ITO, Ward - 6(2), Kolkata, Kolkata V. Jubilee Investments & Industries Ltd., Kolkata

ITA 1470/KOL/2010

• Counselvise Citation: [2021] 109 COUNSELVISE.COM (IT) 9238 (ITAT-KOLKATA)
• Duration Of Justice: 10 year(s) 5 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-01-2021
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 02-06-2011
• Assessment Year: 2005-2006
• Appeal Filed On: 19-07-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: NIDHI SRIVASTAVA
• Keywords: Tax effect

Judgement Text

ITA NO.-1470/K/2010. JUBILEE INVESTMENTS & INDUSTRIES LTD. PAGE 1 OF 5 IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH: B: NEW DELHI) (THROUGH VIDEO CONFERENCING) BEFORE SHRI H.S. SIDHU, JUDICIAL MEMBER AND SHRI ANADEE NATH MISSHRA, ACCOUNTANT MEMBER ITA NO:- 1470/KOL/2010 ( ASSESSMENT YEAR: 2005-06) INCOME TAX OFFICER, WARD-6(2), KOLKATA. VS. JUBILEE INVESTMENTS & INDUSTRIES LTD. APPELLANT RESPONDENT PAN NO: AAACR5115J REVENUE BY : MS. NIDHI SRIVASTAVA, CIT(DR) ASSESSEE BY : SHRI KRISH DESAI, CA PER ANADEE NATH MISSHRA, AM (A) THIS APPEAL BY REVENUE IS FILED AGAINST THE ORDER OF LEARNED COMMISSIONER OF INCOME TAX (APPEALS)-VII, NEW DELHI, [LD. CIT(A), FOR SHORT], DATED 26.04.2010 FOR ASSESSMENT YEAR 2005-06. GROUNDS TAKEN IN THIS APP EAL OF REVENUE ARE AS UNDER: 1.THE LD. CIT(A)-VII, NEW DELHI, HAD ERRED IN LAW AS WELL AS ON FACTS, IN DELETING THE ADDITION OF RS.25,00,000/- MADE U/S.40(A)(IA) WITHO UT CONSIDERING THE NATURE OF BUSINESS OF THE ASSESSEE COMPANY VIS-A-VIS SERVICES RENDERED BY THE GROUP OF COMPANIES. 2. THE LD. CIT(A)-VII, NEW DELHI, HAD ERRED IN LAW AS WELL AS ON FACTS, IN DIRECTING THE ASSESSING OFFICER TO RECALCULATE THE DISALLOWANCES OF INTEREST EXPENSES OF ITA NO.-1470/K/2010. JUBILEE INVESTMENTS & INDUSTRIES LTD. PAGE 2 OF 5 RS.2,24,62,414/- U/S.36(I)(III), AS INTEREST ATTRIB UTABLE TO INTEREST-FREE LOANS ADVANCED TO GROUP COMPANIES, WITHOUT CONSIDERING THE RECORDS AV AILABLE AND FAILURE ON THE PART OF THE ASSESSEE COMPANY TO FILE THE REQUISITIONS CALLE D FOR BY THE AO AND ACCEPTING THE EXPLANATION OF THE ASSESSEE, WITHOUT ASKING FOR A R EMAND REPORT AS PER PROVISIONS OF RULE 46A OF THE I. T. RULES 3. THE LD. CTT(A)-VII, NEW DELHI, HAD ERRED IN LAW AS WELL AS ON FACTS, IN DIRECTING THE ASSESSING OFFICER TO ALLOW LOSS - OF RS.3,54,66,463/- AS LONG TERM CAPITAL LOSS FOR SALE & PURCHASE AND SALE OF SHARES & SECURITIES OF ZENSAR TECHNOLOGIES LTD., WITHOUT CONSIDERING THE FAILURE ON THE PART OF THE ASSESSEE COMPANY DURING THE COURSE OF ASSESSMENT PROCEEDINGS AND RESTRICTION OF SEBI RULE IN RESPECT OF OFF-MARKET TRADING. 4. THE LD. CIT(A)-VII NEW DELHI, HAD ERRED IN LAW A S WELL AS ON FACTS, IN DIRECTING THE ASSESSING OFFICER TO ACCEPT LONG TERM CAPITAL GAIN OF RS.2,33,34,157/- AND NET SHORT TERM CAPITAL LOSS OF RS.1,62,19,020/- IN RESPECT OF PURC HASE AND SALE OF SHARES OF KEC INTERNATIONAL, ACCEPTING THE FRESH PLEA OF THE ASSE SSEE COMPANY WITHOUT REMANDING THE MATTER TO AO AND VIOLATING RULE 46A OF THE I. T. RU LES. 5. THE LD. CIT(A)-VII, NEW DELHI, HAD ERRED IN LAW AS WELL AS ON FACTS, IN DIRECTING THE ASSESSING OFFICER TO ALLOW LONG TERM CAPITAL LOSS O F RS.74.40 LAKHS IN RESPECT OF SHARES OF RPG LIFE SCIENCE LTD., WHICH WERE HELD AS STOCK-IN- TRADE AND SOLD @ RS.41/-; WHEREAS THE SAID SHARES HELD AS INVESTMENT AND SOLD @ RS,.5 6.75, WITHOUT CONSIDERING THE MODUS OPERANDI OF THE ASSESSEE COMPANY TO REDUCE TH E TAX EFFECT. 