ITO, Ward - 8(3), Kolkata, Kolkata V. M/s. Quiickpay Suppliers Pvt. Ltd., Kolkata

ITA 1231/KOL/2011

• Counselvise Citation: 123123514 RSA 2011
• Duration Of Justice: 4 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-02-2012
• Appeal Filed By: Department
• Bench Allotted: A
• Assessment Year: 2008-2009
• Appeal Filed On: 22-09-2011
• Court: TRIBUNAL
• Department Lawyers: S K ROY
• Assessee Lawyers: K K CHAPARIA
• Keywords: Speculation loss; Futures and options

Judgement Text

, , , IN THE INCOME TAX APPELLATE TRIBUNAL, BEN CH A, KOLKATA () BEFORE . .. . , ,, , , SHRI N.VIJAYAKUMARAN, JUDICIAL MEMBER. ! ! ! ! /AND . .. .'# '#'# '#. .. . , $% SHRI C.D.RAO, ACCOUNTANT MEMBER &' &' &' &' !( !( !( !( / ITA NO . 1231/KOL/2011 )* +,/ ASSESSMENT YEAR : 2008-09 (./ / APPELLANT ) I.T.O., WARD-8(3), KOLKATA. - - - VERSUS - . (12.// RESPONDENT ) M/S.QUICKPAY SUPPLIERS PVT.LTD., KOLKATA (PAN: AAACQ 0511 F) 3 ' 3 ' 3 ' 3 ' /C.O. NO.59/KOL/2011 !( !( !( !( / A/O ITA NO.1231/KOL/2011 )* +,/ ASSESSMENT YEAR : 2006-07 (./ / APPELLANT ) M/S.QUICKPAY SUPPLIERS PVT. LTD., KOLKATA (PAN: AAACQ 0511 F) - - - VERSUS - . (12.// RESPONDENT ) I.T.O., WARD-8(3), KOLKATA. ./ 4 5 $/ FOR THE DEPARTMENT: SHRI S.K.ROY 12./ 4 5 $/ FOR THE ASSESSEE : SHRI K.K.CHAPARIA 6 4 #% /DATE OF HEARING : 06.02.2012. 7+ 4 #% /DATE OF PRONOUNCEMENT : $8 / ORDER ( (( ( . .. .'# '#'# '#. .. . ) )) ), , , , $% PER SHRI C.D.RAO, AM THE ABOVE TWO APPEALS ONE FILED BY THE REVENUE AND THE CROSS OBJECTION FILED BY THE ASSESSEE ARE AGAINST ORDERS DATED 28.07.201 1 OF THE CIT(A)-VIII, KOLKATA PERTAINING TO A.YR. 2008-09. 2 2. THE ONLY ISSUE RAISED BY THE REVENUE IS RELATIN G TO ALLOWING OF REBATE U/S 88E OF THE ACT ON THE ENTIRE TAXABLE SECURITIES TRANSACTI ON. 3. THE BRIEF FACTS OF THIS ISSUE ARE THAT WHILE DO ING THE SCRUTINY ASSESSMENT THE ASSESSING OFFICER HAS DISALLOWED AN AMOUNT OF RS.14 ,42,794/- AS AGAINST RS.20,80,595/- BY OBSERVING AS UNDER :- IN THE COURSE OF THE ASSESSMENT PROCEEDINGS THE A R PRODUCED DETAILS OF STT PAID OF RS. 20,80595/- BY THE ASSESSEE. IN THIS RESPECT EVI DENCE OF PAYMENT OF SUCH TAX WAS ALSO PRODUCED IN THE PRESCRIBED FORM 10DB. THE A/R STATED THAT REBATE U/S 88E IN RESPECT OF SIT PAID SHOULD BE GIVEN ON THE FULL AMO UNT OF RS 20,80595/ - PAID IN THE PREVIOUS YEAR. HOWEVER I DO NOT FIND THE CLAIM OF R EBATE OF RS 2080595/- U/S 