D.C.I.T Cir - 5,kolkata, Kolkata V. M/s Bagaria More Co Ltd, Kolkata

ITA 1781/KOL/2013

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 5123 (ITAT-KOLKATA)
• Duration Of Justice: 2 year(s) 7 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-01-2016
• Appeal Filed By: Department
• Bench Allotted: C
• Assessment Year: 2007-2008
• Appeal Filed On: 06-06-2013
• Court: TRIBUNAL
• Keywords: Capital asset converted into stock in trade; Tax effect
• Section: 143(3); 147

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH: KOL KATA [BEFORE SHRI N.V.VASUDEVAN, JM & SHRI WASEEM AHMED , AM ] ITA NO. &A.Y. REVENUE/REP. BY VS ASSESSEE/PAN/REP. BY 1781/KOL/2013 AY. 2007-08 DCIT, CIRCLE-5, KOLKATA REP. BY SHRI NILOY BARAN SOM, JCIT, SR.DR M/S. BAGARIA MORE CO.LTD., AABCB4387R, REP. BY NONE 23A, N.S.ROAD, FORTUNE TOWERS, KOLKATA-700001. 725/KOL/2013 AY. 2008-09 ITO, WD-1(2), HOOGHLY REP. BY SHRI NILOY BARAN SOM, JCIT, SR.DR M/S.A.S.A. & CO., AAJFM1599F REP. BY NONE, C/O SRI SUBAL CHANDRA DUTTA, 9/24/6, SARAT SARANI, 1 ST LANE, P.O.MOREPUKUR (SAHAPARA) RISHRA, DT. HOOGHLY 712250. 897/KOL/2012 AY. 2006-07 ITO, WD-29(4),KOLKATA REP. BY SHRI NILOY BARAN SOM, JCIT, SR.DR SHRI ANUP MITTAL, AIMPM6607R REP. BY NONE, 11/1, NEW ROAD, KOLKATA-700027. 117/KOL/2013 AY. 2009-10 DCIT, CIR-56, KOLKATA REP. BY SHRI NILOY BARAN SOM, JCIT, SR.DR M/S. GOEL ROADWAYS AACFG5244N REP BY NONE, 55B, M.G.ROAD, KOLKATA-700007. 940/KOL/2013 AY. 2005-06 DCIT, CIR-10, KOLKATA REP. BY SHRI NILOY BARAN SOM, JCIT, SR.DR M/S. DEYS MEDICAL STORES PVT. LTD., AABCD4017E, REP. BY NONE 20-A, NELLY SENGUPTA SARANI, KOLKATA-700087. 290/KOL/2012 AY. 2007-08 ITO, WD-45(2),KOLKATA REP. BY SHRI NILOY BARAN SOM, JCIT, SR.DR SHRI GOPAL CHAMARIA, ACQPC7138K REP. BY SHRI V.N.PUROHIT, FCA, 43, BURTOLLA STREET, KOLKATA-700007. 2075/KOL/2010 AY. 2004-05 DCIT, CIRCLE-3, KOLKATA REP. BY SHRI NILOY BARAN SOM, JCIT, SR.DR M/S. SHREE HANUMAN SUGAR & INDUSTRIES LTD., AAECS0448M REP. BY NONE 12, GOVT. PLACE (E), KOLKATA-700069. 1692/KOL/2013 AY. 2004-05 ITO, WD-28(3),KOLKATA REP. BY SHRI NILOY BARAN SOM, JCIT, SR.DR SHRI RAN VIJAY SINGH, AMHPS8770J REP. BY NONE, 2, HIDE ROAD, KOLKATA-700043. 1693/KOL/2013 AY. 2005-06 ITO, WD-28(3),KOLKATA REP. BY SHRI NILOY BARAN SOM, JCIT, SR.DR SHRI RAN VIJAY SINGH, AMHPS8770J REP. BY NONE, 2, HIDE ROAD, KOLKATA-700043. 