M/s. R.P. Impex, Surat V. The Income tax Officer,OSD-1,Range-2, Surat

ITA 749/AHD/2010

• Counselvise Citation: [2013] 140 COUNSELVISE.COM (IT) 67681 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 6 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-09-2013
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2006-2007
• Appeal Filed On: 10-03-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: O P BATHEJA
• Section: 43(5)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD A BENCH BEFORE: SRI D.K TYAGI, JUDICIAL MEMBER AND SHRI ANIL CHATURVEDI, ACCOUNTAN T MEMBER M/S R.P. IMPEX, 604, TRIVIDH CHAMBERS, OPP. FIRE BRIGADE, BRING ROAD, SURAT PAN: AAHFR1773Q (APPELLANT) VS INCOME TAX OFFICER, OSD-I, RANGE-2, SURAT (RESPONDENT) REVENUE BY: SRI O.P. BATHEJA, SR.D.R. ASSESSEE BY: SRI HARDIK VORA, A.R. DATE OF HEARING : 13-09-2013 DATE OF PRONOUNCEMENT : 20-09-20 13 / ORDER PER : D.K. TYAGI, JUDICIAL MEMBER:- THIS IS THE ASSESSEES APPEAL AGAINST THE ORDER OF LD. CIT(A)-II SURAT DATED 29-12-2009. 2. THE ONLY EFFECTIVE GROUND TAKEN BY THE ASSESSEE READS AS UNDER:- ITA NO.749/AHD/2010 ASSESSMENT YEAR 2006-07 I.T.A NO.749/AHD/2010 A.Y. 2006-07 PAGE N O M/S RP IMPEX VS. ITO 2 1. THAT THE LD. AO HAS ERRED IN TREATING TRADING O F COMMODITY DERIVATIVE THROUGH RECOGNIZED EXCHANGES AS SPECULAT IVE TRANSACTIONS WITHIN MEANING OF SECTION 43(5) AND THEREBY ERRED I N DISALLOWING THE LOSS OF RS. 14,95,359/- BY TREATING THE SAME TO SPE CULATIVE LOSS. 3. BRIEF FACTS OF THE CASE ARE THAT ASSESSEE IS ENG AGED IN THE IMPORT, EXPORT AND TRADING OF YARN, FABRICS, MENTHOL RELATE D ITEMS AND BETTLENET. DURING THE COURSE OF ASSESSMENT PROCEEDINGS ASSESSI NG OFFICER OBSERVED THAT ASSESSEE HAS CLAIMED LOSS ON COMMODITY BUSINESS AMO UNTING TO RS. 14,95,359/-. THE AO TREATED THIS LOSS AS SPECULATI VE U/S 43(5) OF THE ACT AND ADDED THE SAME TO THE TOTAL INCOME OF THE ASSESSEE. IN APPEAL BEFORE LD. CIT(A) ASSESSEE RELIED ON THE WRITTEN SUBMISSIONS W HICH WERE DULY REPRODUCED BY THE LD. CIT(A) IN HIS ORDER AND AFTER TAKING INTO CONSIDERATION THE SAME, LD. CIT(A) CONFIRMED THE ACTION OF THE AO . 4. BEFORE US LEARNED COUNSEL OF THE ASSESSEE FOR TH E FIRST TIME TOOK A NEW PLEA THAT ASSESSEE HAS MADE DERIVATIVE TRANSACTIONS FOR HEDGING IN THE SAME COMMODITY I.E. MENTHA OIL IN WHICH IT WAS DOING TRA DING ACTIVITY AND EXPORTING. THE LEARNED COUNSEL OF THE ASSESSEE TOO K US TO VARIOUS PAGES OF THE PAPER BOOK FILED BY ASSESSEE TO CO-RELATE TRANS ACTIONS OF EXPORT, SALES OF COMMODITIES AND HEDGING DONE BY THE ASSESSEE FOR TH E SAME AND ARGUED THAT THE ISSUE IS SQUARELY COVERED BY THE PROVISIONS OF SECTION 43(5)(A) OF THE ACT. SINCE THIS PLEA HAS BEEN TAKEN FOR THE FIRST TIME B EFORE US AND WAS NOT BEFORE LOWER AUTHORITIES, WE DEEM IT PROPER THAT THE MATTE R BE SENT TO THE FILE OF AO FOR VERIFICATION OF APPLICABILITY OF SECTION 43(5)( A) OF THE ACT IN ASSESSEES CASE. WE HOLD ACCORDINGLY. I.T.A NO.749/AHD/2010 A.Y. 2006-07 PAGE N O M/S RP IMPEX VS. ITO 3 5. IN THE RESULT, ASSESSEES APPEAL IS ALLOWED FOR STATISTICAL PURPOSE. ORDER PRONOUNCED IN OPEN COURT ON THE DATE MENTIONE D HEREINABOVE AT CAPTION PAGE SD/- SD/- (ANIL CHATURVEDI) ( D.K. TYAGI) ACCOUNTANT MEMBER J UDICIAL MEMBER AHMEDABAD : DATED 20/09/2013 AK / COPY OF ORDER FORWARDED TO:- 1. ASSESSEE 2. REVENUE 3. CONCERNED CIT 4. CIT (A) 5. DR, ITAT, AHMEDABAD 6. GUARD FILE. BY ORDER/ , / ,