88E MADE BY THE ASSESSEE TO BE CORRECT BASED ON THE FOL LOWING FACTS: INCOME FROM TAXABLE SECURITIES TRANSACTIONS: 1) INCOME FROM DERIVATIVES (FUTURES AND OPTIONS) RS 62,65098 /- 2) INCOME FROM SHARE TRADING. RS (-)4,33,46042/ - 3) INCOME FROM SPECULATION RS. 1,1584239/- TOTAL: RS (-) 2,54,96703/- IT IS SEEN THAT THE NET RESULT OF THE ABOVE TRANSAC TIONS IS A LOSS OF RS 2,5496703/-. SECTION 88E RESTRICTS REBATE TO TAX ON INCOME ARISING FROM TAXABLE SECURITIES TRANSACTION INCLUDED THE TOTAL INCOME . THIS IS MADE AMPLY CLEAR BY SECTION 88E OF THE ACT WHICH READS AS FOLLOWS: (1) WHERE TOTAL INCOME OF THE ASSESSEE IN A PREVIOU S YEAR INCLUDES ANY INCOME CHARGEABLE UNDER THE HEAD PROFIT AND GAINS OF BUSI NESS OR PROFESSION ARISING FROM TAXABLE SECURITY TRANSACTIONS, HE SHALL BE ENTITLED TO A DEDUCTION. ,FRORN THE AMOUNT OF INCOME TAX ON SUCH INCOME FROM SUCH TRANSACTION , COMPUTED IN THE MANNER PRO UIDED IN SUB SECTION (2) OF AN AMOUNT EQUAL TO THE SECURI TY TRANSACTIONS TAX PAID BY HIM IN RESPECT OF THE TAXABLE SECURITY TRANSACTIONS ENTERE D INTO IN THE COURSE OF HIS BUSINESS DURING THAT PREVIOUS YEAR. IN THE CASE OF THE ASSESSEE, SINCE THE RESULT OF SU CH TAXABLE SECURITIES TRANSACTION OR GROSS INCOME WAS A LOSS .REBATE U/S 88E IS NOT ALLOWABLE ON SUCH LOSS. HOW EVER EVEN IN THIS CASE AS INCOME FROM DERIVATIVE TRADING IS I NCLUDED IN TOTAL INCOME , STT PAID IN RESPECT OF DERIVATIVE TRANSACTION INCOME OF RS 6 ,37801/-IS ALLOWABLE AS REBATE U/S 88E. THEREFORE ASSESSEES ADDITIONAL CLAIM OF RS 14 42794/- AS REBATE U/S 88E IS DISALLOWED AS SUCH REBATE IS ALLOW ONLY ON TAXABLE TOTAL INCOME, AND STT PAID IN RESPECT OF TRANSACTIONS TREATED AS SPECULATION LOSS NOT BEING PART OF TOTAL INCOME IS HEREBY DISALLOWED CONTRARY TO THE ASSESSEES CLAIM. 3.1. ON APPEAL AFTER TAKING INTO CONSIDERATION OF THE VARIOUS SUBMISSIONS OF ASSESSEE THE LD. CIT(A) HAS ALLOWED ASSESSEES APPEAL BY OBS ERVING AS UNDER :- I HAVEGONE THROUGH THE SUBMISSIONS OF THE ASSESSEE AND THE FINDINGS OF THE AO. I DO FIND MERIT IN THE SUBMISSION OF THE APPELLANT. I AG REE WITH THE A/R THAT REBATE U /S 88E 3 IS ALLOWED ON TAXABLE SECURITIES TRANSACTION COMPU TED IN THE MANNER PROVIDED IN SUB- SECTION (2) OF SECTION 88E. SECTION 88E DOES NOT MA KE ANY DISTINCTION BETWEEN SPECULATIVE OR NON-SPECULATIVE TAXABLE SECURITI ES TRANSACTIONS. LOOKING FROM OTHER ANGLE, REBATE