437/KOL/2013 AY. 2009-10 ITO, WD-36(3),KOLKATA REP. BY SHRI NILOY BARAN SOM, JCIT, SR.DR SMT. SADHNA SINGH, AKQPS6544K REP. BY NONE 10, OLD POST OFFICE STREET, ROOM NO.24&25, KOLKATA-700001. 86/KOL/2012 AY. 2001-02 DCIT, CIRCLE-11,KOLKATA REP. BY SHRI NILOY BARAN SOM, JCIT, SR.DR M/S. SURYA KIRAN TEXTILES PVT. LTD. AAECS2527H, REP. BY NONE 8, GANESH CHANDRA AVENUE, KOLKATA-700013. 463/KOL/2013 AY. 2009-10 ITO, WD-9(3), KOLKATA REP. BY SHRI NILOY BARAN SOM, JCIT, SR.DR M/S. JAWALA COLD STORAGE LTD., AAACJ6673R, REP. BY NONE RAMESWARA APARTMENT, FLAT NO.11C, 19A, SARAT BOSE ROAD, KOLKATA-700020. 715/KOL/2012 AY. 1996-97 I.T.O.,WD-9(4),KOLKATA REP. BY SHRI NILOY BARAN SOM, JCIT, SR.DR M/S. SAGAR TREXIM (P)LTD., AAECS8194E, REP. BY NONE 9, JAGMOHAN MULLICK LANE, KOLKATA-700007. 908 /K/2012 AY. 2005-06 DCIT, CIRCLE-8,KOLKATA REP. BY SHRI NILOY BARAN SOM, JCIT, SR.DR M/S. CARBON FINANCE LTD., AABCB9071C, REP. BY NONE, 31, J L NEHRU ROAD, KOLKATA-700071. 1771/KOL/2014 AY. 2005-06 ITO, WD-11(1),KOLKATA REP. BY SHRI NILOY BARAN SOM, JCIT, SR.DR M/S. THE BOND COMPANY PVT. LTD., AAACT9317Q, REP. BY NONE, 31, CHOWRINGHEE ROAD, GRAPHITE INDIA OFFICE PREMISES, KOLKATA-700016. 566/KOL/2013 AY. 2004-05 ITO, WD-36(2),KOLKATA REP. BY SHRI NILOY BARAN SOM, JCIT, SR.DR SHANKAR PRASAD SHAW, ALYPS1471Q REP. BY NONE, 11A, POLLOCK STREET, 3 RD FLOOR, KOLKATA-700001. 1385/KOL/2010 AY. 2003-04 DCIT, CENTRAL CIRCLE-XXVII, ,KOLKATA REP. BY SHRI NILOY BARAN SOM, JCIT, SR.DR M/S. PRATAP PROPERTIES LTD., AADCP6647E, REP. BY NONE, 178, M.G.ROAD, 2 ND FLOOR, ROOM NO.110, KOLKATA- 700007. 2 2 1021/KOL/2013 AY. 2006-07 ITO, WD-8(3), KOLKATA REP. BY SHRI NILOY BARAN SOM, JCIT, SR.DR M/S LMJ PROJECTS PVT.LTD., AABCL0006H, REP. BY NONE, 30, J.L.NEHRU ROAD, KOLKATA-700016. 1002/KOL/2013 AY. 2006-07 DCIT, CIRCLE-8,KOLKATA REP. BY SHRI NILOY BARAN SOM, JCIT, SR.DR M/S. ZOOM ENTERPRISES LIMITED, AAACZ0872A, REP. BY NONE, X-1, 8/3, BLOCK-EP, SECTOR-V, ELECTRONICS COMPLEX, SALT LAKE, KOLKATA-700091. 986/KOL/2013 AY. 2009-10 DCIT, CIR-8, KOLKATA REP. BY SHRI NILOY BARAN SOM, JCIT, SR.DR M/S. ANIL KUMAR PAIK, AFLPP6567R REP. BY NONE, FLAT NO.3ABC, 2, B.S.N.ROY ROAD, BEHALA, KOLKATA-700034. 506/KOL/2014 AY 2006-07 ITO,WD-12(3), KOLKATA REP. BY SHRI NILOY BARAN SOM, JCIT, SR.DR AJAY INVESTMENT ENTERPRISE LTD. AACCA7603A REP. BY NONE, 11/1, SARAT BOSE ROAD, IDEAL PLAZA, KOLKATA-20. 