DCIT 9 (1)(1), MUMBAI V. M/S AAROHEE MANAGEMENT CONSULTANCY PVT LTD. , MUMBAI

ITA 6286/MUM/2019

• Counselvise Citation: [2021] 107 COUNSELVISE.COM (IT) 9677 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 9 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-07-2021
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2011-2012
• Appeal Filed On: 03-10-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SMITA VERMA
• Section: 147

Judgement Text

1 ITA 6286/MUM/2019 IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, MUMBAI BEFORE SHRI SAKTIJIT DEY (JUDICIAL MEMBER) AND SHRI RAJESH KUMAR (ACCOUNTANT MEMBER) I.T.A. NO.6286/MUM/2019 (ASSESSMENT YEAR 2011-12) DCIT-9(1)(1), MUMBAI VS M/S AAROHEE MANAGEMENT CONSULTANCY PVT LTD,9, SHRI GURCHHAYA, TEJPAL SCHEME ROAD NO.02, VILE PARLE (E), MUMBAI-400 057 PAN : AAAECA8306N APPELLANT RESPONDENT APPELLANT BY SMT. SMITA VERMA, DR RESPONDENT BY SHRI RAJIV KHANDELWAL, AR DATE OF HEARING 01-07-2021 DATE OF PRONOUNCEMENT 29-07-2021 O R D E R PER : SAKTIJIT DEY (JM): THIS IS AN APPEAL BY THE REVENUE AGAINST ORDER DAT ED 23-07-2019 OF LEARNED COMMISSIONER OF INCOME TAX (APPEALS)-16, MUMBAI FOR THE ASSESSMENT YEAR 2011-12. 2. BRIEFLY THE FACTS ARE, THE ASSESSEE IS A RESIDEN T COMPANY ENGAGED IN THE BUSINESS OF DEALING AND TRADING IN SHARES AND SECUR ITIES. FOR THE ASSESSMENT YEAR UNDER DISPUTE, ASSESSEE FILED IS RETURN OF INCOME O N 29-09-2011 DECLARING TOTAL INCOME OF RS.44,85,363/-. SUBSEQUENTLY, BASED ON IN FORMATION RECEIVED FROM THE INVESTIGATION WING AT AHMEDABAD THAT THE ASSESSE HA S AVAILED THE BENEFIT OF SHORT 2 ITA 6286/MUM/2019 TERM CAPITAL LOSS OF RS.1,16,417/- FROM SALE OF SHA RES OF M/S DEVIKA PROTEINS LTD, ALLEGED TO BE A SHELL COMPANY, THE ASSESSING OFFICE R REOPENED THE ASSESSMENT UNDER SECTION 147 OF THE ACT. IN COURSE OF ASSESSM ENT PROCEEDINGS, THE ASSESSING OFFICER, AFTER ISSUING A SHOW CAUSE NOTICE TO THE A SSESSEE AS TO WHY THE SHORT TERM CAPITAL LOSS OF RS.1,16,417/- BEING THE LOSS FROM S ALE OF SHARES OF M/S DEVIKA PROTEINS LTD SHOULD NOT BE DISALLOWED, ULTIMATELY C OMPLETED THE ASSESSMENT BY ADDING BACK THE AMOUNT OF RS.1,16,417/-. ASSESSEE CONTESTED THE AFORESAID ADDITION BY FILING APPEAL BEFORE LEARNED COMMISSION ER (APPEALS). AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE IN THE CONTEXT OF FACTS AND MATERIALS ON RECORD, LEARNED COMMISSIONER (APPEALS) DELETED T HE ADDITION MADE BY THE ASSESSING OFFICER. 