ACIT CIR 4(2), MUMBAI V. S.B. SECURITIES P. LTD, MUMBAI

ITA 488/MUM/2012

• Counselvise Citation: [2013] 120 COUNSELVISE.COM (IT) 1830 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-01-2013
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: E
• Assessment Year: 2008-2009
• Appeal Filed On: 23-01-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAHASHRI DIWEDY
• Section: 115JB; 11

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCH E, MUMBAI BEFORE SHRI I.P.BANSAL,JUDICIAL MEMBER & SHRI N.K.BILLAIYA, ACCOUNTANT MEMBER ITA NO. 488/MUM/12 (A.Y.2008-09) THE ACIT, CIR. 4(2), ROOM NO.642,6 TH FLOOR, AAYKAR BHAVAN, MK ROAD, MUMBAI 400 020. (APPELLANT) VS. M/S. S.B.SECURITIES PVT. LTD., 6-7, RTUNDA BULDING, 2 ND FLOOR, APPOLO STREET, MUMBAI 400 023. PAN: AAECS 6189B (RESPONDENT) APPELLANT BY : SHRI RAHASHRI DIWEDY RESPONDENT BY : NONE DATE OF HEARING : 21/01/2013 DATE OF PRONOUNCEMENT : 3 0/01/2013 ORDER PER I.P.BANSAL, J.M THIS IS AN APPEAL FILED BY THE REVENUE. IT IS DIR ECTED AGAINST THE ORDER PASSED BY LD. CIT(A)-9 MUMBAI DATED 02/11/2011 FOR ASSESSMENT YEAR 2008- 09 THE GROUNDS OF APPEAL RAISED BY THE REVENUE REA D AS UNDER: 1ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD.CIT(A) ERRED IN ALLOWING REBATE U/S.88E FROM THE TAX LIABILITY COMPUTED U/S. 11 5JB WHEN SECTION 11 5JB BEGINS WITH A NON O BSTANTE CLAUSE. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE, THE IMPUGNED ORDER OF THE LD.CIT(A) IS CONTRARY TO LAW TO BE SET ASIDE AND THAT OF THE ASSESSING OFFICER BE RESTORED. 2. THE AO DID NOT ALLOW REBATE UNDER SECTION 88E OF THE INCOME TAX ACT,1961(THE ACT) WHILE COMPUTING TAX UNDER SECTIO N 115JB OF THE ACT. LD. CIT(A) HAS GIVEN THE RELIEF BY FOLLOWING THE DECIS ION OF ITAT BANGALORE IN THE CASE OF M/S. HORIZON CAPITAL LTD. VS. ITO IN ITA NO .592/BNG/2010 FOR ITA NO. 488/MUM/12 (A.Y.2008-09) 2 ASSESSMENT YEAR 2005-06 DATED 16/07/2010. THE LD. CIT(A) HAS ALSO REFERRED TO ANOTHER CASE DECIDED BY HIM VIDE ORDER DATED 2/7 /2010 IN THE CASE OF M/S. NAMAN SECURITIES & FINANCE PVT. LTD. 3. NOTICE OF HEARING WAS SENT TO THE ASSESSEE, HOWE VER, NONE WAS PRESENT. AS IT IS A COVERED ISSUE WE PROCEED TO DECIDE THE P RESENT APPEAL. 4. LD. DR RELIED UPON THE ORDER PASSED BY AO AND CO NTENDED THAT BENEFIT OF SECTION 88E CANNOT BE ALLOWED TO THE ASSESSEE WHILE COMPUTING BOOK PROFIT UNDER SECTION 115JB OF THE ACT. 5. WE HAVE HEARD LD. DR AND WE HAVE CAREFULLY GONE THROUGH THE ASSESSMENT ORDER AS WELL AS ORDER PASSED BY LD. CIT (A). THE ORDER OF LD. CIT(A) IN THE CASE OF M/S. NAMAN SECURITIES FINANCE PVT. LTD. (SUPRA) WAS FURTHER APPEALED BY THE DEPARTMENT BEFORE ITAT MUMBAI AND THE SAME WAS DECIDED VIDE ORDER DATED 10/10/2012 IN ITA