I.T.O.9(1)(4), MUMBAI V. GAURI INVESTMENT PVT. LTD.(NOW KNOWN AS AVAKASH CONSULTANTS PVT LTD.), MUMBAI

ITA 6473/MUM/2012

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 87903 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 2 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-01-2015
• Appeal Filed By: Department
• Bench Allotted: G
• Next Hearing Date: 13-01-2015
• Assessment Year: 2003-2004
• Appeal Filed On: 23-10-2012
• Court: TRIBUNAL
• Department Lawyers: R N DSOUZA
• Keywords: Speculation loss

Judgement Text

1 IN THE INCO ME TAX APPELLATE TRIBUNAL G BENCH, MUMBAI BEFORE SHRI VIJAY PAL RAO, JUDICIAL MEMBER AND SHRI D. KARUNAKARA RAO, ACCOUNTANT MEMBER ./I.T.A. NO. 6473/M/2012 ( / ASSESSMENT YEAR : 2003 - 2004 ) ITO 9(1)(4), R.NO.224, 2 ND FLOOR, AAYAKAR BHAVAN, M.K. ROAD, MUMBAI 400 020. / VS. GAURI INVESTMENT PVT. LTD., ( NOW KNOWN AS AVAKASH CONSULTANTS PVT LTD), MARSHAL HOUSE ,MINT ROAD, OPP. RESERVE BANK OF INDIA, MUMBAI 400 001. ./ PAN : AAACG 1673J ( / APPELLANT) .. ( / RESPONDENT ) / APPELLANT BY : SHRI R.N. DSOUZA, DR / RESPONDENT BY : SHRI VIMAL PUNMIYA / DATE OF HEARING : 15.1.2015 / DATE OF PRONOUNCEMENT : 15.1.2015 / O R D E R PER D. KARUNAKARA RAO, AM: THIS APPEAL FILED BY THE REVENUE ON 23.10.2012 IS AGAINST THE ORDER OF THE CIT (A) - 19, MUMBAI DATED 17.8.2012 FOR THE ASSESSMENT YEAR 2003 - 2004. IN THIS APPEAL, REVENUE RAISED THE FOLLOWING GROUNDS WHICH READ AS UNDER: 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, WHETHER THE LD CIT (A) IS JUSTIFIED IN DELETING THE PENALTY OF RS. 4,26,230/ - LEVIED U/S 271(1)(C) ON ACCOUNT OF THE DISALLOWANCE MA DE BY THE ASSESSING OFFICER AND WHICH WERE CONFIRMED BY THE LD CIT (A). 2. THE LD CIT (A) HAS FAILED TO APPRECIATE THAT THE ASSESSEES CLAIM FOR DEDUCTION O F INTEREST EXPENSES PERTAINING TO EARLIER YEARS WAS NOT IN CONSONANCE WITH THE MERCANTILE SYSTEM OF A CCOUNTING FOLLOWED BY THE ASSESSEE AND TANTAMOUNT TO WILLFUL FURNISHING OF INACCURATE PARTICULARS OF ITS INCOME. 3. THE LD CIT (A) HAS FAILED TO APPRECIATE THAT THE ASSESSEES CLAIM TO SETTING OF B/F SPECULATION LOSS AGAINST NON - SPECULATION PROFIT OF CURREN T YEAR, TANTAMOUNT TO WILLFUL FURNISHING OF INACCURATE PARTICULARS OF INCOME. 2. AT THE OUTSET, LD COUNSEL FOR THE ASSESSEE MENTIONED THAT THE ISSUE UNDER CONSIDERATION RELATES TO LEVY OF PENALTY U/S 271(1)(C) OF THE ACT IN RESPECT OF ADDITIONS MADE BY T HE ASSESSING OFFICER ON ACCOUNT OF DISALLOWANCE OF INTEREST 2 PAYMENTS AND CLAIM OF SET OFF OF THE BROUGHT FORWARD SPECULATION LOSS AGAINST THE PROFIT FROM PURCHASE AND SALE OF THE BONDS. THE SAID ADDITIONS ARE EITHER DELETED B THE TRIBUNAL IN THE APPEAL IT A NO. 4143/M/2011 (AY 2003 - 2004), DATED 14.1.2015 OR IN CONNECTION WITH THE SET OFF OF THE SPECULATION LOSS, THE DISALLOWANCES ARE REMANDED TO THE FILE OF THE ASSESSING OFFICER FOR FRESH ADJUDICATION. PARA 10 OF THE SAID ORDER OF THE TRIBUNAL IS RELEVANT I N THIS REGARD. HE FILED THE COPY OF THE SAID ORDER OF THE TRIBUNAL (SUPRA). ON PERUSAL OF PARA 6.3 OF THE SAME, WHICH EVIDENCES THE ALLOWABILITY OF INTEREST EXPENDITURE CLAIM LEADING TO DELETING OF ADDITION AND CONSEQUENTLY THE CANCELLATION OF THE PENALT Y. FURTHER, PARA 10 OF THE SAID ORDER OF THE TRIBUNAL (SUPRA) CONFIRMS THE REMANDING OF THE ISSUES TO THE FILE OF THE ASSESSING OFFICER FOR FRESH ADJUDICATION. ACCORDINGLY, ALL THE GROUNDS RAISED BY THE REVENUE IN THE PRESENT APPEAL DO NOT SURVIVE CONSID ERING THE DELETION OF ADDITIONS IN THE QUANTUM APPEAL. ACCORDINGLY, GROUNDS RAISED BY THE REVENUE ARE DISMISSED. 3. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 15 TH JANUARY, 2015. S D / - S D / - (VIJAY PAL RAO) (D. KARUNAKARA RAO) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI ; 1 5 .1.2015 . . ./ OKK , SR. PS / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT(A) - 4. / CIT 5. , , / DR, ITAT, MUMBAI 6. / GUARD FILE . //TRUE COPY// / BY ORDER, / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI