ADDL CIT RG 19(2), MUMBAI V. CHANDRESH P. SHAH, MUMBAI

ITA 1904/MUM/2011

• Counselvise Citation: [2014] 120 COUNSELVISE.COM (IT) 8345 (ITAT-MUMBAI)
• Duration Of Justice: 3 year(s) 5 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-08-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: J
• Next Hearing Date: 23-06-2014
• Assessment Year: 2006-2007
• Appeal Filed On: 08-03-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: V P KOTHARI

Judgement Text

J IN THE INCOME TAX APPELLATE TRIBUNAL J BENCH, MUMBAI BEFORE S/SHRI D. KARUNAKARA RAO, ACCOUNTANT MEMBER AND SANJAY GARG, JUDICIAL MEMBER ./ I.T.A. NO.1904 /MUM/2011 ( / ASSESSMENT YEAR : 2006-2007 A.C.I.T. 19(2), ROOM NO. 315, 3 RD FLOOR, PIRAMAL CHAMBERS, LALBAUG, PAREL, MUMBAI 400 012. / VS. SHRI CHANDRESH P. SHAH , 112, ARUN BAZAR, STATION ROAD, S.V. ROAD, SANTACRUZ (W), MUMBAI 400 054. ./ PAN : ALJPS3432L ( / APPELLANT ) .. ( / RESPONDENT ) A PPELLANT BY SHRI JEEVANLAL LAVIDIA R E SPONDENT BY : SHRI V.P. KOTHARI / DATE OF HEARING : 26-06-2014 / DATE OF PRONOUNCEMENT : 22-08-2014 [ !' / O R D E R PER SANJAY GARG, JUDICIAL MEMBER : . : # $$%, THE PRESENT APPEAL HAS BEEN PREFERRED BY THE REVENU E AGAINST THE ORDER OF LD. CIT(A) 30, MUMBAI DATED 24-12-2010 FOR A.Y. 2006-07. 2. THE REVENUE HAS TAKEN THE FOLLOWING GROUNDS OF A PPEAL:- 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE AND IN LAW, THE LEARNED CIT(A) HAS ERRED IN DELETING THE DISALL OWANCE OF RS.18,50,000/- ON ACCOUNT OF STAMP DUTY PAID WITHOU T APPRECIATING THE FACT THAT THE DECISION OF THE AO TO TREAT THE STCG AS INCOME FROM OTHER SOURCES HAS BEEN UPHELD BY HIM AND THEREFORE THE CL AIM OF THE ASSESSEE TOWARDS STAMP DUTY IS NOT ALIVE ANY MORE. ITA 1904/M/11 2 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE LEARNED CIT(A) HAS ERRED IN DELETING THE DISALL OWANCE MADE BY THE AO OF RS.18,50,000/- ON ACCOUNT OF STAMP DUTY, TREA TING THE SAME AS CASE OF DOUBLE TAXATION, WITHOUT APPRECIATING THE F ACT THAT THE GAIN EARNED BY THE ASSESSEE IS IN FACT INCOME FROM OTHER SOURCES AND THE STAMP DUTY PAID BY THE ASSESSEE IS NOT WITH RESPECT TO THE EARNING OF THE INCOME FROM OTHER SOURCES. 3. A PERUSAL OF THE ABOVE GROUNDS OF APPEAL REVEALS THAT THE REVENUE HAS CONTESTED THE ACTION OF THE LD. CIT(A) IN DELETING THE DISALLOWANCE OF RS. 18,50,000/- CLAIMED AS EXPENDITURE BY THE ASSESSEE ON ACCOUNT OF STAMP DUTY PAID. 4. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSE E IN HIS RETURN OF INCOME HAD SHOWN THE SHORT TERM CAPITAL GAINS OF RS. 3 CRO RES ON CANCELLATION OF ALLOTMENT OF TWO SHOPS. THE ASSESSEE ALSO CLAIMED T HE STAMP DUTY EXPENSES OF RS. 18,50,000/- AS EXPENDITURE INCURRED FOR EARNING THE SAID SHORT TERM CAPITAL GAINS. THE A.O. TREATED THE SAID CLAIM OF SHORT TERM CAPITAL GAINS OF RS. 3 CRORES AS INCOME FROM OTHER SOURCES AND ALS O DISALLOWED THE CLAIM OF EXPENDITURE IN RESPECT