Shri Babubhai Harjibhai Patel, Ahmedabad V. The Income Tax Officer, Ward-3(1), Ahmedabad

ITA 1925/AHD/2015

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 1916 (ITAT-AHMEDABAD)
• Duration Of Justice: 9 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 01-04-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 16-03-2016
• Assessment Year: 2010-2011
• Appeal Filed On: 29-06-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SONIA KUMAR
• Assessee Lawyers: HIREN TRIVEDI
• Keywords: Transactions in derivatives
• Section: 133(6)

Judgement Text

, A IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, AHMEDABAD BEFORE SHRI RAJPAL YADAV, JUDICIAL MEMBER AND SHRI N.K. BILLAIYA, ACCOUNTANT MEMBER ./ ITA.NO.1925/AHD/2015 / ASSTT. YEAR: 2010-11 SHRI BABUBHAI HARJIBHAI PATEL 3, BHAKTINAGAR SOCIETY NR.SWAMINARAYAN TEMPLE VIRATNAGAR ROAD ODHAV, AHMEDABAD 382 415. PAN : ACKPP 8568 Q VS ITO, WARD - 3(1) AHMEDABAD. ./ ITA.NO.1926/AHD/2015 / ASSTT. YEAR: 2010-11 SHRI SUNILBHAI B. PATEL 3, BHAKTINAGAR SOCIETY NR.SWAMINARAYAN TEMPLE VIRATNAGAR ROAD ODHAV, AHMEDABAD 382 415. PAN : AOIPP 4827 Q VS ITO, WARD - 3(1) AHMEDABAD. ./ ITA.NO.1927/AHD/2015 / ASSTT. YEAR: 2010-11 SMT.BHANUBEN B. PATEL 3, BHAKTINAGAR SOCIETY NR.SWAMINARAYAN TEMPLE VIRATNAGAR ROAD ODHAV, AHMEDABAD 382 415. PAN : ATKPP 8186 C VS ITO, WARD - 3(1) AHMEDABAD. ! / (APPELLANT) '# ! / (RESPONDENT) ITA NO.1925/AHD/2015 (2 OTHERS) 2 ASSESSEE BY : SHRI HIREN TRIVEDI, AR REVENUE BY : MS.SONIA KUMAR, SR.DR / DATE OF HEARING : 16/03/2016 / DATE OF PRONOUNCEMENT: 01/04/2016 $%/ O R D E R PER RAJPAL YADAV, JUDICIAL MEMBER: THESE THREE APPEALS ARE BY DIFFERENT ASSESSEES AGAI NST ORDERS OF THE LD.CIT(A)-3, AHMEDABAD FOR THE ASSTT.YEAR 2010-11. SINCE THESE ARE COGNATE MATTERS, INVOLVING COMMON ISSUES, ALL THESE APPEALS ARE DISPOSED OF BY THIS CONSOLIDATED ORDER FOR THE SAKE OF CONVENIENCE. 2. THOUGH THE ASSESSEES HAVE TAKEN THREE GROUNDS OF APPEAL, WITH ONE SUB- GROUND ALONG WITH GROUND NO.2, BUT THEIR GRIEVANCE REVOLVE AROUND A SINGLE ISSUE I.E. THE LD.CIT(A) HAS ERRED IN CONFIRMING TH E ADDITION OF RS.3,00,904/- IN THE CASE SHRI BABUBHAI HARJIBHAI PATEL, RS.7,01, 673/- IN THE CASE OF SHRI SUNILBHAI B. PATEL AND RS.7,00,767/- IN THE CASE OF SMT.BHANUBEN B. PATEL, WHICH WAS CLAIMED BY THE ASSESSEES AS LOSS MADE FRO M FUTURE AND OPINION TRANSACTIONS MADE THROUGH BROKER, M/S.EDEN FINANCIA L SERVICES. 3. SINCE FACTS ARE COMMON IN THE CASES OF ALL THESE ASSESSEE, WE TAKE THE FACTS STATED IN THE CASE OF SHRI BABUBHAI HARJIBHAI PATEL IN ITA NO.1925/AHD/2015 FOR THE SAKE OF BREVITY. 