DCIT, New Delhi V. M/s. Dynamic Consultant Pvt. Ltd., New Delhi

ITA 5882/DEL/2011

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 58766 (ITAT-DELHI)
• Duration Of Justice: 2 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-03-2012
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 05-03-2012
• Assessment Year: 2006-2007
• Appeal Filed On: 30-12-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: V RAJ KUMAR S
• Keywords: Business income
• Section: 14A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH : B : NEW DELHI BEFORE SHRI I.P. BANSAL, JUDICIAL MEMBER AND SHRI B.C. MEENA, ACCOUNTANT MEMBER ITA NO.5882/DEL/2011 ASSESSMENT YEAR : 2006-07 DCIT, CIRCLE 10 (1), NEW DELHI. VS. M/S DYNAMIC CONSULTANT PVT. LTD., U-2, GREEN PARK MAIN, NEW DELHI. PAN : AAACD0042L (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI K. SAMPATH & SHRI V. RAJ KUMAR, ADVOCATES REVENUE BY : SHRI ANOOP KUMAR SINHA, SR. DR PER I.P. BANSAL, JUDICIAL MEMBER THIS IS AN APPEAL FILED BY THE REVENUE. IT IS DIRECT ED AGAINST THE ORDER PASSED BY THE CIT (A) DATED 25 TH OCTOBER, 2011 FOR ASSESSMENT YEAR 2006-07. 2. IN THE RETURN OF INCOME THE ASSESSEE HAD SHOWN LONG-T ERM CAPITAL GAIN AT ` 27,38,938/- [CLAIM EXEMPTED U/S 10 (38)] AND THE TAX WAS PAID ON THAT AS PER THE PROVISIONS OF SECTION 111A. THE ASSESSING OFFICER TREATED THE SAME AS BUSINESS INCOME AND DID NOT GIVE THE BENEFIT OF TAX PAYMENT AS PER SECTION 111A AND, THUS, EXEMPTION WAS NOT ALLOWED U/S 10(38). THE SECOND ADDITION UPON WHI CH THE PENALTY HAS BEEN IMPOSED IS ESTIMATED DISALLOWANCE IN RESPECT OF DIVIDEND INCOME OF ` 98,550/- WHICH WAS TREATED TO BE EXEMPT. THE ASSESSING OFFICER REFERRING TO THE PROVISIONS OF SECTION 14A DI SALLOWED A SUM OF ` ITA NO.93/DEL/2010 2 20,000/- ON ESTIMATE BASIS. BOTH THE AFOREMENTIONED A DDITIONS WERE CONSIDERED BY THE TRIBUNAL IN QUANTUM APPEAL VIDE IT S ORDER DATED 30 TH SEPTEMBER, 2011 IN ITA NO.2694/DEL/2009 (ASSESSEES APPE AL) AND ITA NO.3317/DEL/2009 (DEPARTMENTAL APPEAL) AND THE FIND INGS OF THE TRIBUNAL ON THE MAIN ISSUE IS CONTAINED IN PARA 10 WHE REIN IT HAS BEEN HELD THAT PROFIT ARISING ON SALE OF SHARES HELD AS INVEST MENT WAS ASSESSABLE AS CAPITAL GAIN DEPENDING UPON THE PERIOD OF HOLDING AS LONG-TERM OR SHORT-TERM CAPITAL GAIN AND, THUS, THE I SSUE WAS DECIDED IN FAVOUR OF THE ASSESSEE. SO AS IT RELATES TO DISALLOWAN CE U/S 14A, THE ISSUE WAS RESTORED BACK TO THE FILE OF ASSESSING OFFICER WI TH A DIRECTION TO DECIDE THE SAME IN ACCORDANCE WITH THE DECISION OF HONBLE BOMBAY HIGH COURT IN THE CASE OF GODREJ & BOYCE MANUFACTURI NG MFG. CO. LTD. VS. DCIT 194 TAXMAN 203. 3. THE LEARNED DR RELYING UPON THE ORDER OF ASSESSING O FFICER PLEADED THAT THE PENALTY WAS RIGHTLY IMPOSED BY THE A SSESSING OFFICER AND CIT (A) HAS WRONGLY DELETED THE SAME. 4. ON THE OTHER HAND, REFERRING TO THE AFOREMENTION ED ORDER OF THE TRIBUNAL IN QUANTUM PROCEEDINGS IT WAS PLEADED BY THE LEARNED AR THAT THE ADDITIONS DO NOT CONSTITUTE CONCEALMENT IN THE HA NDS OF THE ASSESSEE AND, THEREFORE, LEARNED CIT (A) HAS RIGHTLY DEL ETED THE PENALTY AND HIS ORDER SHOULD BE UPHELD. 5. WE HAVE CAREFULLY CONSIDERED THE RIVAL SUBMISSIONS IN THE LIGHT OF THE MATERIAL PLACED BEFORE US. THE COPY OF THE AFO REMENTIONED ORDER OF THE TRIBUNAL HAS BEEN PLACED ON OUR RECORD. THE MAIN ISSUE HAS BEEN DECIDED IN FAVOUR OF THE ASSESSEE BY THE AFOREMENT IONED ORDER OF THE TRIBUNAL AND ON THE ESTIMATED DISALLOWANCES THE MA TTER HAS BEEN RESTORED BACK TO THE FILE OF ASSESSING OFFICER. KEEPING IN VIEW ALL THESE FACTS, WE DECLINE TO INTERFERE IN THE ORDER OF THE L EARNED CIT (A) VIDE ITA NO.93/DEL/2010 3 WHICH THE IMPUGNED PENALTY HAS BEEN DELETED. THE AP PEAL FILED BY THE REVENUE BEING DEVOID OF MERIT IS DISMISSED. 6. IN THE RESULT, THE APPEAL IS DISMISSED. THE ORDER PRONOUNCED IN THE OPEN COURT ON 07.03.20 12. SD/- SD/- [B.C. MEENA] [I.P. BANSAL] ACCOUNTANT MEMBER JUDICIAL MEMBER DATED, 07.03.2012. DK COPY FORWARDED TO: - 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR, ITAT TRUE COPY BY ORDER, DEPUTY REGISTRAR, ITAT, DELHI BENCHES