ALPHEO ROBERT DIAS, MUMBAI V. ITO RG 19(3)(1), MUMBAI

ITA 523/MUM/2012

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 4504 (ITAT-MUMBAI)
• Duration Of Justice: 3 year(s) 11 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-01-2016
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 11-01-2016
• Assessment Year: 2005-2006
• Appeal Filed On: 24-01-2012
• Result in Favour of: Revenue
• Court: TRIBUNAL

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, MUMBAI BEFORE S/SHRI B.R.BASKARAN , AM AND AMARJIT SINGH , JM ./ I.T.A. NO . 523 / MUM/ 201 2 ( / ASSESSMENT YEA R : 200 5 - 06 ) ALPHEO ROBERT DIAS, 64 - B, GOPAL MANSION, TURNER ROAD, BANDRA (W), MUMBAI - 400050 / VS. INCOME TAX OFFICER 19(3) (1) , PIRAMAL CHAMBERS, LALBAUG, PAREL, MUMBAI - 400012 ( / APPELLANT ) .. ( / RESPONDENT ) ./ ./PAN. : AADPD7461R / APPELLANT BY SHRI RUSHABH MEHTA / RESPONDENT BY SHRI GANESH BARE / DATE OF HEARING : 11.1.20 16 / DATE OF PRONOUNCEMENT: 11. 1.2016 / O R D E R P ER B R BASKARAN,AM: THE ASSESSEE HAS FILED THIS APPEAL CHALLENGING THE ORDER DATED 30.11.2011 PASSED BY LD CIT (A) - 30, MUMBAI AND IT RELATES TO THE ASSESSMENT YEAR 200 5 - 06 . 2. THE ASSESSEE IS AGGRIEVED BY THE DECISION OF LD. CIT( A) IN CONFIRMING THE INCOME OF RS.24,77,202/ - ASSESSED BY THE AO BY REJECTING THE CLAIM OF LONG TERM CAPITAL GAINS (LTCG). 3. WE HEARD THE PARTIES AND PERUSED THE RECORD. THE ASSESSEE DECLARED LTCG OF RS.23,67,467/ - ON SALE OF SHARES OF AIRTILL BIOTEC H. THE ASSESSEE HAD PURCHASED THE SHARES AT RS.1,09,735/ - AND SOLD THEM AT 523/MUM/2012 2 RS.24,77,202/ - . THE AO CONDUCTED INQUIRIES WITH BOMBAY STOCK EXCHANGE, NSDL, BROKERS ETC. AND NOTICED THAT THE SHARES OF AIRTILL BIOTECH WAS NOT REGISTERED WITH BOMBAY STOCK EX CHANGE . THE AO CONFRONTED THESE INFORMATION WITH THE ASSESSEE AND THE ASSESSEE AGREED FOR ASSESSING LTCG OF RS.23,67,467/ - AS INCOME FROM BUSINESS AND ACCORDINGLY FILED REVISED COMPUTATION OF INCOME ALSO. THE AO DID NOT ACCEPT THE SAME AND ACCORDINGLY ASS ESSED THE SALE CONSIDERATION OF RS.24,77,202/ - AS INCOME OF THE ASSESSEE UNDER THE HEAD INCOME FROM OTHER SOURCES. THE LD. CIT ( A) AGREED WITH THE VIEW TAKEN BY THE AO , HOWEVER, HE HELD THAT LTCG OF RS.23,67,467 / - WAS RIGHTLY ASSESSED UNDER THE HEAD IN COME FROM OTHER SOURCES. 4. THE LD. AR PLACED HEAVY RELIANCE ON THE CONTRACT NOTE ISSUED BY THE BROKERS , HOWEVER, HE COULD NOT GIVE ANY CONVINCING EVIDENCE/EXPLANATION WITH REGARD TO THE INQUIRIES CONDUCTED BY THE AO WITH THE BOMBAY STOCK EXCHANGE , NSD L , BROKERS ETC. UNDER THESE SET OF FACTS, WE ARE OF THE VIEW THAT THE ASSESSEES CLAIM OF LTCG WAS RIGHTLY REJECTED BY THE TAX AUTHORITIES. 