1319/KOL/2011 AY 2007-08 ACIT,CC-IV, KOLKATA REP. BY SHRI NILOY BARAN SOM, JCIT, SR.DR M/S. JAIN INFRA PROJECTS LTD., AACCB9831F, REP. BY NONE 39, SHAKESPEARE SARANI, KOLKATA-17. 2141/KOL/2010 AY. 2007-08 ITO, WD-1(2),DURGAPUR REP. BY SHRI NILOY BARAN SOM, JCIT, SR.DR DEBAPRATIM NEOGIE, ADJPN3070H REP. BY NONE, NUTANPALLY, BENACHITY, DURGAPUR. 1167/KOL/2012 AY. 2008-09 ITO, WD-56(4),KOLKATA REP. BY SHRI NILOY BARAN SOM, JCIT, SR.DR M/S. NOPANY & SONS, AACFN5493N, REP. BY NONE, 3, PRETORIA STREET, KOLKATA-700071. 432/KOL/2011 AY. 2007-08 ACIT, CIR.50, KOLKATA REP. BY SHRI NILOY BARAN SOM, JCIT, SR.DR M/S. DEBAYAN BHATTACHARYA, AAJPB2128D, REP. BY NONE, DB-29, SALT LAKE, KOLKATA-700064. 954/KOL/2013 AY. 2006-07 DCIT, CIR.9, KOLKATA REP. BY SHRI NILOY BARAN SOM, JCIT, SR.DR M/S. ITT SHIPPING PVT. LTD., AACI5499Q, REP. BY NONE, 4, FAIRLIE PLACE, 6 TH FLOOR, KOLKATA-700001. 915/KOL/2013 AY. 2007-08 ITO, WD-12(1),KOLKATA REP. BY SHRI NILOY BARAN SOM, JCIT, SR.DR ANURADHA HALWASIYA , AASPH8289G REP. BY NONE, 1A, RUSTAMJI STREET, KOLKATA- 700019. 506/KOL/2012 AY. 1999-2000 ITO,WD-29(2) KOLKATA REP. BY SHRI NILOY BARAN SOM, JCIT, SR.DR LATE KRISHNA KISHORE KAR REP. BY SMT. SUPRIYA CHAKRAVARTY (L/H) PAN/GIR NO.29(2)PZ-6100/KOL, REP. BY NONE, 127, BAKUL BAGAN ROAD, KOLKATA- 700025. 569/KOL/2013 AY. 2009-10 ITO, WD-36(2), KOLKATA REP. BY SHRI NILOY BARAN SOM, JCIT, SR.DR M/S. SHREE KRISHNA DEVELOPERS, AAAAS9791F, REP. BY NONE, 78, BENTICK STREET, 5 TH FLOOR, KOLKATA-700001. 419/K/2013 AY. 2009-10 ITO,WD-56(4), KOLKATA REP. BY SHRI NILOY BARAN SOM, JCIT, SR.DR M/S. KRISHNA INTERNATIONAL, AAIFK4313L, REP. BY NONE, 4/7A, WATERLOO STREET, KOLKATA-700069. 530/KOL/2013 AY. 2004-05 ITO, WD-55(1), KOLKATA REP. BY SHRI NILOY BARAN SOM, JCIT, SR.DR DR. SUDHIR KUMAR GHOSH, ADVPG0017B, REP. BY SHRI SOUMITRA CHOWDHURY, ADVOCATE, 2, NYAYRATNA LANE, SHYAMBAAR, KOLKATA-700004. 531/KOL/2013 AY. 2005-06 ITO, WD-55(1), KOLKATA REP. BY SHRI NILOY BARAN SOM, JCIT, SR.DR DR. SUDHIR KUMAR GHOSH, ADVPG0017B, REP. BY SHRI SOUMITRA CHOWDHURY, ADVOCATE, 2, NYAYRATNA LANE, SHYAMBAAR, KOLKATA-700004. 389/KOL/2013 AY 2007-08 ITO, WD-1(2), MIDNAPORE, REP. BY SHRI NILOY BARAN SOM, JCIT, SR.DR SK. INTAJ ALI KHAJN, APHPK1261K REP. BY NONE, VILL. HATIHALKA, RAMNAGAR GOPINATHPUR, DIST. PASCHIM MEDINIPUR-721305. 799/KOL/2013 AY. 2007-08 DCIT, CIRCLE-1,KOLKATA REP. BY SHRI NILOY BARAN SOM, JCIT, SR.DR M/S. AVERY INDIA LTD., AACCA4694B REP. BY NONE, 28/2, WATERLOO STREET, KOLKATA- 700069. 