6. THE LD. CIT(A)-VII, NEW DELHI, HAD ERRED IN LAW AS WELL AS ON FACTS, IN DIRECTING THE ASSESSING OFFICER TO ALLOW CAPITAL LOSS OF RS.33.11 CRORES IN RESPECT OF SALE OF UNQUOTED SHARES OF HILLTOP HOLDINGS, WHICH WERE HELD AS OPEN ING STOCK, PREFERRED TO SALE THE SAME OUT OF INVESTMENT PORTFOLIO THEREBY RESULTING UNWAR RANTED LONG TERM CAPITAL LOSS OF RS.33.11 CRORES, WITHOUT CONSIDERING THE FAILURE ON THE PART OF THE ASSESSEE COMPANY TO SUBSTANTIATE THE SALE VALUE OF UNQUOTED SHARE, TO W HOM IT WAS SOLD AND AS TO WHY SHARES IN STOCK WERE REMAINED UNSOLD AS WELL AS SCH EME OF THE ASSESSEE COMPANY TO AVOID TAX EFFECT. 7. THE LD. CIT(A)-VII, NEW DELHI, HAD ERRED IN LAW AS WELL AS ON FACTS, IN DIRECTING THE ASSESSING OFFICER TO ALLOW THE CAPITAL GAIN/LOSS AS CLAIMED BY THE ASSESSEE COMPANY ITA NO.-1470/K/2010. JUBILEE INVESTMENTS & INDUSTRIES LTD. PAGE 3 OF 5 WITHOUT CONSIDERING THE EFFORT AND INTENTION OF THE ASSESSEE COMPANY TO MINIMIZE THE TAX EFFECT. 8. THAT THE APPELLANT CRAVES FOR LEAVE TO ADD, DELE TE OR MODIFY ANY OF THE GROUNDS OF APPEAL BEFORE OR AT THE TIME OF HEARING. (B) AT THE TIME OF HEARING, AT THE OUTSET, THE LD. AUT HORIZED REPRESENTATIVE (LD. AR, FOR SHORT) FOR THE ASSESSEE INFORMED US THAT THE AS SESSEE FILED A DECLARATION UNDER THE VIVAD SE VISHWAS SCHEME, 2020 (VSVS, FOR SHORT) ELECTRONICALLY IN FORM 1, ON NOVEMBER 21,2020 VIDE ACKNOWLEDGEMENT NO. 736288081 211120 FOR THE SETTLEMENT OF SUBJECT MATTER OF THE DISPUTES IN THIS APPEAL. HE DREW OUR ATTENTION TO LETTER DATED JANUARY 04, 2021 FILED FROM ASSESSEES SIDE IN INCO ME TAX APPELLATE TRIBUNAL (ITAT, FOR SHORT) GIVING INTIMATION OF THE SAME. A COPY OF DE CLARATION FILED BY ASSESSEE IN RESPECT OF THE AFORESAID VSVS WAS ALSO ENCLOSED WITH AFORESAID LETTER DATED 04/01/2021. AT THE TIME OF HEARING BEFORE US, THE LD. AR FOR ASSESSEE SUBMI TTED BEFORE US THAT THIS APPEAL HAS BECOME INFRUCTUOUS ON ACCOUNT OF VSVS, AND MAY BE T REATED AS WITHDRAWN. THE LEARNED COMMISSIONER OF INCOME TAX (DEPARTMENTAL REPRESENTA TIVE) [LD. CIT(DR), FOR SHORT] DID NOT EXPRESS ANY OBJECTION TO THIS. AFTER DUE CONSID ERATION, AND IN VIEW OF THE FOREGOING; WE ARE OF THE OPINION THAT THIS APPEAL HAS BECOME I NFRUCTUOUS ON ACCOUNT OF AFORESAID VSVS, AND THAT THIS APPEAL MAY BE TREATED AS WITHDR AWN BY REVENUE ON ACCOUNT OF THE AFORESAID VSVS. ACCORDINGLY, THE APPEAL HAVING BE COME INFRUCTUOUS, IS TREATED AS WITHDRAWN AND, IS HEREBY DISMISSED. ITA NO.-1470/K/2010. JUBILEE INVESTMENTS & INDUSTRIES LTD. PAGE 4 OF 5 (B.1) BEFORE WE PART, WE HEREBY CLARIFY, BY WAY OF ABUNDA NT CAUTION, THAT IF FOR SOME REASON IT IS FOUND BY REVENUE THAT THE DISPUTE S UNDER THIS APPEAL BEFORE US ARE NOT FULLY SETTLED UNDER THE AFORESAID VSVS, THEN REVENUE WILL BE AT LIBERTY TO APPROACH ITAT FOR RESTORATION OF THIS AP PEAL, IN ACCORDANCE WITH LAW. (B.2) WITH THESE DIRECTIONS, THE AFORESAID APPEAL OF REV ENUE IS DISMISSED, BEING TREATED AS WITHDRAWN. (C) FOR STATISTICAL PURPOSES, THIS APPEAL IS DISMISSED. THIS ORDER WAS ALREADY PRONOUNCED ON 06 TH JANUARY, 2021 IN OPEN COURT, IN THE PRESENCE OF REPRESENTATIVES OF BOTH SIDES; AFTER CO NCLUSION OF THE HEARING. SD/- SD/- (H.S. SIDHU) (ANADEE NATH MISSHRA) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 07/01/2021 (POOJA) COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI ITA NO.-1470/K/2010. JUBILEE INVESTMENTS & INDUSTRIES LTD. PAGE 5 OF 5 DATE OF DICTATION DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE OTHER MEMBER DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR. PS/PS DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE DICTATING MEMBER FOR PRONOUNCEMENT DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR. PS/PS DATE ON WHICH THE FINAL ORDER IS UPLOADED ON THE WEBSITE OF ITAT DATE ON WHICH THE FILE GOES TO THE BENCH CLERK DATE ON WHICH THE FILE GOES TO THE HEAD CLERK THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT REGISTRAR FOR SIGNATURE ON THE ORDER DATE OF DISPATCH OF THE ORDER