BHARAT ENTEPRISES, MUMBAI V. DCIT CIR 12(2), MUMBAI

ITA 163/MUM/2014

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 3089 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 5 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-06-2016
• Appeal Filed By: Assessee
• Bench Allotted: B
• Assessment Year: 2006-2007
• Appeal Filed On: 07-01-2014
• Court: TRIBUNAL
• Department Lawyers: SACCH IDANAND DUBE
• Assessee Lawyers: KANTILAL B PAREKH
• Section: 154

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, MUMBAI BEFORE S/SHRI B.R. BASKARAN (AM) & RAMLAL NEGI (JM) I.T.A. NO. 163 /MUM/ 20 14 (ASSESSMENT YEAR 200 6 - 0 7 ) M/S. BHARAT ENTERPRISES 252 - A, JOLLY MAKER APARTMENT - 1 CUFFE PARADE MUMBAI - 400 005. VS. DC IT CIRCLE - 12(2) AAYAKAR BHAVAN M.K. ROAD MUMBAI - 400 020. ( APPELLANT ) ( RESPONDENT ) PAN NO . AAAFB2025N ASSESSEE BY SHRI KANTILAL B. PAREKH DEPARTMENT BY SHRI SACCHIDANAND DUBE DATE OF HEARING 7.6 . 201 6 DATE OF PRONOUNCEMENT 7 . 6 . 201 6 O R D E R PER B.R. BASKARAN, A M : - THE APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER DATED 5.11.2013 PASSED BY LEARNED CIT(A) - 2 3 , MUMBAI AND IT RELATES TO A.Y. 200 6 - 0 7 . 2. THE ASSESSEE IS AGGRIEVED BY DECISION OF LEARNED CIT(A) IN CONFIRMING THE ORDER OF THE ASSESSING OFFICER , WHO HAD HELD THAT BROUGHT FORWARD LONG TERM CAPITAL LOSS CANNOT BE SET OFF OF AGAINST SHORT TERM CAPITAL GAIN ARISING FROM SALE OF DEPRECIABLE ASSET COMPUTED U/S. 50 OF THE ACT. 3. WE HAVE HEARD THE PARTIES AND PERUSED T HE RECORD. THE ASSESSEE DECLARED LONG TERM CAPITAL GAIN ON SALE OF A FLAT AND CLAIMED A PART OF THE SAME AS DEDUCTION U/S. 54EC OF THE ACT. REMAINING AMOUNT OF LONG TERM CAPITAL GAIN OF ` 5.85 LAKHS WAS SET OFF OF AGAINST LONG TERM CAPITAL LOSS BROUGHT FO RWARD FROM THE EARLIER YEAR . DURING THE COURSE OF ASSESSMENT PROCEEDINGS , THE ASSESSING OFFICE R NOTICED THAT THE FLAT TRANSFERRED BY THE ASSESSEE WAS A DEPRECIABLE ASSET AND HENCE CAPITAL GAIN ARISING ON ITS SALE IS REQUIRED TO BE ASSESSED AS SHORT TERM CA PITAL GAIN IN TERMS OF SECTION 50 OF THE ACT. M/S. BHARAT ENTERPRISES 2 ACCORDINGLY HE ASSESSED THE SAME AS SHORT TERM CAPITAL GAIN AND ALSO DENIED SET OFF BROUGHT FORWARD LONG TERM CAPITAL LOSS AGAINST IT. IN THE APPELLATE PROCEEDINGS LEARNED CIT(A) CONFIRMED THE ACTION OF THE A SSESSING OFFICER IN THIS REGARD. THE REVENUE PREFERRED THE APPEAL CHALLENGING THE ORDER PASSED BY LEARNED CIT(A) IN RESPECT OF RELIEF GRANTED BY HIM. HOWEVER, THE ASSESSEE ACCEPTED THE ORDER OF LEARNED CIT(A). WHILE DISPOSING OF THE APPEAL FILED BY THE RE VENUE, THE TRIBUNAL EXPRESSED THE VIEW THAT THE BROUGHT FORWARD LONG TERM CAPITAL LOSS CAN BE SET OFF OF AGAINST SHORT TERM CAPITAL GAIN COMPUTED U/S. 50 OF THE ACT , IF OTHERWISE THE SAME WAS LONG TERM IN NATURE . 4. SUBSEQUENT LY, THE ASSESSEE MOVED A PETITION U/S. 154 OF THE ACT BEFORE THE ASSESSING OFFICER REQUESTING HIM TO SET OFF BROUGHT FORWARD LONG TERM CAPITAL GAINS AGAINST THE SHORT TERM CAPITAL GAINS COMPUTED U/S 50 OF THE ACT . HOWEVER, SAID COMPUTATION WAS REJECTED BY THE ASSESSING OFFICER O N THE REASONING THAT THE ASSESSEE DID NOT CONTEST THE ADVERSE DECISION RENDERED BY LEARNED CIT(A) AGAINST THE ASSESSEE ON THIS MATTER, BY FILING THE APPEAL BEFORE THE ITAT. LEARNED CIT(A) ALSO ENDORSED THE VIEW EXPRESSED BY THE ASSESSING OFFICER AND ACCORD INGLY DISMISSED THE APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER PASSED BY THE ASSESSING OFFICER U/S. 154 OF THE ACT. 5 . WE HAVE HEARD THE PARTIES AND PERUSED THE RECORD. IT IS WELL SETT LED PROPOSITION THAT THERE IS NO ESTOPPEL AGAINST LAW. ACCORDINGLY WE ARE OF THE VIEW THAT THE FAILURE OF THE ASSESSEE TO CONTEST THE DECISION OF LEARNED CIT(A) BY FILING THE APPEAL BEFORE THE TRIBUNAL WILL NOT TAKE AWAY HIS RIGHTS TO CLAIM THE BENEFIT S IN ACCORDANCE WITH THE PROVISIONS OF THE ACT. ACCORDINGLY WE ARE OF THE VIEW THAT THE REASONING GIVEN BY THE ASSESSING OFFICER AS WELL AS LEARNED CIT(A) FOR REJECTING THE RECTIFICATION PETITION FILED BY THE ASSESSEE IS NOT SUSTAINABLE IN LAW. ACCORDINGLY, WE SET ASIDE THE ORDER OF LEARNED CIT(A) AND RESTORE THE MATTER TO T HE FILE OF THE ASSESSING OFFICER WITH THE DIRECTION TO EXAMINE THE SAME AFRESH BY AFFORDING ADEQUATE OPPORTUNITY OF BEIN G HEARD TO THE ASSESSEE AND TAKE APPROPRIATE DECISION IN ACCORDANCE WITH LAW. M/S. BHARAT ENTERPRISES 3 6 . IN THE RESULT, APPEAL FILED BY THE ASSESSEE IS TREATED AS ALLOWED FOR STATISTICAL PURPOSES. ORDER HAS BEEN PRONOU NCED IN THE OPEN COURT ON 7 .6 .2016 . SD/ - SD/ - (RAMLAL NEGI ) (B.R.BASKARAN ) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI ; DATED : 7 / 6/ 20 1 6 COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT(A) 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE. BY ORDER, //TRUE COPY// ( DY./ASSTT. REGISTRAR) ITAT, MUMBAI PS