ACIT, UDAIPUR V. Smt. Sonal Abhay Mehta, UDAIPUR

ITA 278/JODH/2011

• Counselvise Citation: 27823314 RSA 2011
• Duration Of Justice: 2 year(s) 4 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-11-2013
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 27-11-2013
• Assessment Year: 2006-2007
• Appeal Filed On: 07-07-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: N A JOSHI
• Assessee Lawyers: G K GARGIEYA
• Keywords: Business income

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL JODHPUR BENCH, JODHPUR BEFORE SHRI HARI OM MARATHA, JUDICIAL MEMBER AND SHRI N.K. SAINI, ACCOUNTANT MEMBER ITA NO.278/JODH/2011 ASST. YEAR: 2006-07 ASSTT. COMMISSIONER OF INCOME TAX, VS. SMT. SONAL ABHAY MEHTA, CIRCLE-2, JODHPUR. 27, OLD FATEHPURA, UDAIPUR. (PAN: ABFPM 0948 K) (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI N.A. JOSHI, D.R. RESPONDENT BY : SHRI G.K. GARGIEYA & SHRI SARVESH BALDI DATE OF HEARING : 27.11.2013 DATE OF PRONOUNCEMENT : 28 .11.2013 ORDER PER HARI OM MARATHA, JUDICIAL MEMBER: THIS APPEAL OF THE REVENUE FOR A.Y. 2006-07 IS DIR ECTED AGAINST THE ORDER OF LD. CIT(A), UDAIPUR DATED 13.05.2011. 2. THE FACTS APROPOS THE SOLE ISSUE RAISED IN THIS APPEAL IS REGARDING FINDING OF THE LD. CIT(A) THAT A SUM OF RS.48,37,762/- AS SHOR T TERM CAPITAL GAIN (STCG) AND NOT ASSESSEES BUSINESS INCOME AS HAS BEEN HELD BY THE A.O., ARE THAT THE ASSESSEE HAS SHOWN THIS AMOUNT AS INCOME UNDER THE HEAD STCG ON SALE OF SHARES. ON GOING THROUGH THE DETAILS OF THIS INCOM E, THE A.O. NOTICED THAT THE 2 ITA NO.278/JODH/2011 A.Y. 2006-07 ASSESSEE WOULD PURCHASE AND SELL SHARES AND THE QUA NTUM OF SUCH SALE BEING SUBSTANTIAL THROUGHOUT THE YEAR, THIS INCOME HAS TO BE TREATED AS HIS BUSINESS INCOME. AFTER SHOW-CAUSING THE ASSESSEE IN THIS RE GARD, THE A.O. HAS TREATED THE SAME AS ASSESSEES BUSINESS INCOME. 3. AGGRIEVED, THE ASSESSEE FILED APPEAL AND AFTER D ISCUSSING VARIOUS ASPECT OF THIS ISSUE, THE LD. CIT(A) HAS FINALLY FOUND THAT W HEN THE INVESTMENT IN SHARES HAS BEEN SHOWN IN THE BOOKS OF THE ASSESSEE AS WELL AS IN THE BALANCE SHEET AND HAS NOT TREATED AS INVESTMENT BY THE A.O., HOWEVER, IN EARL IER YEARS SUCH INVESTMENT HAS BEEN ACCEPTED BY THE A.O. AND BY KEEPING THE PRINCI PLE OF CONSISTENCY, THIS ADDITION HAS TO BE DELETED. ACCORDINGLY, HE HAS DE LETED THIS ADDITION. 4. BEFORE US BOTH THE PARTIES HAVE REITERATED THEIR EARLIER STAND. 5. AFTER CONSIDERING THE RIVAL SUBMISSIONS, WE HAVE FOUND THAT THE INTENTION OF THE ASSESSEE WAS TO BE INVESTOR FROM THE BEGINNING ITSELF AS THE PURCHASES WERE MADE THROUGH DE-MAT ACCOUNT FROM HIS OWN FUNDS AND THE HOLDING PERIOD OF THE SHARES AND TREATMENT GIVEN THE BOOKS OF ACCOUNT. T HEREFORE, THE FINDING OF LD. CIT(A) CANNOT BE FAULTED WITH. THE ONLY FACT THAT THE ASSESSEE HAS DONE VOLUMINOUS ACTIVITIES OF INVESTING ITSELF CANNOT BE CONVERTED INTO BUSINESS. ACCORDINGLY, BY THE SUPPORTING REASONING OF THE LD. CIT(A), WE HAVE FOUND THAT THE ASSESSEE IS A REGULAR INVESTOR AND IN THE PAST WHAT EVER PROFIT EARNED ON 3 ITA NO.278/JODH/2011 A.Y. 2006-07 PURCHASE/SALE WERE ASSESSED, IT WAS ASSESSED UNDER THE HEAD CAPITAL GAIN. IN THE PAST ANY SUCH STCG OR LTCG WERE NEVER TREATED AS BU SINESS INCOME OF THE ASSESSEE. ACCORDINGLY, BY FOLLOWING THE RULE OF CO NSISTENCY LAID DOWN IN THE DECISION OF RADHA SWMI SATSANG VS. CIT, 193 ITR 321 (S.C.), WE HAVE TO AFFIRM THE IMPUGNED FINDING. THE LD. AUTHORIZED REPRESENT ATIVE HAS PLACED RELIANCE ON VARIOUS OTHER DECISIONS INCLUDING THAT OF THIS VERY BENCH IN THIS REGARD AND WHICH WE NEED NOT BE REPEATED IN VIEW OF THE MAIN DECISIO N OF HONBLE SUPREME COURT (SUPRA). ACCORDINGLY, WE DO NOT FIND ANY MERIT IN THIS APPEAL OF THE REVENUE AND DISMISS THE SAME. 6. IN THE RESULT, APPEAL FILED BY THE REVENUE STAND S DISMISSED. (ORDER PRONOUNCED IN THE OPEN COURT ON 28.11.2013) SD/- SD/- (N.K. SAINI) (HARI OM MARATHA) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 28 TH NOVEMBER, 2013 PBN/* COPY OF THE ORDER FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT (APPEALS) CONCERNED 4. CIT CONCERNED 5. D.R., ITAT, JODHPUR BENCH, JODHPUR 6. GUARD FILE. BY ORDER ASSISTANT REGISTRAR INCOME-TAX APPELLATE T RIBUNAL, JODHPUR