWANCE TO BELOW 20% OF SUCH INTEREST, WE CONS IDER THE ASSESSEES PLEA AS LARGELY 4 ITA NO. 122/MUM/2012 (A.Y. 2008-09) PEGASUS STOCKS & SHARES PVT. LTD. VS. ASST. CIT MISCONCEIVED. THE TURNOVER RATIO PER SE HAS NO BEARING ON THE INTEREST EXPENDITURE, A PART WHEREOF, I.E., AS RELATABLE TO THE INVESTMENT IN SH ARES, IS SUBJECT TO DISALLOWANCE U/S.14A(1), WHICH (EXPENDITURE) IS WHOLLY AND DIREC TLY RELATABLE TO SUCH INVESTMENT ONLY, SO THAT THE HIGHER INVESTMENT WOULD LEAD TO OR GI VE RISE TO A HIGHER ALLOCATION OF INTEREST EXPENDITURE. A HIGHER TURNOVER AND, THUS, TURNOVE R RATIO, ITSELF IMPLIES A LOWER (AVERAGE) INVESTMENT IN SHARES (STOCK-IN-TRADE), WI TH REFERENCE TO WHICH ONLY, I.E., AS RELATABLE THERETO, THE INTEREST EXPENDITURE STANDS TO BE DISALLOWED. THAT IS, FUNDS ARE INVESTED OR UTILIZED ONLY TO SUCH LOWER EXTENT IN STOCK-IN-TRADE, AND THE INTEREST EXPENDITURE IS INCURRED ONLY QUA THE FUNDS SO INVESTED. THE TRIBUNAL IN FACT MADE IT ABUNDANTLY CLEAR THAT ANY INCOME AND BY NECESSARY IMPLICATION, ANY INCOME ATTRIBUTE, AS SALES, OR HIGHER SALES CANNOT BE THE BASIS FOR DETERMINING THE INDIRECT EXPENDITURE ATTRIBUTABLE TO A PARTICULAR ACTIVITY. ALSO REFER P ARA 5.5 OF THE ORDER. THE ARGUMENT, AS CANVASSED, THUS, RATHER THAN BOLSTERING ITS CASE FO R FURTHER SCALING DOWN, ONLY DISPROVES IT. 4.2 THE TRIBUNAL, IN THE CITED CASE, CANDIDLY ADMIT S TO ITS PRESCRIPTION (OF 1/5 TH ) AS BEING OPEN TO A CHARGE OF ADHOCISM, FURTHER CLARIFY ING OF HAVING BEEN GUIDED PRINCIPALLY, I.E., IN SO SUGGESTING, BY THE FACT THAT THE PREDOM INANT OBJECT OF ACQUIRING AND HOLDING SHARES IRRESPECTIVE OF THE EXTENT OF INCOME, WAS FOR SHARE TRADING, INCOME FROM WHICH ACTIVITY IS LIABLE TO TAX. THE REFERENCE TO THE TUR NOVER RATIO, WHICH IT SAYS WOULD EASILY BE AT 4 TO 5, STANDS MADE BY IT ONLY TOWARD ASSIGNING A WEIGHT TO THIS PREDOMINANT INTENT FOR ACQUIRING SHARES, AND NO OTHER PURPOSE, ITSELF STAT ING THAT IT CANNOT BE SAID TO BE SCIENTIFIC IN THE SENSE THAT IT IS NOT AMENABLE TO MEASUREMENT . THE SAID REFERENCE HAS BEEN CLEARLY MISCONSTRUED IN PLEADING FOR LOWERING THE RATIO (TH AN 1/5) ON THE BASIS OF A HIGH TURNOVER RATIO. THE ASSESSEE IN THE PRESENT CASE HAS, IN FAC T, RATHER THAN EARNING INCOME, SUFFERED A LOSS, DEFEATING THE ASSESSEES ARGUMENT. IN FACT, W E OBSERVE THE ENTIRE BORROWING IN THE PRESENT CASE TO BE TOWARD FUNDING THE ASSESSEES CU RRENT ASSETS. WE ARE, THEREFORE, NOT MOVED IN ANY MANNER TO DISTURB THE SAID RATIO FROM 1/5, WHICH SHALL APPLY. WE DECIDE ACCORDINGLY. 