ITO 25(2)(2), MUMBAI V. PRADEEPKUMAR BABAULAL SOLANKI, MUMBAI

ITA 5705/MUM/2013

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 88119 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 4 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-01-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Assessment Year: 2008-2009
• Appeal Filed On: 13-09-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: AKHILENDRA YADAV
• Assessee Lawyers: K SHIVARAM
• Keywords: Transactions in derivatives; Speculation loss
• Section: 43(5)

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL C BE NCH, MUMBAI , !' #$%& , '' ' ( BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER AND SHRI N.K. BILLAIYA, ACCOUNTANT MEMBER ./I .T.A. NO. 5705/MUM/2013 ( ! ! ! ! ) ) ) ) / ASSESSMENT YEAR : 2008-09 THE ITO 25(2)(2), C-11 BLDG., PRATYAKSHKAR BHAVAN, BANDRA KURLA COMPLEX, BANDRA (E), MUMBAI-400,051 ! ! ! ! / VS. SHRI PRADEEPKUMAR BABULAL SOLANKI, SHOP NO.2, SANTOK CHAWAL, MAIN CARTER ROAD, BORIVALI(E), MUMBAI-400,066 * '' ./ + ./ PAN/GIR NO. : AAHPS 7241L ( *, / APPELLANT ) .. ( -.*, / RESPONDENT ) *, / ' / APPELLANT BY: SHRI AKHILENDRA YADAV -.*, 0 / ' / RESPONDENT BY: SHRI K. SHIVARAM ! 0 12' / DATE OF HEARING :22.01.2015 3) 0 12' / DATE OF PRONOUNCEMENT :22.01.2015 '4 / O R D E R PER N.K. BILLAIYA, AM: THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST THE ORDER OF THE LD. CIT(A)-35, MUMBAI DT.18.7.2013 PERTAINING TO A.Y.20 08-09. ITA NO. 5705/M/2013 2 2. THE SOLE GRIEVANCE OF THE REVENUE IS THAT THE LD . CIT(A) ERRED IN ALLOWING SPECULATION LOSS OF RS. 19,39,543/- . 3. BRIEFLY STATED THE FACTS OF THE CASE ARE THAT IN THE FIRST ROUND OF LITIGATION, ASSESSEES CLAIM OF LOSS OF RS. 19,39,5 43/- WAS DENIED BY THE AO VIDE ASSESSMENT ORDER DT. 16.12.2010 MADE U/S. 1 43(3) OF THE ACT. THE MAIN REASON FOR DENYING THE CLAIM OF LOSS WAS T HAT THE ASSESSEE HAD NOT CLAIMED THE SAME IN HIS RETURN OF INCOME, THE S AME WAS CLAIMED IN THE REVISED COMPUTATION OF INCOME WITHOUT FURNISHING SU PPORTING DOCUMENTARY EVIDENCES. THE MATTER TRAVELLED UPTO T HE TRIBUNAL AND THE TRIBUNAL IN ITA NO. 3511/M/2011 RESTORED THE MATTER TO THE FILE OF THE AO TO DECIDE THE ISSUE AFRESH IN THE LIGHT OF THE D OCUMENTS AS MAY BE FILED BY THE ASSESSEE BEFORE HIM. PURSUANT TO THE DIRECTIONS OF THE TRIBUNAL, THE ASSESSEE FILED RELATED DOCUMENTS IN T HE SECOND ROUND OF LITIGATION. HOWEVER, ONCE AGAIN THE AO DENIED THE CLAIM OF LOSS AS THE SAME WAS NOT CLAIMED IN THE ORIGINAL RETURN OF INCO ME. THE AO RELIED UPON THE DECISION OF THE HONBLE SUPREME COURT IN T HE CASE OF GOETZE (INDIA) LTD. VS CIT 284 ITR 323. 