ITO 25(3)(1), MUMBAI V. MILIND P. PATEL, MUMBAI

ITA 3212/MUM/2017

• Counselvise Citation: [2019] 112 COUNSELVISE.COM (IT) 4722 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 9 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-02-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Assessment Year: 2012-2013
• Appeal Filed On: 03-05-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: D G
• Keywords: Business income; Rule of consistency
• Section: 143(3); 201

Judgement Text

THE INCOME TAX APPELLATE TRIBUNAL D BENCH, MUMBAI BEFORE SHRI RAJESH KUMAR (AM) & SHRI RAMLAL NEGI ( JM) I.T.A. NO. 3212/MUM/2017 (ASSESSMENT YEAR 2012-1 3) ITO - 25(3)(1) 6 TH FLOOR, C-10 PRATYAKSH KAR BHAVAN, BKC BANDRA (E) MUMBAI-400 051. VS . SHRI M ILIND P. PATEL 21-28, GOKUL ARCADE S.N. ROAD, VILE PARLE(WEST) MUMBAI-400 049. PAN : AMNPP4051B ( APPELLANT ) ( RESPONDENT ) ASSESSEE BY SHRI KUMAR KALE DEPARTMENT BY SHRI D.G. PANSARI DATE OF HEARING 12 . 2 . 201 9 DATE OF PRONOUNCEMENT 22 . 2 . 201 9 O R D E R PER RAJESH KUMAR (AM) : THE PRESENT APPEAL HAS BEEN PREFERRED BY THE REVEN UE AGAINST THE ORDER DATED 22.02.2017 OF THE COMMISSIONER OF INCOME TAX (APPEALS) [HEREINAFTER REFERRED TO AS THE CIT(A)] RELEVANT TO ASSESSMENT Y EAR 2012-13. 2. THE ONLY ISSUE RAISED BY THE REVENUE IN VARIOUS GROUNDS OF APPEAL IS AGAINST THE ORDER OF LEARNED CIT(A) IN NOT APPRECIA TING THE FACT THAT INCOME FROM SALE OF SHARES IS BUSINESS INCOME RATHER TH AN SHORT/LONG TERM CAPITAL GAIN AS THE ASSESSEE IS ENGAGED IN THE ACTIVITY OF BUSINESS OF SALE AND PURCHASE OF SHARES/DERIVATIVES. 3. LEARNED AR AT THE OUTSET, SUBMITTED THAT THE ISS UE INVOLVED IN THE PRESENT APPEAL IS COVERED IN FAVOUR OF THE ASSESSEE BY THE DECISION OF THE COORDINATE BENCH IN ASSESSEES OWN CASE IN ITA NO. 4093/MUM/2016 AND OTHERS, WHEREIN THE COORDINATE BENCH FOLLOWING VARI OUS DECISIONS OF HIGH COURTS AND OTHER JURISDICTIONAL FORUMS HELD THAT TH OUGH PRINCIPLES OF RES- JUDICATA IS NOT APPLICABLE IN THE ASSESSMENT PROCEE DINGS YET THERE SHOULD BE CONSISTENCY WHEN THE FACTS ARE IDENTICAL AND THUS DISMISSED THE APPEAL OF THE 2 REVENUE. SINCE IN THE CURRENT YEAR FACTS ARE MATERI ALLY SAME , THE APPEAL OF THE REVENUE MAY BE DISMISSED. 4. ON THE OTHER HAND LEARNED DR RELIED HEAVILY ON T HE ORDER OF THE ASSESSING OFFICER. 5. AFTER HEARING RIVAL SUBMISSIONS, WE FIND THAT IN THE EARLIER YEARS THE SSUE HAS BEEN DECIDED IN FAVOUR OF THE ASSESSEE UNDER SI MILAR SET OF FACTS. IN THE PRESENT CASE, FACTS ARE IDENTICAL TO THE EARLIER YE ARS. RELEVANT OPERATIVE PART OF THE DECISION OF THE COORDINATE BENCH IN ASSESSEES OWN IN A.Y. 20010-11 & 2011-12 ARE AS UNDER : ASSESSING OFFICER HIMSELF ACCEPTED THE CLAIM OF ASS ESSEE UNDER SECTION 143(3) HAVE NOTED THAT THE CLAIM OF ASSESSEE IS CON SISTENTLY ACCEPTED EITHER AT THE ASSESSMENT STAGE OR AT THE STAGE OF F IRST APPEAL BY ID. CIT(A), WHICH IS CONFIRMED BY