5 ITA NO. 122/MUM/2012 (A.Y. 2008-09) PEGASUS STOCKS & SHARES PVT. LTD. VS. ASST. CIT 4.3 COMING, NEXT, TO THE DISALLOWANCE UNDER R.8D(2) (III), FOR WHICH A SIMILAR PLEA STOOD RAISED. THE SAID QUESTION STANDS ALSO COMPREH ENSIVELY ANSWERED BY THE TRIBUNAL IN DAMANI ESTATES & FINANCE (P.) LTD . (SUPRA) (VIDE THE LATTER PART OF PARA 5.6, PGS. 1 4-15 OF THE ORDER), TO WHICH PARA REFERENCE, ALBEIT SELECTI VELY, WAS MADE BY THE LD. AR. WE MAY REPRODUCE THE SAME AS UNDER: CONTINUING FURTHER, THE PART OF THE RULE PRESCRIBI NG THE RATIO IN RESPECT OF INDIRECT EXPENDITURE (R. 8D(2)(III)) CANNOT BE ALTE RED ON ACCOUNT OF HARDSHIP (REFERENCE IS DRAWN TO THE SECTION OF THE JUDGMENT IN GODREJ & BOYCE (SUPRA) ON THE CONSTITUTIONALITY OF SUB-SECTIONS (2 ) & (3) OF SECTION 14A AND RULE 8D/PGS. 113 123). EVEN SO, THE RULE PRESCRIB ES THE SAME AS THE RATIO OF INDIRECT EXPENDITURE REQUIRED TO SUPPORT AN INVE STMENT. WE SAY SO AS THE EXPENDITURE PRESCRIBED FOR DISALLOWANCE IS BASED ON LY ON ONE VARIABLE, I.E., THE VALUE OF THE INVESTMENT (ON AN AVERAGE). INVEST MENT ACTIVITY, IT MAY BE APPRECIATED, IS MUCH STABLER IN CHARACTER IN COMPAR ISON TO THE TRADING ACTIVITY, WHICH INVOLVES CONTINUOUS CHURNING OF FUN DS AND, THUS, ACTIVITY, REQUIRING A MUCH HIGHER LEVEL OF ORGANIZATIONAL SUP PORT/EXPENDITURE. INVESTMENTS, ON THE OTHER HAND, ARE LONG TERM AND S TRATEGIC, REQUIRING ONLY PERIODIC REVIEW OF PERFORMANCE WITH REFERENCE TO TH E INVESTMENT OBJECTIVE/S, BESIDES ON ACCOUNT OF ENVIRONMENTAL CH ANGES, IF ANY. WHY, THE PRESCRIBED ALLOCATION RATIO OF 0.5% OF THE INVESTME NT VALUE QUA INDIRECT EXPENDITURE IS VERY NOMINAL, RECOMMENDING ITSELF TO EASY ACCEPTANCE, IS ITSELF BASED, EVEN AS OBSERVED BY THE HONBLE COURT (AT 116 OF THE REPORT), ON THE 2% TO 2.5% (OF THE INVESTMENT) (FEE) USUALLY CH ARGED BY THE PORTFOLIO MANAGEMENT SERVICE (PMS) PROVIDERS, OF WHICH AROUND 1% (OF THE PORTFOLIO VALUE) WOULD BE THEIR PROFIT. THE NOMINAL RATE OF 0.5% ALSO ESCHEWS THE CHARGE OF IT BEING HARSH, WHILE BEING A T THE SAME TIME CLARIFICATORY OF ITS PURPOSE; THE INVESTMENT ACTIVI TY BEING ESSENTIALLY SPORADIC AND EPISODIC. IN FACT, THE ASSESSEE ITSELF EXPLAINS OF NO CHANGE IN ITS INVESTMENT PORTFOLIO DURING THE YEAR EXCEPT FOR ONE SWITCH FROM A COMPANY SHARE TO UNITS OF A MUTUAL FUND (HDFC LIQUI D FUND). OUR DISCUSSION IS, HOWEVER, ONLY TOWARD THE NOMINALITY AND PURPORT OF THE CHARGE, AND DOES NOT IN ANY MANNER IMPLY OF IT BEIN G CONFINED ONLY TO SHARES HELD AS INVESTMENT. THIS IS AS EVEN THOUGH P URCHASED WITH A SHORT TERM PERSPECTIVE, THE SHARES ARE PURCHASED ONLY WIT H PROFIT OBJECTIVE, I.E., AS REPRESENTING A GOOD INVESTMENT OPPORTUNITY, SO THAT IT IS PERCEIVED AS