ACIT Rg. - 7(2), MUMBAI V. M/s. SCINDIA INVESTMENTS P. LTD., MUMBAI

ITA 4748/MUM/2006

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 49427 (ITAT-MUMBAI)
• Duration Of Justice: 4 year(s) 10 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-07-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: J
• Next Hearing Date: 21-06-2011
• Assessment Year: 2001-2002
• Appeal Filed On: 29-08-2006
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: J D MISTRYMR K K VED
• Keywords: Capital asset; Depreciation; Cost of acquisition
• Section: 234B; 14A

Judgement Text

1 ITA NO. 9284/MUM/2004 (ASST YEAR 2001-02) 2287/MUM/2006 (ASST YEAR 2001-02 ) & 4748/MUM/2006 (ASST YEAR 2001-02) IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI J BENCH MUMBAI BENCHES, MUMBAI BEFORE SHRI PRAMOD KUMAR, AM & SHRI VIJAY PAL RAO , JM ITA NO. 9284/MUM/2004 (ASST YEAR 2001-02) SCINDIA INVESTMENTS P LTD B-431 PHOENIX HOUSE 462 SENAPATI BAAT MARG LOWER PAREL MUMBAI 400 013 VS THE DYCOMMR OF INCOME TAX RANGE 7(2), MUMBAI (APPELLANT) (RESPONDENT) PAN NO.AAACS8590C ITA NO. 2287/MUM/2006 (ASST YEAR 2001-02 ) & ITA NO. 4748/MUM/2006 (ASST YEAR 2001-02) THE DYCOMMR OF INCOME TAX RANGE 7(2), MUMBAI VS SCINDIA INVESTMENTS P LTD B-431 PHOENIX HOUSE 462 SENAPATI BAAT MARG LOWER PAREL MUMBAI 400 013 (APPELLANT) (RESPONDENT) A SSESSEE BY SHRI J D MISTRY/MR K K VED REVENUE BY SHRI S K SINGH PER VIJAY PAL RAO, JM THE APPEAL IN ITA NO.9284/M/09 BY THE ASSESSEE IS D IRECTED AGAINST THE ORDER DATED 1.11.2004 OF THE CIT(A) FOR THE AY 2001-02. 2 THE ASSESSEE HAS RAISED THE FOLLOWING EFFECTIVE G ROUNDS IN THIS APPEAL: 1 ) THE CIT(A) HAS ERRED IN CONFIRMING THE VIEW OF THE ASSESSING OFFICER THAT THE BUNGALOW AT NEW FRIENDS COLONY, DELHI WAS A BUSINESS ASSET AND IN THEREBY NOT CONSIDERING THE LOSS ON SALE OF TH E SAME AS A LONG TERM CAPITAL LOSS. 2 ITA NO. 9284/MUM/2004 (ASST YEAR 2001-02) 2287/MUM/2006 (ASST YEAR 2001-02 ) & 4748/MUM/2006 (ASST YEAR 2001-02) 2) THE CIT(A) HAS ERRED IN HOLDING THAT THE APPELLA NT IS NOT ENTITLED TO CLAIM INDEXATION OF THE REGISTRATION CHARGES PAID FOR RE GISTRATION OF THE PURCHASE DOCUMENTS OF ITS PROPERTY AT USHANT LOK, DE LHI. 3) THE CIT(A) HAS ERRED IN CONFIRMING THE VIEW OF TH E ASSESSING OFFICER THAT STAFF TRAINING EXPENSES OF RS.32,30,590/- INCU RRED BY THE APPELLANT WERE NOT DEDUCTIBLE WHILE COMPUTING ITS TOTAL INCOME . 