908/KOL/2013 AY. 2009-10 ACIT, CIRCLE-36,KOLKATA REP. BY SHRI NILOY BARAN SOM, JCIT, SR.DR THE BANK EMPLOYEES CO-OPERATIVE BANK LTD., AABAT5298D REP. BY NONE, 23A, N.S.ROAD, 3 RD FLOOR, KOLKATA- 700001. 290/KOL/2013 AY. 2008-09 ITO,WD-30(2),KOLKATA REP. BY SHRI NILOY BARAN SOM, JCIT, SR.DR MUKESH RATHI, ADKPR4495F REP. BY SHRI S.M.SURANA, ADVOCATE, HIG-A-1B-2, POUSHALEE HOUSING ESTATE, 1, RAJA 3 3 RAM MOHAN ROY ROAD, KOLKATA-700041. 454/KOL/2013 AY. 2009-10 ITO,WD-55(2),KOLKATA REP. BY SHRI NILOY BARAN SOM, JCIT, SR.DR M/S. MEDVUE MEDICAL SERVICES, AAQFM2793N, REP. BY SHRI S.M.SURANA, ADVOCATE, 40/1, TOLLYGUNJE CIRCULAR ROAD, KOLKATA-700053. 462/KOL/2013 AY 2006-07 ITO,WD-9(2),KOLKATA REP. BY SHRI NILOY BARAN SOM, JCIT, SR.DR M/S. GALAXY VYAPAAR PVT. LTD., AACCG4732G, REP. BY MISS VARSHA JALAN, ADVOCATE, 158, J.L.BAJAJ STREET, KOLKATA-700007. 1300/KOL/2013 AY 2009-10 DCIT, CIR.9, KOLKATA REP. BY SHRI NILOY BARAN SOM, JCIT, SR.DR M/S.ARVIND KUMAR NAND KUMAR LTD., AACCA6319F, REP. BY NONE, 30, BHATTER HOUSU, KALI KRISHNA TAGORE STREET, KOLKATA-700007. C.O.84/K/2013 A/O 1300/KOL/2013 AY 2009-10 M/S.ARVIND KUMAR NAND KUMAR LTD., AACCA6319F, REP. BY NONE, 30, BHATTER HOUSU, KALI KRISHNA TAGORE STREET, KOLKATA-700007. DCIT, CIR.9, KOLKATA REP. BY SHRI NILOY BARAN SOM, JCIT, SR.DR 183/KOL/2013 AY 2002-03 ITO, WD-12(4), KOLKATA. REP. BY SHRI NILOY BARAN SOM, JCIT, SR.DR M/S. STEEL PRODUCTS LTD., AAECS9294F REP. BY MISS. VARSHA JALAN, ADVOCATE, 96, GARDEN REACH ROAD, KOLKATA-700023. 810/KOL/2013 AY 2001-02 ITO, WD-12(4), KOLKATA REP. BY SHRI NILOY BARAN SOM, JCIT, SR.DR M/S. STEEL PRODUCTS LTD. AAECS9294F REP. BY MISS. VARSHA JALAN, ADVOCATE, 96, GARDEN REACH ROAD, KOLKATA-700023. 645/KOL/2013 AY 2009-10 ITO, WD-2(4), HOOGHLY, REP. BY SHRI NILOY BARAN SOM, JCIT, SR.DR SHRI RAMEN KUNDU, AFIPK3363D REP. BY NONE, VILL. GANGPUR, P.O.PIKHAN , P.S.ARAMBAGH, DIST.HOOGHLY, PIN-712613. DATE OF HEARING: 14.01.2016 DATE OF PRONOUNCEMENT: 14.01.2016 ORDER PER N.V.VASUDEVAN, JM THESE APPEALS OF THE REVENUE ARE AGAINST DIFFERENT ORDERS OF THE CIT(A) AGAINST THE ORDERS OF ASSESSMENT FRAMED U/S 147 / 143(3) / 144 OF THE INCOME TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT) IN THE CASE OF DIFFERENT ASSESSEES F OR DIFFERENT ASSESSMENT YEARS AS SET OUT IN THE CAUSE TITLE ABOVE. 