UNDER- PRICED, AND ITS MARKET PRICE WOULD APPRECIATE IN TI ME, YIELDING GOOD RETURN AND, RATHER, IN A SHORTER PERIOD OF TIME. THAT IS, THE INVESTMENT COMPONENT OR ELEMENT IS INBUILT IN ANY PURCHASE AND TOWARD WH ICH THE ALLOCATION OF INDIRECT EXPENDITURE IS PRESCRIBED PER R. 8D(2)(III ). THE FACT THAT TRADING SHARES ALSO YIELD DIVIDEND INCOME, WHICH IS NOT TAX ABLE, I.E., BESIDES SHARE 6 ITA NO. 122/MUM/2012 (A.Y. 2008-09) PEGASUS STOCKS & SHARES PVT. LTD. VS. ASST. CIT TRADING INCOME, IS ITSELF RELEVANT AND SUFFICIENT F OR ATTRACTING THE PROVISION OF S.14A(1). IN FACT, AN ARGUMENT TO THIS EFFECT, I .E., R. 8D(2)(III) AS BEING NOT APPLICABLE TO SHARES HELD AS STOCK-IN-TRADE, WAS SP ECIFICALLY ASSUMED IN THE CASE OF DAGA CAPITAL (SUPRA). THE TRIBUNAL REJECTED THE ARGUMENT, MADE WITH REFERENCE TO THE LANGUAGE OF R.8D, CLARIFYING THAT THE WORDS USED ARE VALUE OF INVESTMENT AND NOT HELD AS INVESTMENT. WE MAY REPRODUCE THE RELEVANT PART OF THE ORDER FOR THE SAKE OF BETTER C LARITY: (PG. 233 OF THE REPORT IN ITD) 23.9 THE LEARNED COUNSEL FOR THE ASSESSEE .. WE ARE NOT IMPRESSED WITH THIS SUBMISSION RAISED ON BEHALF OF THE ASSESSEE FOR THE OUT-AND-OUT REASON THAT THE RE FERENCE IN THIS RULE IS TO THE VALUE OF INVESTMENT AND NOT THE AS SETS HELD AS INVESTMENT. A PERSON MAY MAKE INVESTMENT IN SHARES AND THE SHARES SO PURCHASED MAY BE HELD EITHER AS STOCK-IN -TRADE OR INVESTMENT. THE WORD INVESTMENT IN THIS RULE RE FERS TO THE MAKING OF PURCHASE OF SHARES AND NOT HOLDING IT AS INVESTMENT. WE DECIDE ACCORDINGLY. A PLEA FOR ADOPTING THE SAID RATIO (I.E., 1/5) WAS SIMILARLY, AFTER EXPLAINING THE REASONS FOR THE SAME, DISCOUNTENANCED BY THE TRIBUN AL IN THE CASE OF HSBC INVEST DIRECT (INDIA) LTD. (IN ITA NOS. 3485/MUM/2012 AND 3944/MUM/2012 DATED 17.10.2014) AND HATHWAY INVESTMENT PVT. LTD. (IN ITA NOS. 262/MUM/2012 AND 8662/MUM/2011 ORDER DATED 17.10.2014). IT NEEDS TO BE EMPHASIZED THAT T HE PRESCRIPTION UNDER R.8D(2)(III) IS NOT BASED ON THE VOLUME OR QUANTUM OF EXPENDITURE I NCURRED BY THE ASSESSEE, BUT, AS TRIBUNAL CLARIFIES, ONLY ON ONE VARIABLE, I.E., INV ESTMENT IN THE RELEVANT ASSETS (ON AN AVERAGE). AS SUCH, RAISING A CLAIM FOR A LOWER DISA LLOWANCE, I.E., THAN THAT AS STATUTORILY PRESCRIBED PER R.8D(2)(III), A CONSTITUTIONALLY VAL ID PROVISION, WOULD NOT OBTAIN. THE ONLY EXCEPTION, WHICH WOULD IN FACT BE IN TERMS OF R. 8D ITSELF, WOULD BE WHERE THE EXPENDITURE INCURRED IS BELOW THAT ARRIVED AT PER T HE PRESCRIBED FORMULA, SO THAT FOLLOWING THE SAME WOULD LEAD TO AN ABSURDITY, AS OBSERVED BY THE TRIBUNAL IN THE CASE OF DISALLOWANCE OF TOTAL