CAPT. SOMESH CHANDER BATRA, MUMBAI V. ACIT RG 2(3), MUMBAI

ITA 3250/MUM/2010

• Counselvise Citation: 325019914 RSA 2010
• Duration Of Justice: 1 year(s) 1 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-06-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: J
• Next Hearing Date: 23-06-2011
• Assessment Year: 2006-2007
• Appeal Filed On: 26-04-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S K SINGH
• Assessee Lawyers: VIMAL PUNMIYA
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES J, MUMBAI BEFORE SHRI PRAMOD KUMAR, ACCOUNTANT MEMBER AND SHRI V. DURGA RAO, JUDICIAL MEMBER ITA NO. 3250/MUM/2010 ASSESSMENT YEAR 2006-2007 CAPT. SOMESH CHANDER BATRA, C/O. KUCHERIA & ASSOCIATES, 59, JOLLY MAKER NO.2, NARIMAN POINT, MUMBAI 400021. PAN: AABP3376 VS. ASST. COMMISSIONER OF INCOME- TAX, RANGE 2 (3), R.NO.555, 5 TH FLOOR, AYAKAR BHAVAN, MUMBAI 400 021. (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI VIMAL PUNMIYA , A.R. RESPONDENT BY : SHRI S.K. SINGH, D.R. O R D E R PER PRAMOD KUMAR: 1. BY WAY OF THIS APPEAL, THE ASSESSEE APPELLANT H AS CALLED INTO QUESTION CORRECTION OF LD. CIT (A) ORDER DATED 12 TH JANUARY, 2010 IN THE MATTER OF ASSESSMENT U/S 143(3) OF THE INCOME TAX ACT, 1961 F OR THE ASSESSMENT YEAR 2006-2007. GRIEVANCES RAISED BY THE ASSESSEE ARE AS FOLLOWS:- ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASSE AND IN LAW THE LEARNED ASSESSING OFFICER HAS ERRED IN D ISALLOWING MANAGEMENT EXPENSES AGAINST SHORT TERM GAIN OF RS. 10,69,520/- IN VIEW OF THE PROVISION SECTION 48(2) OF THE I.T. ACT, 1961. YOUR APPELLANT PRAY THAT THE ADDITION BE DELETED. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW THE LEARNED ASSESSING OFFICER HAS ERRED IN C ONSIDERING SHORT TERM LOSS OF RS. 5,75,464/- AS SPECULATION LO SS. ITA NO 3250/MUM/2010 A.Y.2006-2007 2 YOUR APPELLANT PRAY THAT THE SAME BE CONSIDERED AS SHORT TERM LOSS. 2. LEARNED REPRESENTATIVES OF THE PARTIES FAIRLY AG REE THAT THE ISSUE IS COVERED BY TRIBUNALS ORDER IN THE CASE OF AVINASH CHANDER BATRA VS. ACIT ITA NO.3249/MUM/2010; ORDER DATED 8 TH APRIL, 2011 & PREM ASSOCIATES ADVERTISING AND MARKETING VS. JCIT IN ITA NO.6547/M UM/2009; ORDER DATED 17 TH SEPTEMBER, 2010, WHEREIN IT IS HELD THAT THE DERIVATIVE TRANSACTIONS ENTERED INTO BY THE ASSESSEE AT THE RE COGNISED STOCK EXCHANGE, EVEN PRIOR TO THE DATE OF NOTIFICATION IN THE RELEV ANT PREVIOUS YEAR, ARE TO BE TREATED AS COVERED BY THE EXCEPTION SET OUT IN SECT ION 43(5)(D). IT IS NOT IN DISPUTE THAT IN CASE THE TRANSACTIONS ARE TO BE TRE ATED AS COVERED BY SECTION 43(5)(D), THE SAME WILL BE TREATED AS BUSINESS LOSS AND ACCORDINGLY ELIGIBLE TO BE SET OF AGAINST SHORT TERM CAPITAL GAINS BY THE A SSESSEE. 3. IN VIEW OF THE ABOVE POSITION AND CONSISTENT WIT H THE STAND TAKEN BY THE COORDINATE BENCHES, WE UPHOLD THE GRIEVANCE OF THE ASSESSEE AND DIRECT THE ASSESSING OFFICER TO TREAT THE LOSSES IN TRANSA CTION OF DERIVATIVES EVEN PRIOR TO THE DATE OF NOTIFICATION IN THE RELEVANT P REVIOUS YEAR AS COVERED BY EXCLUSION CLAUSE IN SECTION 43(5)(D) OF THE ACT. IN OTHER WORDS, THE LOSS SO INCURRED IS TO BE TREATED AS NORMAL BUSINESS LOSS A ND AS LIABLE TO BE SET OF AGAINST SHORT TERM CAPITAL GAINS. THE GRIEVANCE OF THE ASSESSEE IS ACCORDINGLY UPHELD. ITA NO 3250/MUM/2010 A.Y.2006-2007 3 4. IN THE RESULT, THE APPEAL IS ALLOWED FOR STATIST ICAL PURPOSES. PRONOUNCED IN THE OPEN COURT TODAY ON 23 RD JUNE, 2011 IMMEDIATELY UPON CONCLUSION OF HEARING. SD/- SD/- V. DURGA RAO PRAMOD KUMAR JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI, DATED 24 TH JUNE, 2011. OKK* COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. COMMISSIONER OF INCOME TAX (APPEALS)-VI, MUMBAI 4. COMMISSIONER OF INCOME TAX, CONCERNED 5. DEPARTMENTAL REPRESENTATIVE, BENCH J, MUMBAI TRUE COPY BY ORDER ASSISTANT REGISTRAR, MUMBAI