AASHNA PAHUJA, MUMBAI V. ACIT CIR 24(1), MUMBAI

ITA 5389/MUM/2009

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 48794 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 7 month(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-05-2011
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Bench Allotted: A
• Assessment Year: 2006-2007
• Appeal Filed On: 24-09-2009
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Assessee Lawyers: RA JESH DWIVEDY
• Keywords: Business income; Opportunity of being heard; Additional evidence

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCH A,MUMBAI BEFORE SHRI R.S. SYAL (AM) & SHRI V. DURGA RAO (J M) I.T.A.NO.5389/MUM/2009 (A.Y. 2006-07) SMT. AASHNA PAHUJA, 208, HEMU CLASSIC, OPP. NEW ERA CINEMA, S.V.ROAD, MALAD (W), MUMBAI-400 064. PAN: ADJPP2580J VS. ADDL. COMMR. OF INCOME-TAX, RANGE 24(1), MUMBAI. APPELLANT RESPONDENT I.T.A.NO.5390/MUM./2009 (A.Y. 2006-07) SHRI HARESH PAHUJA, 208, HEMU CLASSIC, OPP. NEW ERA CINEMA, S.V.ROAD, MALAD (W), MUMBAI-400 064. PAN: AHQPP7525C VS. ASST. COMMR. OF INCOME-TAX, CIR. 24(1), MUMBAI. APPELLANT RESPONDENT APPELLANTS BY MS. ARATI VISSANJI RESPONDENT BY MR. RA JESH DWIVEDY. O R D E R PER R.S. SYAL, AM : THESE TWO APPEALS BY DIFFERENT BUT CONNECTED ASSES SEES RELATE TO ASSTT. YEAR 2006-07. SINCE THE ISSUE RAISED IN BOTH THE AP PEALS IS COMMON, WE ARE, THEREFORE, PROCEEDING TO DISPOSE THEM OF BY THIS C ONSOLIDATED ORDER FOR THE SAKE OF CONVENIENCE. THE PRESENT APPEAL IN THE CASE OF S HRI HARESH PAHUJA IS A RECALLED MATTER INASMUCH AS THE EARLIER EX PARTE OR DER PASSED BY THE TRIBUNAL WAS SUBSEQUENTLY RECALLED VIDE ITS LATER ORDER DATE D 28-01-2011. ITANOS. 5389-5390/M/09 AASHNA & HARESH PAHUJA. 2 2. BRIEFLY STATED, THE FACTS OF THE CASE OF SHRI HA RESH PAHUJA ARE THAT AT THE MATERIAL TIME HE WAS PROPRIETOR OF M/S.GENUINE EXPO RTS, ENGAGED IN TRADING OF LUGGAGE ITEMS & ACCESSORIES. APART FROM THAT, HE WA S PARTNER IN M/S. GENUINE INVESTMENTS AND M/S. MATUSHREE ASSOCIATES. FOR THE YEAR UNDER CONSIDERATION, SALARY AND INTEREST FROM M/S. GENUINE INVESTMENTS W AS SHOWN BESIDES INCOME FROM SPECULATION, SHORT-TERM CAPITAL GAIN AND INCOM E FROM OTHER SOURCES. IN THE RETURN, THE ASSESSEE, INTER ALIA , DECLARED SPECULATION INCOME OF RS.4,05,227/-, SHORT-TERM CAPITAL GAIN OF RS.38,06,141/- AND LONG- TERM CAPITAL GAIN OF RS.63,477/- ON SALE OF SHARES. THE AO, ON APPRECIAT ION OF MATERIAL BEFORE HIM, CAME TO THE CONCLUSION THAT THE ASSESSEE WAS NOT IN VESTOR BUT A TRADER IN SHARES. AS A RESULT OF THAT, THE INCOME SHOWN UNDER THE HE AD CAPITAL GAIN WAS HELD TO BE TAXABLE AS BUSINESS INCOME. NO RELIEF WAS ALLO WED IN THE FIRST APPEAL. 