INTEREST ATTRIBUTABLE TO SHAR ES HELD AS STOCK-IN-TRADE. IN THE FACTS OF THE PRESENT CASE, EXCLUDING THE SECURITY TRANSACTIO N TAX (STT), WOULD YET LEAVE INDIRECT EXPENDITURE AT RS.131.6 LACS, AS AGAINST THE DISALL OWANCE OF RS.18.57 LACS. THERE IS, IN OUR VIEW, NO SCOPE FOR EXCLUDING THE LEGAL AND PROFESSI ONAL EXPENSES, DETAILS OF WHICH ARE 7 ITA NO. 122/MUM/2012 (A.Y. 2008-09) PEGASUS STOCKS & SHARES PVT. LTD. VS. ASST. CIT ABSENT, INCURRED AS IT IS IN THE COURSE OF REGULAR BUSINESS, WHICH GIVES RISE TO BOTH TAXABLE INCOME AS WELL AS THE TAX FREE DIVIDEND INCOME. IN VIEW OF THE FOREGOING, A RATIO (1/5 OR LOWER), I.E., AS IN THE CASE OF INTEREST EXPENDITUR E FOR INDIRECT EXPENDITURE, THUS, IS NOT FEASIBLE FOR BEING PRESCRIBED OR LAID DOWN ON FACTS OR IN LAW. 4.4 BEFORE PARTING WITH OUR ORDER, WE MAY ALSO CLAR IFY THAT IT MAY APPEAR THAT WE HAVE NOT ADOPTED THE DECISION BY THE TRIBUNAL IN THE CAS E OF RAMKUMAR VENUGOPAL INVESTMENTS PVT. LTD. (SUPRA). HOWEVER, THE SAME IS FAR FROM TRUTH. THE M ATTER IS FIRSTLY PURELY FACTUAL. SECONDLY, WE HAVE, AS SOUGHT TO BE CLARIFIED, ONLY FOLLOWED AND EXPLAINED THE DECISION BY THE LARGER BENCHES OF THE TRIBUNAL, AS IN THE CASE OF ITO VS. DAGA CAPITAL MANAGEMENT PVT. LTD. [2009] 312 ITR (AT) 1 (MUM.) (SB); CHEMINVEST LTD. (SUPRA); D.H. SECURITIES (P) LTD. (SUPRA), AND WITH WHICH THE DECISION BY US (BEING P ARTY THERETO) IN DAMANI ESTATES & FINANCE (P.) LTD. (SUPRA) IS IN CONSONANCE WITH. THE HONBLE JURISDIC TIONAL HIGH COURT IN GODREJ & BOYCE MFG. CO. LTD. V. DY. CIT [2010] 328 ITR 81 (BOM) HAS ABUNDANTLY CLARIFIED THAT SECTION 14A REPRESENTS TH E FIRST SERIOUS ATTEMPT BY THE LEGISLATURE IN CODIFYING THE LAW IN THE MATTER, WHICH IS A COMP LETE CODE IN ITSELF AND, FURTHER, WIDENS THE THEORY OF APPORTIONMENT. AT THIS STAGE, REFEREN CE MAY ALSO BE MADE TO PARAS 4.1 AND 4.2 OF THIS ORDER. 5. NO ARGUMENTS QUA GROUND # 2 WERE RAISED BEFORE US. THE SAME IS ACCOR DINGLY DISMISSED AS NOT PRESSED. 6. IN THE RESULT, THE ASSESSEES APPEAL IS PARTLY A LLOWED. /. 0 (1 2/ & ) 3 & 45 ORDER PRONOUNCED IN THE OPEN COURT ON JANUARY 23, 2 015 SD/- SD/- (AMIT SHUKLA) (SANJAY ARORA) / JUDICIAL MEMBER / ACCOUNTANT MEMBER 6* MUMBAI; 7( DATED : 23.01.2015 ).(../ ROSHANI , SR. PS 8 ITA NO. 122/MUM/2012 (A.Y. 2008-09) PEGASUS STOCKS & SHARES PVT. LTD. VS. ASST. CIT !' # $%&' (!'% / COPY OF THE ORDER FORWARDED TO : 1. !# / THE APPELLANT 2. $%!# / THE RESPONDENT 3. ( ) / THE CIT(A) 4. / CIT - CONCERNED 5. :); < $(=1 , + =1. , 6* / DR, ITAT, MUMBAI 6. < ?2 @ * / GUARD FILE !' / BY ORDER, )/* + (DY./ASSTT. REGISTRAR) , 6* / ITAT, MUMBAI