2. RECENTLY THE CBDT HAS ISSUED CIRCULAR NO. 2 1/2015, DATED 10TH DECEMBER, 2015, WHEREBY THE MONETARY LIMITS FOR FILING OF APPEALS BY THE DE PARTMENT BEFORE INCOME TAX APPELLATE TRIBUNAL AND HIGH COURTS AND SLP BEFORE SUPREME COU RT HAVE BEEN INCREASED AS MEASURE FOR REDUCING LITIGATION. THE REVISED MONETARY LIMITS LAID DOWN IN PARA-3 OF THIS CIRCULAR AND THE MANNER OF COMPUTING TAX EFFECT AS LAID DOWN IN PARA -4 OF THIS CIRCULAR ARE AS FOLLOWS: 3. HENCEFORTH, APPEALS/ SLPS SHALL NOT BE FILED I N CASES WHERE THE TAX EFFECT DOES NOT EXCEED THE MONETARY LIMITS GIVEN HEREUNDER: - 4 4 SL. NO. APPEALS IN INCOME-TAX MATTERS MONETARY LIMIT (IN RS) 1. BEFORE APPELLATE TRIBUNAL 10,00,000/- 2. BEFORE HIGH COURT 20,00,000/- 3. BEFORE SUPREME COURT 25,00,000/- IT IS CLARIFIED THAT AN APPEAL SHOULD NOT BE FILED MERELY BECAUSE THE TAX EFFECT IN A CASE EXCEEDS THE MONETARY LIMITS PRESCRIBED ABOVE. FILING OF APP EAL IN SUCH CASES IS TO BE DECIDED ON MERITS OF THE CASE. 4. FOR THIS PURPOSE, 'TAX EFFECT' MEANS THE DIFFERE NCE BETWEEN THE TAX ON THE TOTAL INCOME ASSESSED AND THE TAX THAT WOULD HAVE BEEN CHARGEABL E HAD SUCH TOTAL INCOME BEEN REDUCED BY THE AMOUNT OF INCOME IN RESPECT OF THE ISSUES AGAINST W HICH APPEAL IS INTENDED TO BE FILED (HEREINAFTER REFERRED TO AS 'DISPUTED ISSUES'). HOW EVER THE TAX WILL NOT INCLUDE ANY INTEREST THEREON, EXCEPT WHERE CHARGEABILITY OF INTEREST ITS ELF IS IN DISPUTE. IN CASE THE CHARGEABILITY OF INTEREST IS THE ISSUE UNDER DISPUTE, THE AMOUNT OF INTEREST SHALL BE THE TAX EFFECT. IN CASES WHERE RETURNED LOSS IS REDUCED OR ASSESSED AS INCOME, THE TAX EFFECT WOULD INCLUDE NOTIONAL TAX ON DISPUTED ADDITIONS. IN CASE OF PENALTY ORDERS, THE TAX EFFECT WILL MEAN QUANTUM OF PENALTY DELETED OR REDUCED IN THE ORDER TO BE APPEALED AGAINST. 3. IN PARA-10 OF THE SAID CIRCULAR IT HAS FURTHER BEEN CLARIFIED THAT THE REVISED MONETARY LIMITS WILL APPLY RETROSPECTIVELY. THE RELEVANT PARA-10 O F THE CIRCULAR READS THUS: 10. THIS INSTRUCTION WILL APPLY RETROSPECTIVELY TO PENDING APPEALS AND APPEALS TO BE FILED HENCEFORTH IN HIGH COURTS/ TRIBUNALS. PENDING APPEA LS BELOW THE SPECIFIED TAX LIMITS IN PARA 3 ABOVE MAY BE WITHDRAWN/ NOT PRESSED. APPEALS BEFORE THE SUPREME COURT WILL BE GOVERNED BY THE INSTRUCTIONS ON THIS SUBJECT, OPERATIVE AT THE TIME WHEN SUCH APPEAL WAS FILED. 