KOTAK SECURITIES LTD, MUMBAI V. DCIT RG 4(3), MUMBAI

ITA 2684/MUM/2012

• Counselvise Citation: 268419914 RSA 2012
• Duration Of Justice: 1 year(s) 6 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-11-2013
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 05-11-2013
• Assessment Year: 2006-2007
• Appeal Filed On: 20-04-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SU RENDRA KUMAR
• Assessee Lawyers: FARUQE IRANI
• Keywords: Depreciation

Judgement Text

, , ,, , INCOME TAX APPELLATE TRIBUNAL,MUMBAI - A BENCH. . .. . . .. . , ,, , / !'# !'# !'# !'# , ' ' ' ' BEFORE S/SH. B.R. MITTAL, JUDICIAL MEMBER & RAJENDR A, ACCOUNTANT MEMBER /. ITA NO.2684/MUM/2012, $ $ $ $ % % % % / ASSESSMENT YEAR-2006-07 KOTAK SECURITIES LTD. 1 ST FLOOR, BAKTHAWAR 229, NARIMAN POINT MUMBAI-400020 VS DCIT RG 4(3) AAYAKAR BHAVAN, MUMBAI- 400020 PAN: AAACK3436F ( &' / APPELLANT) ( ()&' / RESPONDENT) $*+ $*+ $*+ $*+ , , , , ' '' ' / APPELLANT BY : SHRI FARUQE IRANI ! - , ' / REVENUE BY : SHRI SURENDRA KUMAR $ $ $ $ - -- - +. +. +. +. / DATE OF HEARING : 05-11-2013 /0% - +. / DATE OF PRONOUNCEMENT : 08-11-2013 $ $ $ $ , 1961 - -- - 254 )1( ' '' ' +1+ +1+ +1+ +1+ '2 '2 '2 '2 ORDER U/S.254(1)OF THE INCOME-TAX ACT,1961(ACT) PER RAJENDRA, AM: CHALLENGING THE ORDER DATED 15.12.2009 OF CIT(A)-8, MUMBAI,ASSESSEE-COMPANY HAS RAISED FOLLOWING GROUNDS OF APPEAL: PENALTY FOR DISALLOWANCE OF DEPRECIATION ON 1 ST STOCK EXCHANGE CARD AND 2 ND STOCK EXCHANGE CARD OF BOMBAY STOCK EXCHANGE THE COMMISSIONER OF INCOME TAX (APPEALS)-8 ERRED IN CONFIRMING THE PENALTY OF RS. 2,75,387/- U/S.271(1)(C)FOR ALLEGED CONCEALMENT OF INCOME AMOU NTING TO RS. 8,34,506/-ON ACCOUNT OF DISALLOW -WANCE OF DEPRECIATION ON 1 ST STOCK EXCHANGE CARD AND PENALTY OF RS.5,16,850/- U /S.271(1)(C)FOR ALLEGED CONCEALMENT OF INCOME AMOUNTING TO RS.15,66 ,211 ON ACCOUNT OF DISALLOWANCE OF DEPRECIATION ON 2 ND STOCK EXCHANGE CARD AGGREGATING TO A PENALTY OF RS .7,92,237/-. YOUR APPELLANT CRAVES LEAVE TO ADD TO, AMEND, ALTER THE ABOVE GROUNDS OF APPEAL. BRIEF FACTS OF THE CASE: ASSESSEE-COMPANY HAD FILED ITS RETURN OF INCOME ON 29.11.2006 DECLARING INCOME OF RS.325, 33,79,989/-.ASSESSING OFFICER(AO)FINALISED THE ASSE SSMENT U/S.143(3) OF THE ACT ON 30.12.2008 DETERMINING TOTAL INCOME OF THE ASSESSEE AT RS.340, 76,79,680/-.DURING THE ASSESSMENT PROCEEDINGS AO MADE CERTAIN ADDITIONS TO THE INCOME OF THE ASSE SSEE.ONE OF THE ADDITIONS,MADE BY THE AO, WAS ABOUT DEPRECIATION ON TWO STOCK EXCHANGE CARDS OF THE BOMBAY STOCK EXCHANGE.ASSESSEE FILED AN APPEAL BEFORE THE FIRST APPELLATE AUTHORIT Y (FAA)WHO GAVE PARTIAL RELIEF TO IT.WHEN THE MATTER WAS AGITATED BEFORE THE TRIBUNAL BY THE ASSE SSEE,TRIBUNAL HELD THAT ASSESSEE WAS ENTITLED TO CLAIM DEPRECIATION ON BOTH THE MEMBERSHIP CARDS OF THE BOMBAY STOCK EXCHANGE(ITA NO.1013/ MUM/2010-AY 2006-07,DATED 21.05.2012). 