5. THE LD. AR SUBMITTED THAT THE AO HAS ASSESSED THE ENTIRE CONSIDERATION OF RS.24,77,202 / - AS INCOME OF THE ASSES SEE. THE LD. CIT(A) WHILE CONFIRMING THE SAID ACTION OF THE AO HAS OBSERVED THAT THE AO WAS RIGHT IN ASSESSING THE AMOUNT OF RS.23,67,467/ - UNDER THE HEAD INCOME FROM OTHER SOURCES. THE LD. AR SUBMITTED THAT THE LD.CIT(A) HAS GIVEN DEDUCTION OF COST OF PURCHASES OF SHARES AND ACCORDINGLY HELD THAT THE AMOUNT OF RS.23,67,467/ - IS ASSESSABLE, EVEN THOUGH HE DID NOT MAKE ANY SPECIFIC OBSERVATION ABOUT THE DEDUCTION OF COST OF PURCHASE OF SHARES. THE LD.AR PRAYED THAT THE SPECIFIC DIRECTION FOR DEDUCTIO N OF COST OF PURCHASE OF SHARES MAY BE GIVEN , IF THE ORIGINAL CONTENTION S OF THE ASSESSEE ARE NOT ACCEPTED. 523/MUM/2012 3 6 . ON THE CONTRARY, THE LD. DR SUBMITTED THAT THE CLAIM OF PURCHASE AND SALE OF SHARES HAVE BEEN PROVED TO BE WRONG BY THE AO AND HENCE THERE IS NO REQUIREMENT OF ALLOWING DEDUCTION OF COST OF PURCHASE OF SHARES. 7 . WE NOTICE THAT E VEN THOUGH , THE AO HAS MADE ADDITION OF RS.24,77,202 / - BEING SALE VALUE OF SHARES, THE LD.CIT(A) HAS CONFIRMED THE ADDITION TO THE EXTENT OF RS.23,67,467/ - , BEING THE A MOUNT OF LTCG. AS POINTED OUT BY THE LD.AR, THE LD. CIT(A) APPEARS TO HAVE ALLOWED DEDUCTION TOWARDS THE COST OF PURCHASE OF SHARES WITHOUT MAKING ANY SPECIFIC OBSERVATION. THE ASSESSEE HAS FILED A COPY OF LEDGER ACCOUNT AS AVAILABLE IN THE BOOKS OF BR OKERS, AS PER WHICH THE ASSESSEE HAS PAID THE COST OF PURCHASE OF SHARES BY WAY OF CASH AS WELL AS BY WAY OF ADJUSTMENT OF PROFIT EARNED IN SHARE TRANSACTIONS IN THE EARLIER YEARS. THE LD A.R SUBMITTED THAT THE PROFIT EARNED IN EARLIER YEARS THROUGH SH ARE TRANSACTIONS HAVE BEEN OFFERED TO TAX. HENCE , MONEY RELATING TO COST OF PURCHASE OF SHARES HAS GONE OUT OF HANDS OF THE ASSESSEE AND HENCE, THE N ET CREDIT ENTRY MADE BY THE ASSESSEE I S THE LTCG OF RS. 23,67,467 / - ONLY . ACCORDINGLY, WE ARE OF THE VIEW T HAT THE LD. CIT(A) WAS JUSTIFIED IN CONFIRMING THE ADDITION TO THE EXTENT OF RS.23,67,467/ - . ACCORDINGLY, WE UPHELD HIS ORDER AND DIRECT THE AO TO RESTRICT THE ADDITION TO THE EXTENT CONFIRMED BY THE LD. CIT(A). 8 . IN THE RESULT, THE APPEAL OF THE ASSE SSEE IS TREATED AS DISMISSED. PRONOUNCED ACCORDINGLY ON 11TH JAN UARY , 2016 . 11 TH JANUARY, 2016 SD SD ( AMARJIT SINGH ) ( B.R. BASKARAN) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI: 11TH JANUARY, 201 6 . . . ./ SRL , SR. PS 523/MUM/2012 4 / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT(A) - CONCERNED 4. / CIT CONCERNED 5. , , / DR, ITAT, MUMBAI CONCERN ED 6. / GUARD FILE. / BY ORDER, TRUE COPY (ASSTT. REGISTRAR) , /ITAT, MUMBAI