4) THE CIT(A) HAS ERRED IN CONFIRMING THE VIEW OF TH E ASSESSING OFFICER THAT AN EXPENDITURE OF RS. 23,236/- WAS INCURRED BY THE APPELLANT IN EARNING INCOME BY WAY OF TAX FREE DIVIDENDS AND HENCE DISALLOWABLE U/S 14A AS AGAINST A SUM OF RS.4647/- SUO-MOTO DISA LLOWED BY THE APPELLANT WHILE ARRIVING AT ITS TOTAL INCOME FOR THE YEAR. 5. THE CIT(A) HAS ERRED IN UPHOLDING THE LEVY OF INT EREST U/S 234B OF THE I T ACT, 1961. 6. THE CIT(A) HAS ERRED IN UPHOLDING THE LEVY OF INT EREST U/S 234D OF THE I T ACT, 1961. 3 GROUND NO.1 REGARDING THE DISALLOWANCE OF LONG TE RM CAPITAL LOSS AND TREATING THE BUNGALOW AT NEW FRIENDS COLONY, DELHI WAS A BUSINESS ASSET. 3.1 THE ASSESSEE CLAIMED LONG TERM CAPITAL LOSS (LT CL) ON SALE OF THE BUNGALOW AT NEW FRIENDS COLONY, DELHI. THE ASSESSING OFFICER HELD THAT THE LOSS ON SALE OF THE BUNGALOW IS NOT LTCL BECAUSE THE ASSESSEE HAS NEVE R SHOWN THIS PROPERTY AS LONG TERM INVESTMENT IN THE BALANCE SHEET AND THE INCOME FROM THE BUNGALOW HAS NOT BEEN SHOWN AS INCOME FROM HOUSE PROPERTY. 3.2 ON APPEAL, BEFORE THE CIT(A), THE ASSESSEE CONT ENDED THAT THE BUNGALOW WAS NOT A BUSINESS ASSET AND THE ASSESSEE HAS NEVE R CLAIMED ANY DEPRECATION ON THE SAME. THEREFORE, THE LOSS ON SALE OF THE BUNGAL OW SHOULD BE ALLOWED AS LTCL AFTER CONSIDERING THE INDEXATION OF THE COST OF ACQ UISITION. THE CIT(A) HAS CONFIRMED THE DISALLOWANCE MADE BY THE ASSESSING OFFICER AND HELD THAT WHEN THE ASSESSEE TREATED THE BUNGALOW AS BUSINESS ASSET AFTER THE I NTRODUCTION OF THE CONCEPT OF THE BLOCK OF ASSETS THERE IS NO PROVISION FOR COMPUTING THE CAPITAL LOSS, IN THE EVENT OF THE SALE OF DEPRECIABLE ASSET UNLESS THE ENTIRE BLOCK OF ASSETS IS WIPED OUT. 3 ITA NO. 9284/MUM/2004 (ASST YEAR 2001-02) 2287/MUM/2006 (ASST YEAR 2001-02 ) & 4748/MUM/2006 (ASST YEAR 2001-02) 4 BEFORE US, THE SR COUNSEL FOR THE ASSESSEE HAS SU BMITTED THAT THE ASSESSEE HAS NEVER CLAIMED ANY DEPRECIATION AND NO DEPRECIATION HAS EVER ALLOWED ON THE BUNGALOW IN QUESTION. THEREFORE, WHEN NO DEPRECIATI ON EITHER CLAIMED OR ALLOWED, THEN, THE PROVISIONS OF SEC 50 CANNOT BE APPLIED. H E HAS FURTHER CONTENDED THAT THE ISSUE IS COVERED IN FAVOUR OF THE ASSESSEE BY T HE DECISION OF THE CO-ORDINATE BENCH OF THE TRIBUNAL IN THE CASE OF M/S DIVINE CO NSTRUCTION COMPANY VS ACIT IN ITA NO.5396/MUM/2009 DATED 20.12.2010. 