OF STAMP DUTY EXPENSES. ON A PPEAL, THE LD. CIT(A) ALSO UPHELD THE FINDINGS OF THE A.O. THAT THE SAID GAIN ON ACCOUNT OF CANCELLATION OF ALLOTMENT OF SHOPS WAS NOT CAPITAL GAINS RATHER INCOME FROM OTHER SOURCES. SO FAR SO, THE CLAIM IN RELATION TO STAMP DUTY EXPENSES WERE CONCERNED, THE LD. CIT(A) OBSERVED THAT THE ASSESSE E GOT REFUND OF THE SAID AMOUNT IN THE SUBSEQUENT YEAR AND HAD OFFERED AS HI S INCOME IN THE SUBSEQUENT A.Y. I.E. A.Y. 2008-09. HE THEREFORE HE LD THAT IF THE CLAIM OF THE ASSESSEE IN THE YEAR UNDER CONSIDERATION WAS DISALL OWED, IT WOULD AMOUNT TO DOUBLE TAXATION. HE THEREFORE DELETED THE DISALLOWA NCE IN RELATION TO STAMP DUTY EXPENSES. THE REVENUE IS THUS IN APPEAL BEFOR E US ON THIS ISSUE. 4. WE HAVE HEARD THE RIVAL CONTENTIONS OF LD. REPRE SENTATIVES OF BOTH THE SIDES AND ALSO PERUSED THE RELEVANT MATERIAL AVAILA BLE ON RECORD. IT CAN BE ITA 1904/M/11 3 OBSERVED THAT THE ASSESSEE HAD PREFERRED AN APPEAL BEFORE THE TRIBUNAL AGAINST THE IMPUGNED ORDER OF THE LD. CIT(A) (ITA N O. 2164/MUM/2011 DECIDED ON 12-4-2012) ON VARIOUS ISSUES WHEREIN THE ISSUE RELATING TO SHORT TERM CAPITAL GAIN OF RS. 3 CRORES WAS ALSO RAISED. HOWEVER, THE ASSESSEE DID NOT PRESS THE SAID ISSUE BEFORE THE TRIBUNAL AND TH E SAME WAS DISMISSED AS NOT PRESSED AND ACCORDINGLY THE SAID INCOME OF RS. 3 CRORES WAS HELD TO BE INCOME FROM OTHER SOURCES. HOWEVER, THERE IS NO DISPUTE TO THE FACT THAT THE ASSESSEE HAD DEPOSITED THE STAMP DUTY CHARGES IN TH E COURSE OF TRANSACTION OF PURCHASE OF THE SHOPS IN QUESTION. HOWEVER, SINCE T HE SAID TRANSACTION DID NOT MATURE AND THE CONTRACT WAS CANCELLED, THE ASSE SSEE APPLIED FOR REFUND OF THE STAMP DUTY CHARGES WHICH WAS REFUNDED IN THE SU BSEQUENT YEAR AND THE SAME WAS OFFERED AS INCOME FOR TAXATION BY THE ASSE SSEE IN THE SUBSEQUENT YEAR I.E. A.Y. 2008-09. UNDER SUCH CIRCUMSTANCES, IT CANNOT BE SAID THAT THE STAMP DUTY WAS NOT PAID IN RELATION TO THE TRANSACT ION IN QUESTION WHICH RESULTED AN INCOME OF RS. 3 CRORES. EVEN OTHERWISE , THE ASSESSEE HAS ALREADY OFFERED THE SAME AS ITS INCOME ON RECEIPT OF REFUND OF THE SAME. UNDER SUCH CIRCUMSTANCES, WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF THE LD. CIT(A) IN DELETING THE DISALLOWANCE MADE BY THE A.O. ON THIS ACCOUNT. 5. THERE IS NO MERIT IN THE APPEAL OF THE REVENUE A ND THE SAME IS ACCORDINGLY DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 22-08 -2014. !' ' () *! + 22-08-2014 $ , - SD/- SD/- (D. KARUNAKARA RAO) (SANJAY GARG) ACCOUNTANT MEMBER JUDICIAL MEMBER ( 7 MUMBAI ; *! DATED 22-08-2014 [ ITA 1904/M/11 4 .8../ RK , SR. PS !' # $%&' (!'% / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. 9 () / THE CIT(A) 30,, MUMBAI 4. 9 / CIT CITY- 19, MUMBAI 5. <=$ 88>? , >? , ( 7 / DR, ITAT, MUMBAI JD BENCH 6. $@% A / GUARD FILE. !' / BY ORDER, < 8 //TRUE COPY// )/* + ( DY./ASSTT. REGISTRAR) , ( 7 / ITAT, MUMBAI