3. THE FACTS OF THE SECOND ASSESSEE, NAMELY, SMT. A ASHNA PAHUJA, ARE MUTATIS MUTANDIS SIMILAR TO THOSE OF SH. HARESH P. PAHUJA, WHO HAP PENS TO BE HER HUSBAND. 4. BEFORE US, THE LD. A.R. PLACED ON RECORD ADDITIO NAL EVIDENCE IN THE SHAPE OF PROFIT & LOSS ACCOUNT, BALANCE-SHEET AND OTHER RELA TED ACCOUNTS TOGETHER WITH COMPUTATION OF INCOME OF M/S. GENUINE INVESTMENTS, A PARTNERSHIP FIRM IN WHICH BOTH THE INSTANT ASSESSEES WERE PARTNERS. IT WAS ST ATED THAT THE SAID FIRM WAS DOING THE BUSINESS OF TRADING IN SHARES, WHEREAS BO TH THE ASSESSEES WERE INVESTORS IN SHARES IN THEIR INDIVIDUAL CAPACITIES. IT WAS SUBMITTED THAT THIS ADDITIONAL EVIDENCE HAS A BEARING ON THE DECISION IN THESE CASES, BEING THE QUESTION WHETHER INCOME FROM SHARES WAS TAXABLE AS CAPITAL GAIN OR BUSINESS INCOME. ON A PERTINENT QUERY, THE LD. A.R. SUBMITT ED THAT THIS ADDITIONAL EVIDENCE COULD NOT BE FILED BEFORE THE AUTHORITIES BELOW AND HENCE REQUESTED THAT ITANOS. 5389-5390/M/09 AASHNA & HARESH PAHUJA. 3 THE SAME BE ADMITTED AND THE MATTER RESTORED TO AO FOR TAKING A FINAL DECISION IN THE LIGHT OF SUCH ADDITIONAL EVIDENCE. 5. NO SERIOUS OBJECTION WAS TAKEN BY THE LD. D.R. 6. IN THE LIGHT OF THE SUBMISSIONS MADE BY BOTH THE SIDES AND THE FACT THAT THE ASSESSEE HAS FILED SOME ADDITIONAL EVIDENCE WHI CH, IN THE OPINION OF THE LD. A.R., HAS RELEVANCE TO THE DECISION IN THE PRESENT APPEALS, WE ARE OF THE CONSIDERED OPINION THAT IT WOULD BE JUST AND FAIR I F THE IMPUGNED ORDERS ARE SET ASIDE AND THE MATTER IS RESTORED TO THE FILE OF AO FOR TAKING A FRESH DECISION AS PER LAW AFTER ALLOWING A REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEES. NEEDLESS TO SAY, THE ASSESSEES WILL BE AT LIBERTY T O LEAD ANY EVIDENCE IN SUPPORT OF THEIR RESPECTIVE CASES. 7. IN THE RESULT, BOTH THE APPEALS ARE ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED ON THE 04TH DAY OF MAY, 2011 . SD/- SD/- (V. DURGA RAO) (R.S. SYAL) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI: 04TH MAY , 2011. NG: COPY TO : 1. ASSESSEES. 2. DEPARTMENT. 3 CIT(A)-XXIV,,MUMBAI. 4 CIT-24,MUMBAI. 5.DR,A BENCH,MUMBAI. 6.MASTER FILE. (TRUE COPY) BY ORDER, ASST.REGISTRAR, ITAT, MUMBAI. ITANOS. 5389-5390/M/09 AASHNA & HARESH PAHUJA. 4 DETAILS DATE INITIALS DESIGN ATION 1. DRAFT DICTATED ON 02-05-11 SR.PS/ 2. DRAFT PLACED BEFORE AUTHOR 02-05-11 SR.PS/ 3. DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER JM/AM 4. DRAFT DISCUSSED/APPROVED BY SECOND MEMBER JM/AM 5. APPROVED DRAFT COMES TO THE SR.PS/PS SR.PS/ 6. KEPT FOR PRONOUNCEMENT ON SR.PS/ 7. FILE SENT TO THE BENCH CLERK SR.PS/ 8. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK 9. DATE ON WHICH FILE GOES TO THE AR 10. DATE OF DISPATCH OF ORDER *