4. THE BRIEF FACTS ARE THAT THE ASSESSEE HAS FILED HIS RETURN OF INCOME ON 7.10.2010 DECLARING TOTAL INCOME AT RS.5,81,698/-. ON SCRUTINY OF THE ACCOUNTS, IT REVEALED THAT THE ASSESSEE HAS SHOWN I NCOME FROM BUSINESS AND PROFESSION AT RS.3,52,983/-. HE HAS SET OFF FUTURE AND OPTION LOSS OF RS.3,00,904/-. IN SUPPORT OF ITS CLAIM, THE ASSESS EE HAS CLAIMED A ITA NO.1925/AHD/2015 (2 OTHERS) 3 CONFIRMATION FROM BROKER M/S.EDEN FINANCIAL SERVICE S, ANDHERI (EAST), MUMBAI. HE HAS FILED CONTRACT NOTE. THE AO WROTE A LETTER TO THE NATIONAL STOCK EXCHANGE OF INDIA LTD., MUMBAI UNDER SECTION 133(6) OF THE INCOME TAX ACT ON 9.1.2013, THE NSDL HAD REPLIED THAT VI DE LETTER DATED 18.1.2013. THE REPLY OF THE NSDL HAS BEEN REPRODUCED BY THE AO ON PAGE NO.3 OF THE ASSESSMENT ORDER, WHICH READS AS UNDER: KINDLY NOTE THAT BASED ON THE PAN PROVIDED IN YOUR LETTER, NO RECORD HAVING MATCHING PATTERS WITH DATA UPLOADED BY THE T RADING MEMBERS TO THE EXCHANGE AS ON DATE FOR BABUBHAI HARJIBHAI PATE L (PAN : ACKPP8568Q) IN THE FUTURE AND OPTION SEGMENT. 5. ON THE STRENGTH OF THIS LETTER, THE LD.AO HAS DI SBELIEVED THE TRANSACTION OF THE ASSESSEE IN F&O AND DISALLOWED THE LOSS CLAI MED BY IT. ACCORDINGLY, THE LD.AO HAS MADE ADDITION OF RS.3,00,904/- AND DE TERMINED THE TAXABLE INCOME OF THE ASSESSEE AT RS.8,82,600/- AS AGAINST RS.5,81,698/- DECLARED BY THE ASSESSEE. APPEAL TO THE CIT(A) DID NOT BRING A NY RELIEF TO THE ASSESSEE. 6. BEFORE US, THE LD.COUNSEL FOR THE ASSESSEE HAS R EITERATED THE CONTENTIONS AS WERE RAISED BEFORE THE LD.REVENUE AUTHORITIES BE LOW. HE CONTENDED THAT MONEY HAS BEEN RECEIVED BY THE ASSESSEE THROUGH ACC OUNT PAYEE CHEQUE. BROKER HAS CONFIRMED THE TRANSACTION. THE ASSESSEE HAS FILED DETAILS OF CONTRACT NOTE AND CONFIRMATION GIVEN BY THE BROKER. ON THE OTHER HAND, THE LD.DR RELIED UPON THE ORDER OF THE AO. 7. ON DUE CONSIDERATIONS OF THE FACTS AND CIRCUMSTA NCES, WE FIND THAT THE INFORMATION COLLECTED BY THE AO WAS NOT SPECIFIC ON E. AO HAD MADE MENTION OF PAN OF THE ASSESSEE WITH THE INCOME TAX DEPARTMENT. THE AO OUGHT TO HAVE GOT VERIFIED THE DETAILS OF THE TRANS ACTIONS GIVEN BY THE EDEN FINANCIAL SERVICES. THESE TRANSACTIONS CONTAINED O RDER NO., TRADE NO., TRADE TIME, QUANTITY, PRICE ETC. THE AO FURTHER OUGHT TO HAVE WRITTEN A LETTER TO THE ITA NO.1925/AHD/2015 (2 OTHERS) 4 NSDL POINTING OUT THE CODE NUMBER OF EDEN FINANCIAL SERVICES LTD. AND ITS SEBI REGISTRATION NUMBER. ANY ADVERSE INFERENCE CA N BE DRAWN, IF IT IS HIGHLIGHTED BY THE NSDL THAT THESE TRANSACTIONS HAV E NOT BEEN TRANSACTED IN THE EXCHANGE. WE, THEREFORE, SET ASIDE THE IMPUGNE D ORDERS AND RESTORE THIS ISSUE TO THE FILE OF THE AO FOR RE-ADJUDICATION. 8. THE OBSERVATIONS MADE BY US WILL NOT IMPAIR OR I NJURE THE CASE OF THE AO AND WILL NOT CAUSE ANY PREJUDICE TO THE DEFENCE/ EXPLANATION OF THE ASSESSEE. 9. THE FACTS IN OTHER TWO APPEALS ARE ALSO SIMILAR. IDENTICAL INFORMATION WAS COLLECTED BY THE LD.AO FROM NSDL. THEREFORE, T HE IMPUGNED ORDER IN ITA NO.1926 AND 1927/AHD/2015 ARE ALSO SET ASIDE, A ND ISSUES ARE RESTORED TO THE FILE OF THE AO FOR RE-ADJUDICATION IN THE SAME TERMS AS IN ITA NO.1925/AHD/2015. 10. IN THE RESULT, THE APPEALS OF THE ASSESSEES ARE ALLOWED FOR STATISTICAL PURPOSE. ORDER PRONOUNCED IN THE COURT ON 1 ST APRIL, 2016 AT AHMEDABAD. SD/- SD/- ( N.K. BILLAIYA ) ACCOUNTANT MEMBER (RAJPAL YADAV) JUDICIAL MEMBER AHMEDABAD; DATED 01/04/2016