4.1 ON THE OTHER HAND, LD DR, HAS SUBMITTED THAT TH E ASSESSEE HIMSELF HAS TREATED THE ABOVE BUNGALOW AS BUSINESS ASSET AND HAS NEVER SHOWN AS INVESTMENT. HE HAS FURTHER CONTENDED THAT THE ASSESSEE WAS NEVER ADMIT TED ANY RENT INCOME FROM THE BUNGALOW AND THE SAME WAS SHOWN AS BUSINESS ASSET I N ALL THE RECORDS EVEN IN THE MUNICIPAL RECORDS FOR THE PURPOSE OF HOUSE PROPERTY TAX. THEREFORE, THE LOWER AUTHORITIES HAVE JUSTIFIED IN TREATING THE BUNGALOW AS BUSINESS ASSET AND DISALLOWING THE CLAIM OF LTCL. 5 WE HAVE CONSIDERED THE RIVAL CONTENTION AND PERUS ED THE RELEVANT MATERIAL ON RECORD. IT IS AN UNDISPUTED FACT THAT NEITHER TH E ASSESSEE EVER CLAIMED ANY DEPRECIATION ON THE SAID BUNGALOW NOR IT WAS ALLOWE D BY THE DEPARTMENT. AT THE OUTSET, WE FIND THAT A SIMILAR ISSUE WAS CONSIDERED AND ADJUDICATED BY THE CO-ORDINATE BENCH OF THE TRIBUNAL IN THE CASE OF M /S DIVINE CONSTRUCTION COMPANY (SUPRA) AND ONE OF US JUDICIAL MEMBER IS THE PAR TY TO THE SAID ORDER. THE TRIBUNAL IN PARA 4 HAVE DECIDED THE ISSUE AS UNDER: 4. ON GOING THROUGH THE MANDATE OF THIS SECTION IT CAN BE EASILY NOTICED THAT IN ORDER TO TREAT CAPITAL GAIN ARISING FROM THE T RANSFER OF CAPITAL ASSETS IN 4 ITA NO. 9284/MUM/2004 (ASST YEAR 2001-02) 2287/MUM/2006 (ASST YEAR 2001-02 ) & 4748/MUM/2006 (ASST YEAR 2001-02) THE CIRCUMSTANCES MENTIONED IN THE SECTION AS SHORT T ERM CAPITAL GAIN, IT IS NECESSARY THAT THE CONDITIONS MENTIONED IN THE OPENI NG LINES OF SECTION 50 BE FULFILLED VIZ. (I) THE CAPITAL ASSET SHOULD BE AN A SSET FORMING PART OF BLOCK OF ASSET AND (II) DEPRECIATION SHOULD HAVE BEEN ALLOWE D ON IT UNDER THIS ACT OR UNDER THE INDIAN INCOME TAX ACT, 1922. IT IS ONLY ON THE FULFILLMENT OF THESE TWIN CONDITIONS THAT THE PRESCRIPTION OF SECTION 50 GETS ACTIVATED. ADVERTING TO THE FACTS OF THE INSTANT CASE IT IS NOTED THAT THE ASSE SSEE INCLUDED THE PROPERTY IN ITS SCHEDULE OF FIXED ASSETS FOR THIS YEAR AT RS.8,91 ,460. NO DEPRECIATION WAS CLAIMED IN THIS YEAR. WE ARE IN AGREEMENT WITH THE LD . DR THAT MERELY NOT CLAIMING DEPRECIATION IN ONE YEAR IS NOT SUFFICIENT TO PUSH A CASE OUT OF THE PURVIEW OF SECTION 50. IT IS NECESSARY THAT THE DEPRE CIATION SHOULD HAVE NEVER BEEN ALLOWED ON SUCH CAPITAL ASSET. THE LEARNED A.R. WAS DIRECTED TO FILE PURCHASE DEED OF THIS PREMISES IN 1999 AND SUBSEQUENT BALANCE SHEETS. TODAY SUCH DETAILS HAVE BEEN PLACED ON RECORD. IT CA N BE NOTICED THAT THE VALUE OF THIS PROPERTY AS APPEARING IN THE BALANCE SHEET FOR ASSESSMENT