DCIT CIR 13(3), MUMBAI V. RAVINDRAKUMAR AGGARWAL, MUMBAI

ITA 6169/MUM/2009

• Counselvise Citation: [2010] 136 COUNSELVISE.COM (IT) 1190 (ITAT-MUMBAI)
• Duration Of Justice: 7 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-06-2010
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Assessment Year: 2006-2007
• Appeal Filed On: 26-11-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: JI TENDRA YADAV
• Keywords: Business income; Capital Gains

Judgement Text

1 ITA NO.6169/MUM/2009 IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH D MUMBAI BEFORE SHRI R S PADVEKAR, JM & SHRI B RAMAKOTAIAH, AM ITA NO. 6169/MUM/2009 (ASST YEAR 2006-07) THE ASST COMMR OF INCOME TAX 13(3), MUMBAI VS SHRI RAVINDRAKUMAR AGGARWAL 14/16 BHANDARI CROSS LANE 1T FLOOR, VADGADI MUMBAI 3 (APPELLANT) (RESPONDENT) PAN ACRPA 3765D ASSESSEE BY: SHRI VIJAY MEHTA REVENUE BY: SHRI JITENDRA YADAV O R D E R PER R S PADVEKAR: IN THIS APPEAL, THE REVENUE HAS CHALLENGED THE IMP UGNED ORDER OF THE LD CITA) -24, MUMBAI FOR THE ASSESSMENT YEAR 2006-0 7 DATED 29.9.2009. 2 THE REVENUE HAS TAKEN THE FOLLOWING EFFECTIVE GRO UND: ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD CIT(A) HAS ERRED IN DIRECTING THE A.O. TO TREAT THE PROFIT EARNED FROM INVESTMENT ACTIVITY AS SHORT TERM CAPITAL GAIN. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN L AW, THE LD CIT(A) HAS ERRED IN DIRECTING THE A.O. TO DELETE THE DISAL LOWANCE OF RS. 16,61,913/- MADE BY THE A.O. IN TREATING THE IN COME AND DIRECTING A.O. TO ASSESS IT AS LONG TERM CAPITAL GAIN. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN L AW, THE LD CIT(A) HAS FAILED TO APPRECIATE THE FACT THAT TREATMENT GI VEN BY THE ASSESSEE IN THE BOOKS OF ACCOUNTS IS NOT A DECISIVE FACTOR. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN L AW, THE LD CIT(A) HAS FAILED TO NOTICE THAT ASSESSEE DEALT IN NUMEROU S TRANSACTIONS BOTH IN VOLUMES AND IN FREQUENCY IN AN ORGANISED MANNER. 2 ITA NO.6169/MUM/2009 3 WE HAVE HEARD THE PARTIES. THE ASSESSEE IS ENGAGE D IN THE BUSINESS OF TRADING IN DYES AND CHEMICALS. THE ASSESSEE HAS SHO WN INCOME UNDER THE HEAD CAPITAL GAINS AT RS.62,29,243/- AS SHORT TERM CAPITAL GAINS AND RS. 16,61,913/- AS LONG TERM CAPITAL GAIN. THE A.O. DID NOT ACCEPT THE PLEA OF THE ASSESSEE THAT THE SHARES WERE HELD AS INVEST MENTS FOR THE REASONS THAT IN THE A.Y 2005-06 THE ENTIRE GRAINS ON THE SA LE OF THE SHARES WERE CONSIDERED AS BUSINESS INCOME. 3.1 AFTER REPEATING THE REASONS GIVEN FOR REJECTING THE CLAIM OF THE ASSESSEE IN THE A.Y 2005-06, THE A.O. TREATED THE E NTIRE CAPITAL GAINS DECLARED BY THE ASSESSEE AS BUSINESS INCOME OF THE ASSESSEE AND ACCORDINGLY COMPUTED THE INCOME OF THE ASSESSEE. T HE ASSESSEE CHALLENGED THE ORDER OF THE A.O. BEFORE THE LD CIT(A), WHO BY FOLLOWING THE ORDER FOR THE A.Y 2005-06, ALLOWED THE CLAIM OF THE ASSESSEE. 4 THE LD COUNSEL FOR THE ASSESSEE SUBMITTED THAT TH E REVENUE HAS CHALLENGED THE ORDER OF THE LD CIT(A) FOR THE A.Y 2 005-06 ON THIS ISSUE; BUT THE TRIBUNAL DISMISSED THE APPEAL OF THE REVENUE I N ITA NO.2063/MUM/2009 VIDE ORDER DATED 30.4.2010. THE LD COUNSEL OF THE ASSESSEE FILED A COPY OF THE ORDER OF THE TRIBUNAL FOR A.Y 2005-06 WHICH IS PLACED ON RECORD. 4.1 THE LD DR FAIRLY ACCEPTED THAT THE APPEAL FILED BY THE REVENUE FOR A.Y 2005-06 HAS BEEN DISMISSED BY THE TRIBUNAL BY CONFI RMING THE ORDER OF THE LD CIT(A). 5 ADMITTEDLY, IN THIS APPEAL, THE FACTS ARE IDENTIC AL AND MOREOVER, BOTH THE AUTHORITIES HAVE RELIED ON THEIR RESPECTIVE ORD ERS FOR THE A.Y 2005-06. THE TRIBUNAL HAS DECIDED THE ISSUE IN THE A.Y 2005- 06 IN FAVOUR OF THE 3 ITA NO.6169/MUM/2009 ASSESSEE. WE, ACCORDINGLY, UPHOLD THE ORDER OF THE LD CIT(A) FOR THE YEAR UNDER CONSIDERATION ALSO FOR THE REASONS GIVEN BY T HE TRIBUNAL IN ASSESSEES OWN CASE FOR THE A.Y 2005-06. 6 IN THE RESULT, THE APPEAL FILED BY THE REVENUE IS DISMISSED. ORDER PRONOUNCED ON THE 29 TH , DAY OF JUNE 2010. SD/- SD/- ( B RAMAKOTAIAH ) ACCOUNTANT MEMBER (R S PADVEKAR ) JUDICIAL MEMBER PLACE: MUMBAI : DATED: 29 TH , JUNE 2010 RAJ* COPY FORWARDED TO: 1 APPELLANT 2 RESPONDENT 3 CIT 4 CIT(A) 5 DR /TRUE COPY/ BY ORDER DY /AR, ITAT, MUMBAI