Carborundum Universal Limited, CHENNAI V. Addl. CIT, CHENNAI

ITA 299/CHNY/2015

• Counselvise Citation: 29921714 RSA 2015
• Duration Of Justice: 3 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-05-2015
• Appeal Filed By: Assessee
• Bench Allotted: D
• Next Hearing Date: 11-05-2015
• Assessment Year: 2004-2005
• Appeal Filed On: 03-02-2015
• Court: TRIBUNAL
• Department Lawyers: N MADHAVAN
• Assessee Lawyers: R VIJAYARAGHAVAN
• Keywords: Capital asset

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH : CHENNAI . . . , . !' , # $ % [ BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER ] ./ I.T.A.NO.299/MDS/2015 / ASSESSMENT YEAR : 2004-05 M/S CARBORUNDUM UNIVERSAL LTD. PARRY HOUSE 43 MOORE STREET CHENNAI 600 001 VS. THE DY. COMMISSIONER OF INCOME-TAX LARGE TAXPAYER UNIT CHENNAI [PAN AAACC2474P] ( &' / APPELLANT) ( ()&' /RESPONDENT) / APPELLANT BY : SHRI R. VIJAYARAGHAVAN, ADVOCATE /RESPONDENT BY : SHRI N. MADHAVAN, JCIT / DATE OF HEARING : 11-05-2015 ! / DATE OF PRONOUNCEMENT : 29-05-2015 / O R D E R PER N.R.S.GANESAN, JUDICIAL MEMBER THIS APPEAL OF THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE COMMISSIONER OF INCOME-TAX (APPEALS), LARGE TA XPAYER UNIT, CHENNAI, DATED 31.10.2014 AND PERTAINS TO ASSESSMEN T YEAR 2004-05. 2. THE ONLY ISSUE ARISES FOR CONSIDERATION IS DISALLOW ANCE OF LONG TERM CAPITAL LOSS OF ` 44.09 LAKHS ON CONVERSION OF UNITS OF US 64. ITA NO.299/15 :- 2 -: 3. SHRI R. VIJAYARAGHAVAN, LD. COUNSEL FOR THE ASSESSE E SUBMITTED THAT THE ASSESSEE INCURRED LONG TERM CAP ITAL LOSS OF ` 88,08,188/- WHICH INCLUDED LOSS ON ACCOUNT OF TRANS FER/REDEMPTION OF US 64 UNITS TO THE EXTENT OF ` 44,09,684/-. THE ASSESSEE ADJUSTED THE LONG TERM CAPITAL LOSS AGAINST THE GAINS FROM SALE OF OTHER LONG TERM CAPITAL ASSETS. HOWEVER, THE ASSESSING OFFICER DIS ALLOWED THE CLAIM OF THE ASSESSEE ON THE GROUND THAT THE SAME CANNOT BE ALLOWED U/S 10(33) OF THE ACT. REFERRING TO SECTIONS 70 AND 74 OF THE ACT, THE LD. COUNSEL SUBMITTED THAT SECTIONS 70 AND 74 DO NOT SA Y THAT THE CAPITAL LOSS ARISES ON SALE/CONVERSION OF US 64 UNITS CANNO T BE ALLOWED. THEREFORE, ACCORDING TO THE LD. COUNSEL, CONVERSION OF UNITS OF US 64 HAS TO BE SET OFF AGAINST THE OTHER LONG TERM CAPIT AL GAINS. 4. WE HEARD SHRI N.MADHAVAN, LD. DEPARTMENTAL REPRESEN TATIVE ALSO. 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITHER SIDE AND ALSO PERUSED THE MATERIAL AVAILABLE ON RECORD. WE H AVE ALSO CAREFULLY GONE THROUGH THE PROVISIONS OF SECTION 10(33) OF TH E ACT WHICH READS AS FOLLOWS: 10. IN COMPUTING THE TOTAL INCOME OF A PREVIOUS YE AR OF ANY PERSON, ANY INCOME FALLING WITHIN ANY OF THE FOLLOW ING CLAUSES SHALL NOT BE INCLUDED . (33) ANY INCOME ARISING FROM THE TRANSFER OF A CAPITA L ASSET, BEING A UNIT OF THE UNIT SCHEME, 1964 REFERRED TO IN S CHEDULE ITA NO.299/15 :- 3 -: I TO THE UNIT TRUST OF INDIA (TRANSFER OF UNDERTAKI NG AND REPEAL) ACT, 2002 (58 OF 2002) AND WHERE THE TRANSFER OF SUCH ASSET TAKES PLACE ON OR AFTER THE 1 ST DAY OF APRIL, 2002. 6. IN VIEW OF THE ABOVE, ANY INCOME ARISING FROM TRANS FER OF A CAPITAL ASSET BEING A UNIT OF THE UNIT SCHEME 64 CA NNOT FORM PART OF THE TOTAL INCOME OF THE ASSESSEE. IF THE INCOME C ANNOT FORM PART OF THE INCOME OF THE ASSESSEE, THIS TRIBUNAL IS OF TH E CONSIDERED OPINION THAT THE LOSS ARISES FROM SUCH TRANSFER ALSO CANNOT BE SET OFF AGAINST ANY OTHER INCOME OF THE ASSESSEE. IN VIEW OF THE ABOVE, THIS TRIBUNAL DO NOT FIND ANY INFIRMITY IN THE ORDER OF THE LOWER AUTHORITY AND THE SAME IS CONFIRMED. 7. IN THE RESULT, THE APPEAL OF THE ASSESSEE STANDS DISMISSED. ORDER PRONOUNCED ON 29 TH OF MAY, 2015, AT CHENNAI. SD/- SD/- ( . !' ) (A. MOHAN ALANKAMONY) # / ACCOUNTANT MEMBER ( . . . ' ) (N.R.S. GANESAN) / JUDICIAL MEMBER #$ / CHENNAI %& / DATED: 29 TH MAY, 2015 RD &' ()*) / COPY TO: 1 . / APPELLANT 3. +,' / CIT(A) 5. )-. / / DR 2. / RESPONDENT 4. + / CIT 6. .01 / GF