YEAR UNDER CONSIDERATION AT RS.8,91,460 CONTINUES TO REMAI N THE SAME SINCE ITS PURCHASE IN 1999. IT SHOWS THAT NO DEPRECIATION WAS E VER CLAIMED OR ALLOWED ON THIS PROPERTY. IN THAT VIEW OF THE MATTER THE PROV ISIONS OF SECTION 50 CANNOT BE APPLIED. WE, THEREFORE, OVERTURN THE IMPUGNED ORD ER ON THIS ISSUE AND HOLD THAT THE LONG TERM CAPITAL GAIN DECLARED BY THE ASSESSEE BE ACCEPTED AS SUCH, SINCE NO INFIRMITY WAS POINTED OUT BY THE A SSESSING OFFICER IN THE CALCULATION SHOWN BY THE ASSESSEE. 6 IN ORDER TO MAINTAIN THE CONSISTENCY, WE DECIDE T HIS ISSUE IN FAVOUR OF THE ASSESSEE AND AGAINST THE REVENUE. 7 NEXT ISSUE REGARDING THE CLAIM OF INDEXATION OF T HE REGISTRATION CHARGES PAID FOR REGISTRATION PURPOSES. 7.1 DURING THE YEAR THE ASSESSEE SOLD ITS PROPERTY AT SUSHANTLOK. THE SAID PROPERTY WAS ACQUIRED ON 1.11.1989 FOR A SUM OF RS. 6.25 LA CS. THE ASSESSEE PAID A SUM OF RS.1,02,125/- AS REGISTRATION CHARGES DURING THE F INANCIAL YEAR RELEVANT TO ASSESSMENT YEAR UNDER CONSIDERATION. THE ASSESSING OFFICER HE LD THAT THE REGISTRATION CHARGES WERE NOT PART OF COST OF THE PROPERTY WHILE COMPUTI NG THE LTCG. 7.2 ON APPEAL, THE CIT(A) THOUGH ACCEPTED THE CLAIM OF THE ASSESSEE FOR THE REGISTRATION CHARGES AS PART OF THE COST OF ACQUISI TION OF THE PROPERTY; HOWEVER, THE 5 ITA NO. 9284/MUM/2004 (ASST YEAR 2001-02) 2287/MUM/2006 (ASST YEAR 2001-02 ) & 4748/MUM/2006 (ASST YEAR 2001-02) COST OF INDEXATION OF RS. 1,02,125/- ON ACCOUNT OF REGISTRATION WAS DENIED. THE CIT(A) HAS OBSERVED THAT THESE CHARGES WERE PAID IN THE FINANCIAL YEAR RELEVANT TO THE ASSESSMENT YEAR UNDER CONSIDERATION; THEREFORE, THE ASSESSEE IS NOT ENTITLED FOR THE INDEXATION. 8 THE SR COUNSEL FOR THE ASSESSEE CONTENDED THAT TH E REGISTRATION CHARGE IS PART AND PARCEL OF THE COST OF ACQUISITION OF THE PROPER TY AND THE COST OF ACQUISITION NEEDS TO BE INDEXED WHILE COMPUTING THE CAPITAL GAI N. THEREFORE, REGISTRATION CHARGES SHOULD BE CONSIDERED FOR GIVING BENEFIT OF THE INDEXATION FOR THE PURPOSE OF COMPUTATION OF CAPITAL GAIN. HE HAS RELIED UPON TH E DECISION OF THE TRIBUNAL IN THE CASE OF SMT LATA G ROHRA VS DCIT REPORTED IN 21 SOT 541 (MUM) AND IN THE CASE OF CHARNBIR SINGH JOLLY REPORTED IN 5 SOT 89 (MUM). 8.1 `ON THE OTHER HAND, THE LD DR HAS SUBMITTED THA T WHEN THE ASSESSEE HAS INCURRED THE EXPENDITURE FOR THE PURPOSE OF REGISTR ATION ONLY DURING THE YEAR UNDER CONSIDERATION THEN, THE SAME CANNOT BE INCLUDED FO R THE PURPOSE OF INDEXATION. HE HAS SUPPORTED THE ORDERS OF THE AUTHORITIES BELOW. 