4. AGGRIEVED, ASSESSEE CARRIED THE MATTER BEFORE TH E LD. CIT(A). BEFORE THE LD. CIT(A), IT WAS STRONGLY CONTENDED TH AT THE ASSESSEE HAS FILED ALL THE NECESSARY EVIDENCES IN SUPPORT OF THE CLAIM OF THE LOSS OF RS. 19,39,543/-. IT WAS POINTED OUT TO THE LD. CIT(A) THAT THE LOSS FROM FUTURES & OPTIONS IS NOT SPECULATIVE IN NATURE AND CAN BE CLAIMED AS A SET OFF AGAINST INCOME FROM OTHER SOURCES. THE LD. CIT(A) AFTER CONSIDERING THE FACTS AND THE SUBMISSIONS WAS CONVI NCED THAT THE F&O TRANSACTIONS ARE SQUARELY COVERED BY THE PROVISO TO SEC. 43(5) OF THE ACT. THE LD. CIT(A) FURTHER HELD THAT THE RATIO OF THE D ECISION OF THE HONBLE SUPREME COURT IS NOT TO IMPINGE TO THE POWER OF TH E APPELLATE ITA NO. 5705/M/2013 3 AUTHORITIES. AFTER CONSIDERING THE FACTS AND THE S UBMISSIONS, THE LD. CIT(A) ALLOWED THE CLAIM OF LOSS OF RS. 19,39,543/ -. 5. AGGRIEVED BY THIS, REVENUE IS BEFORE US. 6. THE LD. DEPARTMENTAL REPRESENTATIVE STRONGLY SUP PORTED THE ASSESSMENT ORDER. 7. THE LD. COUNSEL FOR THE ASSESSEE REITERATED WHAT HAS BEEN SUBMITTED BEFORE THE LOWER AUTHORITIES. 8. WE HAVE CAREFULLY PERUSED THE ORDERS OF THE AUTH ORITIES BELOW. WE HAVE ALSO THE BENEFIT OF GOING THROUGH THE ORDER O F THE TRIBUNAL IN THE FIRST ROUND OF LITIGATION. IT IS AN UNDISPUTED FAC T THAT IN THE FIRST ROUND OF LITIGATION, THE TRIBUNAL RESTORED THE MATTER TO THE FILE OF THE AO TO DECIDE THE ISSUE AFRESH IN THE LIGHT OF THE DOCUMENTARY EV IDENCES FILED BY THE ASSESSEE IN SUPPORT OF HIS CLAIM OF LOSS OF RS. 19, 39,543/-. IT IS ALSO AN UNDISPUTED FACT THAT IN THE FRESH ASSESSMENT PROCEE DINGS, THE ASSESSEE FILED COMPLETE EVIDENCES IN SUPPORT OF THE CLAIM OF LOSS. IT IS ALSO AN UNDISPUTED FACT THAT THE AO DECLINED TO ALLOW THE C LAIM OF LOSS SIMPLY BECAUSE HE DREW SUPPORT FROM THE DECISION OF THE H ONBLE SUPREME COURT IN THE CASE OF GOETZE (INDIA) LTD (SUPRA). H OWEVER, THE LD. CIT(A) HAS RIGHTLY OBSERVED THAT THE RATIO OF THE DECISIO N OF THE HONBLE SUPREME COURT IN THE CASE OF GOETZE INDIA (SUPRA) D OES NOT IMPINGE THE POWER OF THE APPELLATE AUTHORITIES. THEREFORE, THE LD. CIT(A) HAS RIGHTLY ALLOWED THE CLAIM OF LOSS AS PER PROVISIONS OF THE LAW. WE, THEREFORE, DECLINE TO INTERFERE WITH THE FINDINGS OF THE LD. C IT(A). ITA NO. 5705/M/2013 4 9. IN THE RESULT, THE APPEAL FILED BY THE REVENUE I S DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT AT THE TIME OF H EARING ON 22 ND JANUARY, 2015. SD/- SD/- (JOGINDER SINGH ) (N.K. BILLAIYA) /JUDICIAL MEMBER '' / ACCOUNTANT MEMBER MUMBAI; 5! DATED : 22.01.2015 . ! . ./ RJ , SR. PS '4 '4 '4 '4 0 00 0 -1# -1# -1# -1# 6'#)1 6'#)1 6'#)1 6'#)1 / COPY OF THE ORDER FORWARDED TO : 1. *, / THE APPELLANT 2. -.*, / THE RESPONDENT. 3. 7 ( ) / THE CIT(A)- 4. 7 / CIT 5. #8 -1! , , / DR, ITAT, MUMBAI 6. 9 : / GUARD FILE. '4! '4! '4! '4! / BY ORDER, .#1 -1 //TRUE COPY// ; ;; ; / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI