ACIT 24(1), MUMBAI V. ATUL M RAMAIYA, MUMBAI

ITA 6443/MUM/2011

• Counselvise Citation: 644319914 RSA 2011
• Duration Of Justice: 2 year(s) 11 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-09-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 11-09-2014
• Assessment Year: 2006-2007
• Appeal Filed On: 21-09-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ASGHAR ZAIN V P
• Assessee Lawyers: B V JHAVERI
• Keywords: Business income
• Section: 143(3)

Judgement Text

, INCOME TAX APPELLATE TRIBUNAL,MUMBAI - A BENCH. , ! '# , ' ! BEFORE S/SH. JOGINDER SINGH,JUDICIAL MEMBER & RAJENDRA,ACCOUNTANT MEMBER /. ITA NO.6443/MUM/2011, $ $ $ $ / ASSESSMENT YEAR2006-07 DCIT 24(1) BKC,BANDRA (E) MUMBAI-51 VS. ATUL M. RAMAIYA, 23, DATTANI CHAMBERS, OPP. SHANTINATH SHOPPING CENTER, S.V. ROAD, MALAD (W),MUMBAI -64 PAN:AAAPR8012P ( %& / APPELLANT) ( '(%& / RESPONDENT) ! ) * ' / REVENUE BY : SHRI ASGHAR ZAIN V.P. +, +, +, +, * * * * ' '' ' / ASSESSEE BY : SHRI B.V.JHAVERI ) )) ) , - , - , - , - / DATE OF HEARING : 11-09-2014 .$ ) , - / DATE OF PRONOUNCEMENT : 11-09-2014 , 1961 ) )) ) 254 ( 1 ) ' '' ' ,, ,, ,, ,, '/ '/ '/ '/ ORDER U/S.254(1)OF THE INCOME-TAX ACT,1961(ACT) PER RAJENDRA,AM ' ' ' ' ! ! ! ! '# '# '# '# ' '' ' : CHALLENGING THE ORDER DT.18.07.2011OF THE CIT(A)-34 ,MUMBAI,ASSESSEE HAS RAISED FOLLOWING GROUNDS OF APPEAL: 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE A ND IN LAW, THE LD. CIT(A) ERRED IN DELETING THE PENALTY LEVIED U/S.271(1)(C) AMOUNTING TO RS.5L ,49,916/-, WITHOUT APPRECIATING THE FACT THAT THE ASSESSEE HAS DELIBERATELY OFFERED INCOME FROM DEALI NG IN SHARES AS CAPITAL GAIN INSTEAD OF INCOME FROM BUSINESS AND PROFESSION WITH THE INTE NTION TO AVOID PAYMENT OF RIGHTFUL TAX. 2.THE APPELLANT CRAVES LEAVE TO AMEND OR ALTER ANY GROUND OR ADD NEW GROUND WHICH MAY BE NECESSARY 2. RETURN OF INCOME WAS FILED BY THE ASSESSEE,AN INDIV IDUAL,ON 07.07.2006 DECLARING A TOTAL INCOME OF RS.3,48,69,399/- INCLUDING THE SHORT TERM CAPITA L GAIN(STCG)OF RS.1,81,06,413/-, EXEMPT LONG TERM CAPITAL GAIN (LT CG)OF RS.35,34,865/-.THE ASSESSMENT-WAS COMPLETED ON 15.12.2008 U/S. 143(3) OF THE ACT, ASSESSING THE TO TAL INCOME AT RS.3,86,31 580/-. DURING THE ASSESSMENT PROCEEDINGS THE AO FOUND THAT THE ASSESSEE WAS ENGAGED IN THE TRADING OF SHARES & SECURITIES AND FOR THE YEAR UNDER CONSIDER ATION AND HAD SHOWN BUSINESS INCOME,LTCG STCG AND INCOME FROM OTHER SOURCES. WHILE COMPLETIN G THE ASSESSMENT IT WAS HELD BY THE AO THAT THE ASSESSEE WAS ENGAGED MAINLY IN ACTIVITY OF EARNING PROFIT THROUGH SALE AND PURCHASE OF SHARES.THEREFORE, THE STCG AND LTCG CLAIMED BY THE ASSESSEE WAS ASSESSED UNDER THE HEAD INCOME FROM BUSINESS AND PROFESSION AND ACCORDINGLY , PENALTY PROCEEDINGS U/S 271(1)(C) WERE INITIATED FOR FURNISHING INACCURATE PARTICULARS OF INCOME.AO HELD THAT THE ASSESSEE HAD CONCEALED INCOME BY SHOWING HIS BUSINESS INCOME-AS INCOME FRO M LTCG AND STCG.AFTER CONSIDERING THE REPLY OF THE ASSESSEE,THE AO LEVIED PENALTY OF RS.5 1.49 LAKHS U/S.271(1)(C)OF THE ACT. AGGRIEVED BY THE ORDER OF THE ORDER OF THE AO,THE A SSESSEE FILED AN APPEAL BEFORE THE FIRST APPELLATE AUTHORITY(FAA),WHO DELETED THE PENALTY.TH E AO HAS COME BEFORE US,AGAINST THE SAID ORDER OF THE FAA. 3. DURING THE COURSE OF HEARING BEFORE US,THE AUTHORIS ED REPRESENTATIVE(AR)STATED THAT IN QUANTUM APPEAL THE TRIBUNAL HAD DELETED THE ADDITIO N MADE BY THE AO AND UPHELD BY THE FAA, 2 ITA NO.6443/M/2011 ATUL M. RAMAIYA THAT THE APPEAL FILED BY THE DEPARTMENT BEFORE THE HONBLE BOMBAY HIGH COURT WAS DISMISSED, THAT APPEAL FILED BY THE AO SHOULD BE DISMISSED.DR LEFT THE MATTER TO THE DISCRETION OF THE BENCH. 4. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL BEFORE US.WE FIND THAT THE WHILE FINALISING THE ASSESSMENT,THE AO HAD TREATED THE SA LE OF SHARES BY THE ASSESSEE AS BUSINESS AND THE FAA HAD UPHELD HIS ORDER.THE A BENCH OF MUMBAI TRIB UNAL,VIDE ITS ORDER DATED 23.09. 2011(ITA/5081/MUM/2009-AY.2006-07)HAD ALLOWED THE A PPEAL BY THE ASSESSEE AND HELD THAT THE INCOME OF THE ASSESSEE ARISING OUT OF SHARE TRANSAC TION SHOULD NOT BE ASSESSED AS BUSINESS INCOME,THAT THE HONBLE JURISDICTIONAL HIGH COURT H AD DISMISSED THE APPEAL FILED BY THE DEPARTMENT ON 07.04. 2014,WHILE DECIDING ITA NO.508 1/MUM/2009.CONSIDERING THE ABOVE FACTS WE ARE OF THE OPINION THAT PENALTY LEVIED BY THE AO CANNOT SURVIVE ANY MORE.HOWEVER,THE FAA HAS ALREADY DELETED THE PENALTY.CONFIRMING HIS ORDE R,WE DECIDE THE EFFECTIVE GROUND OF APPEAL AGAINST THE AO. AS A RESULT,APP EAL FILED BY THE AO STANDS DISMISSED. 0,1 0,1 0,1 0,1 +, +, +, +, - 3 4 ) 5 ) , 6 - 3 4 ) 5 ) , 6 - 3 4 ) 5 ) , 6 - 3 4 ) 5 ) , 6. .. . ORDER PRONOUNCED IN THE OPEN CO URT ON 11 TH ,SEPTEMBER,2014 . '/ '/ '/ '/ ) )) ) .$ .$ .$ .$ ' ' ' ' 8 88 8 9 9 9 9 11 ,: ,: ,: ,: , 201 4 ) )) ) ; ;; ; SD/- SD/- ( / JOGINDER SINGH) ( '# '# '# '# / RAJENDRA) ! / JUDICIAL MEMBER ' ' ' ' ! ! ! ! /ACCOUNTANT MEMBER / MUMBAI, 9 /DATE: 11.09.2014. SK '/ '/ '/ '/ ) )) ) ',< ',< ',< ',< ='<$, ='<$, ='<$, ='<$, / COPY OF THE ORDER FORWARDED TO : 1. ASSESSEE / %& 2. RESPONDENT / '(%& 3. THE CONCERNED CIT(A)/ > ? , 4. THE CONCERNED CIT / > ? 5. DR A BENCH, ITAT, MUMBAI / <@ ', , , . . . 6. GUARD FILE/ 0 ( <, ( <, ( <, ( <, ', ',', ', //TRUE COPY// '/ / BY ORDER, A / DY./ASST. REGISTRAR , /ITAT, MUMBAI.