9 WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PERU SED THE RELEVANT MATERIAL ON RECORD. THE COST OF REGISTRATION CHARGES IS NOT A PART OF PURCHASE CONSIDERATION AS AGREED BETWEEN THE PARTIES AT THE TIME OF PURCHASE OF THE PROPERTY. THOUGH, THE REGISTRATION CHARGES INCURRED BY THE ASSESSEE COULD BE INCLUDED IN THE COST OF ACQUISITION OF THE PROPERTY; BUT THE SAID CANNOT BE MERGED INTO THE PURCHASE CONSIDERATION OF THE PROPERTY. 6 ITA NO. 9284/MUM/2004 (ASST YEAR 2001-02) 2287/MUM/2006 (ASST YEAR 2001-02 ) & 4748/MUM/2006 (ASST YEAR 2001-02) 9.1 IN THE CASE OF CHARAN SINGH JOLLY (SUPRA), THE ISSUE BEFORE THE TRIBUNAL WAS THE INDEXATION COST OF ACQUISITION OF THE PROPERTY AT T HE TIME OF FIRST INSTALMENT OR THE TOTAL AMOUNT PAID BY THE ASSESSEE FOR ACQUIRING THE SAID PROPERTY. 9.2 THE ISSUE IN THE CASE OF SMT LATA G ROHRA (SUPR A), AGAIN WAS THE TIME OF INDEXATION OF COST OF ACQUISITION WHETHER AT THE TIME WHEN THE PROPERTY WAS PURCHASED OR IN THE YEAR WHEN IT WAS REGISTERED IN THE NAME OF THE ASSESSEE. 10 IN THE CASE IN HAND, THE ISSUE IS NOT THE PAYMEN T TOWARDS THE PURCHASE OF THE PROPERTY BUT THE EXPENDITURE IS IN THE NATURE OF RE GISTRATION OF THE PROPERTY AND THE INDEXATION COST OF THE SAID EXPENDITURE WILL BE ON THE BASIS OF COST INFLATION INFLUENCED FOR THE YEAR IN WHICH SUCH EXPENDITURE I S INCURRED. THE REGISTRATION CHARGES WERE NOT THE COST TOWARDS ACQUISITION OF TH E PROPERTY AS AGREED BETWEEN THE PARTIES; BUT THESE CHARGES ARE INCURRED FOR THE BETTER TITLE OF THE PROPERTY. THE TRANSACTION OF PURCHASE/TRANSFER OF THE PROPERTY IN THE NAME OF THE ASSESSEE WAS DEEMED TO BE COMPLETED WHEN THE ASSESSEE PURCHASED IN THE YEAR 1989. THE REGISTRATION OF THE SAID PROPERTY DOES NOT CHANGE T HE STATUS OF THE PROPERTY IN THE HANDS OF THE ASSESSEE AND DOES NOT RELATE TO THE CO ST OF PURCHASE OF THE PROPERTY IN THE YEAR 1989. THE REGISTRATION CHARGES ARE THEREF ORE, INCURRED FOR THE BETTER TITLE OF THE SAME RIGHTS AND INTEREST IN THE PROPERTY; BUT D O NOT GIVE ANY NEW RIGHT OR TITLE OR TRANSFER OF ANY RIGHT OF PROPERTY, WHICH WAS PURCHA SED IN THE YEAR 1989. EVEN OTHERWISE, THE BENEFIT OF INDEXATION COST OF ACQUIS ITION OR IMPROVEMENT CHARGES IS BASED ON THE PRINCIPLE OF OFF-SETTING INFLATION EFF ECT. THE