3. WE HAVE CONSIDERED RIVAL SUBMISSIONS AND PERUSED MATERIALS ON RECORD. IT IS EVIDENT, THE INVESTIGATION WING OF THE DEPARTMEN T AT AHMEDABAD HAD FORWARDED CERTAIN INFORMATION TO THE ASSESSING OFFI CER INDICATING THAT M/S DEVIKA PROTEINS LTD IS A SHELL COMPANY AND THE ASSESSEE IS A BENEFICIARY OF GAIN / LOSS DERIVED FROM TRANSACTING IN SHARES OF THE AFORESAID COMPANY. HOWEVER, IT IS EVIDENT, FROM THE STAGE OF ASSESSMENT PROCEEDINGS I TSELF THE ASSESSEE HAD VERY CLEARLY AND CATEGORICALLY STATED THAT IT HAS NOT TR ANSACTED IN ANY SCRIP OF M/S DEVIKA PROTEINS LTD DURING THE YEAR. IN SUPPORT OF SUCH CLAIM, ASSESSEE NOT ONLY HAS FURNISHED AN AFFIDAVIT BUT ALSO A STATEMENT FRO M THE BROKER. DESPITE THE ASSERTION OF THE ASSESSEE THAT IT HAS NOT TRANSACTE D IN THE SHARES OF M/S DEVIKA PROTEINS LTD, THE ASSESSING OFFICER WENT AHEAD TO D ISALLOW THE ALLEGED LONG TERM CAPITAL LOSS OFRS.1,16,417/- AND ADDED IT BACK TO T HE INCOME OF THE ASSESSEE. HOWEVER, BEING CONVINCED WITH THE SUBMISSIONS OF TH E ASSESSEE THAT IT HAD NOT 3 ITA 6286/MUM/2019 TRANSACTED IN SHARES OF M/S DEVIKA PROTEINS LTD, LE ARNED COMMISSIONER (APPEALS) HAS DELETED THE ADDITION. 4. BEFORE US ALSO, LEARNED COUNSEL FOR THE ASSESSEE HAS VEHEMENTLY URGED THAT DURING THE YEAR UNDER CONSIDERATION, NEITHER THE AS SESSEE HAD TRANSACTED IN SHARES OF M/S DEVIKA PROTEINS LTD NOR HAS SHOWN ANY LOSS FROM SUCH TRANSACTION. ON A PERUSAL OF MATERIALS ON RECORD AND PARTICULARL Y FROM THE OBSERVATIONS OF LEARNED COMMISSIONER (APPEALS), WE HAVE OBSERVED TH AT NOT ONLY BEFORE THE ASSESSING OFFICER, BUT EVEN BEFORE LEARNED COMMISSI ONER (APPEALS), THE ASSESSEE HAD FURNISHED DOCUMENTARY EVIDENCE IN SUPPORT OF IT S CLAIM THAT IT HAD NOT TRANSACTED IN SHARES OF M/S DEVIKA PROTEINS. EVEN BEFORE US, THE REVENUE HAS NOT BEEN ABLE TO FURNISH ANY MATERIAL TO CONTROVERT THE ASSERTION OF THE ASSESSEE THAT IT HAD NOT TRANSACTED IN THE SHARES OF M/S DEVIKA P ROTEINS LTD AND HAS NOT BOOKED ANY LOSS. THAT BEING THE CASE, WE ARE UNABLE TO INT ERFERE WITH THE DECISION OF LEARNED COMMISSIONER (APPEALS). GROUNDS ARE DISMIS SED. 5. IN THE RESULT, BOTH THE APPEAL IS DISMISSED. ORDER PRONOUNCED ON 29/07/2021. SD/- SD/- RAJESH KUMAR SAKTIJIT DEY ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI, DT : 29/07/2021 PAVANAN 4 ITA 6286/MUM/2019 COPY TO : 1. APPELLANT 2. RESPONDENT 3. THE CIT CONCERNED 4. THE CIT(A) 5. THE DR, ITAT, MUMBAI 6. GUARD FILE /TRUE COPY/ BY ORDER ASSTT. REGISTRAR, ITAT, MUMBAI