TRIBUNAL AND ON APPEA L BEFORE HON'BLE JURISDICTIONAL HIGH COURT, THE ORDER OF TRIBUNAL WA S UPHELD. WE HAVE FURTHER NOTED FROM THE CHART FURNISHED BY ID. AR OF THE ASSESSEE FROM A.Y. 2001-02 TO A.Y. 2015-16, AND EXCEPT FOR THE YE AR UNDER CONSIDERATION, THE STATUS OF ASSESSEE IS ACCEPTED I N A.Y. 2001-02, 2002- 03, 2005-06, 2006-07, 2007-08, 2008-09, 2012-13, 20 13-14, 2014-15 AND 2015-16 AT ASSESSMENT STAGE ONLY. FOR A.Y. 2003 -04 AND 2004-05, 2009-10, 2010-11, THE STATUS OF ASSESSEE AS INVESTO R WAS ACCEPTED BY ID. CIT(A), WHICH WAS CONFIRMED BY TRIBUNAL. FURTHE R, THE APPEAL OF REVENUE FOR A.Y. 2003-04 & 2004-05 HAS BEEN DISMISS ED BY HON'BLE BOMBAY HIGH COURT. THEREFORE, KEEPING IN VIEW, THE PRINCIPLE OF CONSISTENCY IN ABSENCE OF CHANGE OF MATERIAL FACT V IS-A-VIS THE FACTS OF THE PREVAILING YEAR UNDER CONSIDERATION, THE REVE NUE SHOULD ACCEPT THE TREATMENT OF CLAIM OF ASSESSEE IN THE SIMILAR W AY AS TREATED IN EARLIER YEARS. 11. THE HON'BLE SUPREME COURT IN RADHA SOAMI SATSAN G VS. CIT [193 ITR 321(SC)] HELD, THAT STRICTLY SPEAKING RES JUDIC ATA DOES NOT APPLY TO INCOME-TAX PROCEEDINGS. EACH ASSESSMENT YEAR BEING A UNIT, WHAT IS DECIDED IN ONE YEAR MAY NOT APPLY IN THE FOLLOWING YEAR BUT WHERE A FUNDAMENTAL ASPECT PERMEATING THROUGH THE DIFFERENT ASSESSMENT YEARS HAS BEEN FOUND AS A FACT ONE WAY OR THE OTHER AND P ARTIES HAVE ALLOWED THAT POSITION TO BE SUSTAINED BY NOT CHALLENGING TH E ORDER, IT WOULD NOT BE AT ALL APPROPRIATE TO ALLOW THE POSITION TO BE C HANGED IN A SUBSEQUENT YEAR. 12.THE HON'BLE BOMBAY HIGH COURT IN CIT VS. GOPAL P UROHIT [336 ITR 287 (BOM)] ALSO HELD THAT RES JUDKATA IS NOT ANNLICABLE TO 3 ASSESSMENT PROCEEDINGS, YET THERE SHOULD BE UNIFORM ITY IN TREATMENT AND CONSISTENCY, WHEN FACTS AND CIRCUMSTANCES ARE I DENTICAL. THEREFORE, IN VIEW OF THE ABOVE FACTUAL AND LEGAL DISCUSSION, WE DO NOT FIND ANY ILLEGALITY OR INFIRMITY IN THE ORDER PASSED BY ID. CIT(A), WHICH WE AFFIRM. SINCE WE HAVE ACCEPTED THE CONTENTION OF ASSESSEE O N THE PRINCIPLE OF CONSISTENCY, THEREFORE, THE DISCUSSION ON THE OTHER CONTENTION OF ASSESSEE HAVE BECOME ACADEMIC. 13.IN THE RESULT, APPEAL OF THE REVENUE IS DISMISSE D. 6. SINCE THERE IS NO CHANGE IN THE FACTS, WE ARE I NCLINED TO FOLLOW THE DECISION OF THE COORDINATE BENCH ON THE ISSUE AND A CCORDINGLY, HOLD THAT INCOME OF THE ASSESSEE FROM SALE AND PURCHASE OF SH ARES IS BUSINESS INCOME AND NOT IN THE NATURE OF CAPITAL GAIN. ACCORDINGLY, WE DISMISS THE GROUNDS RAISED BY THE REVENUE. 7. IN THE RESULT, APPEAL FILED BY THE REVENUE IS DI SMISSED. ORDER HAS BEEN PRONOUNCED IN THE COURT ON 22.2.2019 . SD/- SD/- (RAMLAL NEGI) (RAJESH KUMAR) JUDICIAL MEMBER ACCOUNTANT M EMBER MUMBAI; DATED : 22/2/2019 COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT(A) 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE. BY ORDER, //TRUE COPY// ( (( ( SENIOR PRIVATE SECRETARY) PS ITAT, MUMBAI