REGISTRATION CHARGES WERE NOT ACCRUED OR DETERMINED IN THE YEAR OF PURCHASE O F PROPERTY. THERE IS NO CHANGE IN THE PURCHASE VALUE OF THE MONEY AS THE ASSESSEE INCURRED THE REGISTRATION CHARGES 7 ITA NO. 9284/MUM/2004 (ASST YEAR 2001-02) 2287/MUM/2006 (ASST YEAR 2001-02 ) & 4748/MUM/2006 (ASST YEAR 2001-02) DURING THE YEAR UNDER CONSIDERATION AND THEREFORE, THE BENEFIT OF INDEXATION COST CANNOT BE ALLOWED FROM ANTE DATE OF PURCHASE IN THE YEAR 1989. 10.1 IN VIEW OF THE ABOVE DISCUSSION, WE ARE OF THE CONSIDERED OPINION THAT THE DECISION RELIED UPON BY THE ASSESSEE ARE NOT APPLIC ABLE TO THE FACTS OF THE PRESENT CASE AND ACCORDINGLY, WE DO NOT FIND ANY ERROR OR I LLEGALITY IN THE ORDER OF THE LD CIT(A) TO THE EXTENT OF NOT ALLOWING INDEXATION OR REGISTRATION CHARGES. 11 NEXT ISSUE REGARDING THE DISALLOWANCE OF STAFF T RAINING EXPENSES. 11.1 WE HAVE HEARD THE SR COUNSEL FOR THE ASSESSEE AS WELL AS THE LD DR AND CONSIDERED THE RELEVANT MATERIAL ON RECORD. 12 AT THE OUTSET, WE FIND THIS ISSUE IS COVERED BY THE DECISION OF THE TRIBUNAL IN THE CASE OF THE ASSESSEE IN ITA NO. 3759/MUM/2006 FOR THE ASSESSMENT YEAR 2000-01 VIDE ORDER DATED 13.5.2009. THE TRIBUNAL FOR THE A SSESSMENT YEAR 2000-01 ALLOWED THE CLAIM OF THE ASSESSEE REGARDING THE STAFF TRAIN ING EXPENSES. ACCORDINGLY, FOLLOWING THE ORDER OF THE TRIBUNAL FOR THE EARLIER YEAR, WE ALLOW THE CLAIM OF THE ASSESSEE FOR THE YEAR UNDER CONSIDERATION ALSO. 13 NEXT ISSUE REGARDING DISALLOWANCE U/S 14A. 14 AT THE TIME OF HEARING, THE SR COUNSEL FOR THE A SSESSEE HAS STATED THAT THE ASSESSEE DOES NOT PRESS THIS ISSUE AND MAY BE DISM ISSED AS NOT PRESSED. THE LD DR HAS NO OBJECTION, IF THE GROUND IS DISMISSED AS NOT PRESSED. ACCORDINGLY, WE DISMISS THIS GROUND OF THE ASSESSEE BEING NOT PRESSED. 15 NEXT ISSUE REGARDING LEVY OF INTEREST U/S 234B. 8 ITA NO. 9284/MUM/2004 (ASST YEAR 2001-02) 2287/MUM/2006 (ASST YEAR 2001-02 ) & 4748/MUM/2006 (ASST YEAR 2001-02) 16 THE LEVY OF INTEREST U/S 234B BEING CONSEQUENTIA L ISSUE; THEREFORE, IT DOES NOT REQUIRE ANY ADJUDICATION AND THE ASSESSING OFFICER IS DIRECTED TO COMPUTE THE INTEREST AS PER THE OUTCOME OF THE OTHER ISSUES. 