4. IN THE APPEALS FILED BY THE REVENUE, LISTED IN THE CAUSE TITLE TO THIS ORDER, THE TAX EFFECT IS LESS THAN RS.10,00,000/-. THOUGH THESE APPEALS HAV E BEEN FILED BY THE REVENUE PRIOR TO THE CBDT CIRCULAR NO. 21/2015 AND WERE WITHIN THE MONET ARY LIMIT IN THE FORM OF TAX EFFECT FOR FILING APPEALS BEFORE TRIBUNAL AT THE TIME OF FILIN G OF THE APPEALS, IN VIEW OF PARA-10 OF THE CIRCULAR OF CBDT, EVEN SUCH APPEALS WILL BE GOVERNE D BY THE NEW MONETARY LIMITS LAID DOWN IN THE CBDT CIRCULAR NO.21/2015 REFERRED TO ABOVE AND ARE LIABLE TO DISMISSED AS CONTRARY TO THE CBDT CIRCULAR AND ARE LIABLE TO BE DISMISSED IN LIMINE, AS UNADMITTED. 5. IT IS A SETTLED LAW THAT THE CIRCULARS ISSUED BY CBDT ARE BINDING ON THE REVENUE. THIS POSITION WAS CONFIRMED BY THE APEX COURT IN THE CA SE OF COMMISSIONER OF CUSTOMS VS INDIAN OIL CORPORATION LTD. REPORTED IN 267 ITR 272 WHEREI N THEIR LORDSHIPS EXAMINED THE EARLIER DECISIONS OF THE APEX COURT WITH REGARD TO BINDING NATURE OF THE CIRCULAR AND LAID DOWN THAT WHEN A CIRCULAR ISSUED BY THE BOARD REMAINS IN OPER ATION THEN THE REVENUE IS BOUND BY IT AND CANNOT BE ALLOWED TO PLEAD THAT IT IS NOT VALID OR THAT IT IS CONTRARY TO THE TERMS OF THE STATUTE. TH E 5 5 APPEAL UNDER CONSIDERATION HAS CERTAINLY BEEN FILED CONTRARY TO THE CIRCULAR ISSUED BY THE CBDT CIRCULAR NO.21 DATED 10.12.2015. 5.1. IN THE EVENT THE REVENUE FINDS AT A LATER POIN T OF TIME THAT THE TAX EFFECT IN ANY OF THESE APPEALS ARE/IS MORE THAN RS.10 LAKHS OR DESPITE LOW TAX EFFECT ANY APPEAL OF THE REVENUE IS MAINTAINABLE, THE REVENUE IS AT LIBERTY TO MOVE THI S TRIBUNAL FOR RECALL OF THIS ORDER. 5.2. SINCE REVENUES APPEAL IN ITA NO.1300/KOL/201 3 REFERRED TO IN THE CAUSE TITLE OF THIS ORDER, IS BEING DISMISSED AS UNADMITTED, THE C.O. F ILED BY THE ASSESSEE IN THE AFORESAID APPEAL, WHICH IS PURELY SUPPORTIVE IN NATURE I.E., CO NO.84 /KOL/2013 IS ALSO DISMISSED AS INFRUCTUOUS. 6. IN VIEW OF THE ABOVE, WE HOLD THAT THE APPEALS F ILED BY THE DEPARTMENT, AGAINST THE IMPUGNED ORDERS OF THE LD. CIT(A), ARE CONTRARY TO THE POLICY DECISION OF THE DEPARTMENT AND AS SUCH THE APPEALS FILED BY THE DEPARTMENT ARE DISMIS SED IN LIMINE . 7. IN THE RESULT, ALL THE APPEALS BY THE REVENUE ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT. SD/- SD/- (WASEEM AHMED) (N.V.VASUDEVAN) ACCOUNTANT MEMBER JUDICIAL MEMB ER DATED : 14 TH JANUARY, 2016. RG. P.S COPY OF THE ORDER FORWARDED TO: 1. APPELLANT 2 RESPONDENT 3. THE CIT(A), KOLKATA 4. 5. CIT KOLKATA DR, KOLKATA BENCHES, KOLKATA / TRUE COPY, BY ORDER, ASSTT. REGISTRAR .