2. MEANWHILE AO,VIDE HIS NOTICE DATED 30.12.2008,HAD I NITIATED PENALTY PROCEEDINGS U/S 271(1)(C) OF THE ACT.AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE, HE LEVIED A PENALTY OF RS.7.92 LACS 2 ITA NO.2684/MUM/2012 KOTAK SECURITIES LTD. . FOR FURNISHING INACCURATE PARTICULARS OF THE INCOME .PENALTY ORDER OF THE AO WAS CHALLENGED BY THE ASSESSEE BEFORE THE FAA.AFTER CONSIDERING THE SUBMI SSIONS OF THE ASSESSEE AND RELYING UPON THE ORDER OF THE HONBLE SUPREME COURT DELIVERED IN THE CASE OF DHARMENDRA TEXTILES PROCESSORS (306 ITR 227),HE HELD THAT ASSESSEE HAD NOT VOLUNTARILY OFFERED THE DISALLOWANCE FOR TAXATION, THAT EXPLANATION FILED BY THE ASSESSEE WAS FALSE AND NON -BONAFIDE, THAT IT HAD CONCEALED OR HAD FURNISH -ED INACCURATE PARTICULARS OF INCOME.FINALLY,HE UPH ELD THAT ORDER OF THE AO. 3. BEFORE US,AUTHORISED REPRESENTATIVE (AR) SUBMITTED THAT G BENCH OF ITAT, MUMBAI HAD DECIDED THE ISSUE OF DEPRECIATION ON MEMBERSHIP CAR D OF THE BOMBAY STOCK EXCHANGE IN FAVOUR OF THE ASSESSEE VIDE ITS ORDER DATED 21.05.2012, TH AT ADDITIONS MADE BY THE AO WERE DELETED BY THE TRIBUNAL IN QUANTUM APPEAL,THAT AFTER THE ORDER OF THE TRIBUNAL THERE WAS NO JUSTIFICATION FOR SUSTAINING THE PENALTY LEVIED BY THE AO.DEPARTMENTA L REPRESNETATIVE (DR) SUPPORTED THE ORDER OF THE FAA. 4. WE HAVE HEARD THE RIVAL SUBMISSION AND PERUSED THE MATERIAL BEFORE US. WE FIND THAT PENALTY U/S. 271(1)(C) OF THE ACT WAS LEVIED BY THE AO AS HE WAS OF THE OPINION THAT ASSESSEE WAS NOT ENTITLED TO CLAIM DEPRECIATION ON THE MEMBERSHIP CARDS OF TH E MUMBAI STOCK EXCHANGE.WE FURTHER FIND THAT TRIBUNAL IN ITS ORDER DATED 21.05.2012 (SUPRA) HAS ALREADY HELD THAT ASSESSEE WAS ENTITLED TO CLAIM DEPRECIATION WITH REGARD TO THE MEMBERSHIP CA RDS OF BSE. AS THE TRIBUNAL HAS DELETED THE ADDITION IN THE QUANTUM PROCEEDINGS,SO PENALTY LEVI ED FOR CONCEALING THE INCOME/FURNISHING INACC -URATE PARTICULARS CANNOT SURVIVE ANY MORE. REVERSI NG THE ORDER OF THE FAA, WE DECIDE GROUND NO.1 IN FAVOUR OF THE ASSESSEE-COMPANY. AS A RESULT,APPEAL FILE D BY THE ASSESSEE STANDS ALLOWED. * +3 $*+ 4 5 - 1 !6 - !+ 78 . ORDER PRONOUNCED IN THE OPEN COURT ON 08 TH NOVEMBER,2013 . '2 - /0% ' 9 :$ 8 UOECJ UOECJ UOECJ UOECJ , 2013 0 - 1 ; SD/- SD/- ( . < < < < . . B.R.MITTAL) ( !'# !'# !'# !'# / RAJENDRA) / JUDICIAL MEMBER ' ' ' ' /ACCOUNTANT MEMBER / MUMBAI, :$ /DATE: 08 TH NOVEMBER,2013 SK '2 '2 '2 '2 - -- - (+= (+= (+= (+= >'=%+ >'=%+ >'=%+ >'=%+ / COPY OF THE ORDER FORWARDED TO : 1. ASSESSEE / &' 2. RESPONDENT / ()&' 3. THE CONCERNED CIT (A) / ? @ , 4. THE CONCERNED CIT / ? @ 5. DR A BENCH, ITAT, MUMBAI / =A1 (+$ , ,, , , . . . 6. GUARD FILE/ 1 B )=+ )=+ )=+ )=+ (+ (+(+ (+ //TRUE COPY// '2$ / BY ORDER, C / 7 ! DY./ASST. REGISTRAR , /ITAT, MUMBAI