17 NEXT ISSUE RELATES TO INTEREST U/S 234D. 18 WE HAVE HEARD THE SR COUNSEL FOR THE ASSESSEE A ND THE LD DR AND CONSIDERED THE RELEVANT MATERIAL ON RECORD. IN VIEW OF THE DE CISION OF THE JURISDICTIONAL HIGH COURT IN THE CASE OF CIT VS BAJAJ HINDUSTAN LTD I N ITA NO.198 OF 2009 DT 15.4.209 AS WELL AS THE DECISION OF THE SPECIAL BENCH OF THE TR IBUNAL IN THE CASE OF ITO VS EKTA PROMOTERS P LTD REPORTED IN 113 ITD 719(SB) DELHI, INTEREST U/S 234D CANNOT BE LEVIED RETROSPECTIVE. ACCORDINGLY, THIS ISSUE IS DECIDED IN FAVOUR OF THE ASSESSEE. ITA NO.2287/MUM/2006 ( BY THE REVENUE) 19 THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST T HE ORDER DATED 13.12.2005 OF THE CIT(A) FOR THE ASSESSMENT YEAR 2001-02 . 20 WHILE PASSING THE ORIGINAL ORDER DATED 1.11.2 004, THE CIT(A) HAS DISALLOWED THE CLAIM OF THE ASSESSEE REGARDING THE LONG TERM C APITAL LOSS IN RESPECT OF THE BUNGALOW AT NEW FRIENDS COLONY, DELHI. THE ASSESSE E SUBSEQUENTLY FILED A PETITION/APPLICATION ON WHICH THE CIT(A) HAS PASSED THE IMPUGNED ORDER DATED 13.12.2005 AND DIRECTED THE ASSESSING OFFICER TO CO MPUTE THE DEEMED SHORT TERM CAPITAL LOSS. THUS, IN THE REVENUES APPEAL, THE I SSUE RAISED IS A CONSEQUENTIAL ISSUE AS INVOLVED IN THE APPEAL OF THE ASSESSEE AGAINST T HE ORIGINAL ORDER OF THE CIT(A. SINCE WE HAVE DECIDED THE ISSUE OF LONG TERM CAPITA L LOSS IN FAVOUR OF THE ASSESSEE; THEREFORE, THE CONSEQUENTIAL ISSUE IN THE APPEAL OF THE REVENUE HAS BECOME INFRUCTUOUS AND THE SAME IS DISMISSED. 9 ITA NO. 9284/MUM/2004 (ASST YEAR 2001-02) 2287/MUM/2006 (ASST YEAR 2001-02 ) & 4748/MUM/2006 (ASST YEAR 2001-02) ITA NO.4748/MUM/2006( BY THE REVENUE) 21 THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST T HE ORDER DATED 29.6.2006 OF THE CIT(A ARISING FROM THE PENALTY ORDER U/S 271(1) ( OF THE I T ACT. 22 WE HAVE HEARD THE LD DR AND THE SR COUNSEL FOR T HE ASSESSEE AND PERUSED THE RELEVANT MATERIAL ON RECORD. IN THE QUANTUM APPEA L OF THE ASSESSEE, WE HAVE ALLOWED THE CLAIM OF THE ASSESSEE REGARDING THE CAP ITAL LOSS AS WELL AS STAFF TRAINING EXPENSES. THEREFORE, THE PENALTY LEVIED TO THE EX TENT OF ADDITION/DISALLOWANCE IN RESPECT OF LONG TERM CAPITAL LOSS AND STAFF TRAININ G EXPENSES DOES NOT SURVIVE IN VIEW OF OUR ORDER IN QUANTUM APPEAL. 23 IN THE RESULT, THE APPEAL OF THE ASSESSEE IS PAR TLY ALLOWED WHEREAS THE APPEALS OF THE REVENUE ARE DISMISSED. ORDER PRONOUNCED ON THE 6 TH JULY 2011. SD/- SD/- ( PRAMOD KUMAR ) ACCOUNTANT MEMBER ( VIJAY PAL RAO ) JUDICIAL MEMBER PLACE: MUMBAI : DATED: 6 TH JULY 2011 RAJ* COPY FORWARDED TO: 1 APPELLANT 2 RESPONDENT 3 CIT 4 CIT(A) 5 DR /TRUE COPY/ BY ORDER DY /AR, ITAT, MUMBAI