NO.6533/MUM/2010 , WHEREIN SIMILAR ISSUE WAS DECIDED IN FAVOUR OF THE ASSESSEE AS IT WAS FOUND TO BE COVERED BY THE DECISION OF HONBLE KARNATAKA HIGH COURT IN THE AFOREMENTIONED CASE OF M/S. HORIZON CAPITAL LTD., WHEREIN THE APPEAL FILED BY THE DEPARTMENT WAS DISMISSED BY THE HONBLE HIGH COURT IN IT APPEAL N O.434 OF 2010 VIDE JUDGMENT DATED 24/10/2011. COPY OF ORDER OF THE TR IBUNAL IS PLACED ON RECORD. THE RELEVANT PORTION IS REPRODUCED AS UND ER: 4. WE HAVE CONSIDERED THE SUBMISSIONS OF LEARNED REPRESENTATIVES OF BOTH THE PARTIES AND ORDERS OF THE AUTHORITIES BELO W. WE OBSERVE THAT IN THE CASE BEFORE US, THE TAX PAYABLE BY ASSESSEE AS PER NORMAL PROVISIONS OF THE ACT, IS NIL AFTER DEDUCTING REBATE U/S. 88E O F THE ACT. ACCORDINGLY, THE INCOME OF THE ASSESSEE WAS ALSO COMPUTED UNDER SECT ION 1I5JB OF THE ACT. THE ASSESSING OFFICER WHILE MAKING THE ASSESSMENT U NDER SECTION 1I5JB OF THE ACT, STATED THAT REBATE UNDER SECTION 88E OF THE ACT IS NOT ALLOWABLE TO THE ASSESSEE WHILE COMPUTATION UNDER SECTION 1 1 5J8 OF THE ACT. HOWEVER, LEARNED CIT(A) DIRECTED THE ASSESSING OFFI CER TO ALLOW THE REBATE UNDER SECTION 88E TO THE ASSESSEE AGAINST THE INCOM E COMPUTED UNDER MAT AS PER PROVISION UNDER SECTION I15JB OF THE ACT . A SIMILAR ISSUE HAS COME UP BEFORE THE HONBLE KARNATAKA HIGH COURT IN THE CASE OF MIS HORIZON CAPITAL LIMITED (SUPRA). THE HONBLE HIGH C OURT WHILE CONFIRMING THE ORDER OF TRIBUNAL IN THE ABOVE CASE, HAS HELD T HAT WHILE COMPUTING THE ITA NO. 488/MUM/12 (A.Y.2008-09) 3 TOTAL INCOME UNDER SECTION 11 5JB OF THE ACT, THE A SSESSEE IS ENTITLED TO CLAIM DEDUCTION OF THE AMOUNT EQUAL TO THE SU PAID BY HIM IN RESPECT OF THE TAXABLE SECURITIES TRANSACTIONS ENTERED INTO IN THE COURSE OF BUSINESS DURING THE PREVIOUS YEAR. SINCE THIS ISSUE IS SQUAR ELY COVERED IN FAVOUR OF THE ASSESSEE BY THE DECISION OF THE HONBLE KARNATA KA HIGH COURT IN THE CASE OF M/S HORIZON CAPITAL LIMITED (SUPRA), WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF THE LEARNED CIT(A). HENCE, WE UPHOL D THE ORDER OF LEARNED CIT(A) AND REJECT THE GROUNDS TAKEN BY THE DEPARTME NT. ACCORDINGLY, AFTER HEARING LD. DR, WE DISMISS THE A PPEAL FILED BY THE REVENUE BEING COVERED BY THE AFOREMENTIONED DECISION. NO C ONTRARY DECISION WAS BROUGHT TO OUR NOTICE. 6. IN THE RESULT, THE APPEAL FILED BY THE REVENUE I S DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THE 30 TH DAY OF JAN.2013 SD/- SD/- (N.K.BILLAIYA ) (I.P.BANSAL) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI, DATED 30 TH JAN.2013 COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT CITY CONCERNED 4. THE CIT(A)- CONCERNED 5. THE D.R E BENCH. (TRUE COPY) BY ORDER ASST. REGISTRAR, I TAT, MUMBAI BENCHES MUMBAI. VM.