U/S 88E FOR TAXABLE SECURITIES TRANS ACTIONS FOR A YEAR CANNOT BE CARRIED FORWARD FOR SET OFF IN FUTURE YEARS. HAD THE LEGISL ATURE INTENDED TO CAME FORWARD REBATE, THEN NECESSARY PROVISIONS WOULD HAVE BEEN I NSERTED SIMILAR TO PROVISIONS OF CARRIED FORWARD OF LOSS. HENCE, I DIRECT THE AO TO ALLOW REBATE ON ENTIRE TAXABLE SECURITIES TRANSACTION IN THE MANNER PROVIDED IN S UB-SECTION(2). THUS GROUND NO 2 IS ALLOWED IN THE FAVOUR OF THE ASSESSEE FOR STATISTIC AL PURPOSES. 3.2. AGGRIEVED BY THIS REVENUE IS IN APPEAL BEFORE US. 4. AT THE TIME OF HEARING THE LD. DR APPEARING ON BEHALF OF THE REVENUE HAS REITERATED THE SUBMISSIONS MADE BY ASSESSING OFFICE R AND SUBMITTED THE SAME MAY BE UPHELD. 5. ON THE OTHER HAND THE LD. COUNSEL APPEARING ON BEHALF OF ASSESSEE RELIED ON ORDERS OF THE LD. CIT(A) AND FURTHER FILED A COPY O F THE TRIBUNALS ORDER VIDE ITA NO.1255/KOL/2010 IN THE CASE OF DCIT,CIR.1, KOLKATA VS M/S. ASHIKA STOCK BROKING LTD. ORDER DATED 19.11.2010 WHEREIN THE TRIBUNAL HA S UPHELD THE ACTION OF THE LD. CIT(A). THEREFORE HE REQUESTED TO DELETE THE SAME. 6. AFTER HEARING THE RIVAL SUBMISSIONS AND ON CARE FUL PERUSAL OF MATERIALS AVAILABLE ON RECORD, WE ARE OF THE VIEW THAT THE LD . CIT(A) HAS PROPERLY OBSERVED THAT SECTION 88E OF THE ACT DOES NOT MAKE ANY DISTINCTIO N BETWEEN SPECULATIVE OR NON SPECULATIVE TAXABLE SECURITIES TRANSACTIONS. THEREF ORE WE FIND NO INFIRMITY IN THE ORDERS OF THE LD. CIT(A) TO BE INTERFERED WITH. 6.1. AS REGARDING THE CROSS OBJECTION RAISED BY THE ASSESSEE THE LD. COUNSEL APPEARING ON BEHALF OF ASSESSEE HAS NOT PRESSED THE SAME AT THE TIME OF HEARING. THEREFORE THE CROSS OBJECTION OF THE ASSESSEE IS DI SMISSED AS BEING NO PRESSED. 4 7. IN THE RESULT THE APPEAL OF THE REVENUE AS WELL AS CROSS OBJECTION OF ASSESSEE ARE DIMISSED. ORDER PRONOUNCED IN THE COURT ON 09.02.2012. SD/- SD/- . .. . , , , , ) ) ) ) N.VIJAYAKUMARAN, JUDICIAL MEMBER . .. .'# '#'# '#. .. . , ,, , $% $% $% $% , C.D.RAO, ACCOUNTANT MEMBER. ( (( (#% #% #% #%) )) ) DATE: 09.02.2012. $8 4 1)) 9$+:- COPY OF THE ORDER FORWARDED TO: 1. M/S.QUICKPAY SUPPLIERS PVT. LTD., 3, PRETORIA ST., CHANDRAKUNJ, 1 ST FL., KOLKATA-700071. 2 THE I.T.O., WARD-8(3), KOLKATA. 3. THE CIT, 4. THE CIT(A)-VIII, KOLKATA. 5. DR, KOLKATA BENCHES, KOLKATA 2 1)/ TRUE COPY, $8/ BY ORDER, DEPUTY /ASST. REGISTRAR , ITAT, KOLKATA BENCHES R.G.(.P.S.)