Shyam Nandkishore Mundada, Jalna V. Income-tax Officer,

ITA 796/PUN/2015

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 9395 (ITAT-PUNE)
• Duration Of Justice: 2 year(s) 8 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-02-2018
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 01-02-2018
• Assessment Year: 2010-2011
• Appeal Filed On: 29-05-2015
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: N O N E
• Keywords: Business income; Speculation loss

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, PUNE , , , BEFORE SHRI ANIL CHATURVEDI, AM AND SHRI VIKAS AWASTHY, JM . / ITA NO . 7 96 /P U N/201 5 / ASSESSMENT YEAR : 20 10 - 11 SHRI SHYAM NANDKISHORE MUNDADA, 1759, PARADGAON ROAD, PARTUR, DISTT. - JALNA - 431501 PAN : AWOPN8722H ....... / APPELLANT / V/S. THE INCOME TAX OFFICER, WARD 1 (3), JALNA / RESPONDENT ASSESSEE BY : N O N E REVENUE BY : SHRI ACHAL SHARMA / DATE OF HEARING : 01 - 02 - 2018 / DATE OF PRONOUNCEMENT : 02 - 0 2 - 201 8 / ORDER PER VIKAS AWASTHY, JM : TH IS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF COMMI SSIONER OF INCOME TAX (APPEALS) - 1, AURANGABAD DATED 30 - 03 - 2015 FOR THE ASSESSMENT YEAR 2010 - 11. 2. T HE APPEAL WAS CALLED TWICE FOR HEARING . NEITHER THE ASSESSEE NOR ANY AUTHORIZED REPRESENTATIVE OF THE ASSESSEE WAS PRESENT IN THE COURT TO 2 ITA NO . 796/PUN/2015, A.Y. 2010 - 11 ATTEND THE HEARING OF CASE. A PERUSAL OF CASE FILE SHOWS THAT THE APPEAL WAS FIRST LISTED FOR HEARING ON 13 - 06 - 2017. THE NOTICE OF APPEAL WAS SENT TO THE ASSESSEE THROUGH RPAD ON THE ADDRESS MENTIONED IN FORM NO. 36. THE NOTICE WAS DULY SERVED ON THE AS SESSEE AS IS EVIDENT FROM ACKNOWLEDGMENT AVAILABLE IN RECORD. ON 13 - 06 - 2017 A REQUEST THROUGH E - MAIL FROM THE ASSESSEE WAS RECEIVED FOR ADJOURNMENT. THE APPEAL WAS ADJOURNED TO 31 - 08 - 2017. ON 30 - 08 - 2017 THE ASSESSEE AGAIN FILED LETTER PRAYING FOR ADJOUR NMENT WITH A REASON THAT THE ASSESSEE IS IN PROCESS APPOINTING COUNSEL FOR REPRESENTING THE CASE BEFORE THE TRIBUNAL. ON THE REQUEST OF ASSESSEE THE CASE WAS ADJOURNED TO 15 - 11 - 2017. ON THE SAID DATE NONE APPEARED ON BEHALF OF THE ASSESSEE. IN THE INTER EST OF JUSTICE FRESH NOTICE OF APPEAL WAS ISSUED TO THE ASSESSEE FO R 01 - 02 - 2018. THE NOTICE OF HEARING WAS SENT TO THE ASSESSEE THROUGH RPAD . THE NOTICE WAS DULY SERVED ON 24 - 11 - 2017 AS IS EVIDENT FROM ACKNOWLEDGMENT AVAILABLE ON FILE. TODAY, DESPITE SE RVICE OF NOTICE NEITHER THE ASSESSEE NOR ANY AUTHORIZED REPRESENTATIVE OF THE ASSESSEE IS PRESENT. IT APPEARS THAT THE ASSESSEE IS NOT KEEN TO PURSUE HIS APPEAL. ACCORDINGLY, WE PROCEED TO DECIDE THE APPEAL OF ASSESSEE ON THE BASIS OF MATERIAL AVAILABLE ON RECORD AND THE SUBMISSIONS OF LD. DR. 3 . THE FACTS OF THE CASE AS EMANATING FROM RECORDS ARE : THE ASSESSEE IS AN INDIVIDUAL HAVING INCOME FROM COMMISSION, DIVIDEND AND INTEREST. THE ASSESSEE FILED HIS RETURN OF INCOME FOR THE IMPUGNED ASSESSMENT YE AR ON 09 - 02 - 2012 DECLARING TOTAL INCOME RS.1,54,110/ - . DURING THE COURSE OF SCRUTINY ASSESSMENT, THE ASSESSING OFFICER MADE ADDITION OF RS.71,36,508/ - U/S. 69A O F THE INCOME TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT ). 3 ITA NO . 796/PUN/2015, A.Y. 2010 - 11 AGGRIEVED BY THE ASSESSMENT ORDER DATED 28 - 03 - 2013, THE ASSESSEE FILED APPEAL BEFORE THE COMMISSIONER OF INCOME TAX (APPEALS). THE COMMISSIONER OF INCOME TAX (APPEALS) AFTER ANALYZING THE FACTS OF THE CASE RESTRICTED THE ADDITION TO RS.53,71,944/ - AND THU S, PARTLY ALLOWED THE APPEAL OF ASSESSEE. NOW, THE ASSESSEE IS IN SECOND APPEAL BEFORE THE TRIBUNAL ASSAILING THE ADDITION OF RS.53,71,944/ - CONFIRMED BY THE COMMISSIONER OF INCOME TAX (APPEALS). 4. SHRI ACHAL SHARMA REPRESENTING THE DEPARTMENT VEHEMENT LY DEFENDED THE FINDINGS OF FIRST APPELLATE AUTHORITY. THE LD. DR SUBMITTED THAT DURING PROCEEDINGS BEFORE THE ASSESSING OFFICER THE ASSESSEE WAS ASKED TO FURNISH INFORMATION WITH RESPECT TO AMOUNT DEPOSITED IN THE BANK ACCOUNT MAINTAINED WITH JALNA PEOPL ES CO - OPERATIVE BANK LTD. THE CONTENTION OF THE ASSESSEE WAS THAT THE AMOUNT WAS DEPOSITED BY VARIOUS FARMERS FOR MAKING INVESTMENT IN COMMODITIES AND DERIVATIVES. HOWEVER, THE ASSESSEE FAILED TO FURNISH COMPLETE NAME AND ADDRESS INCLUDING PAN OF THE PER SONS FROM WHOM MONIES WERE RECEIVED. THE ASSESSEE FAILED TO EXPLAIN THE NATURE OF TRANSACTIONS. FURTHER, THE ASSESSEE NEITHER FURNISHED ANY CONFIRMATIONS NOR PRODUCED THE PERSON S FOR EXAMINATION FROM WHOM THE MONEY WAS ALLEGEDLY RECEIVED BY ASSESSEE. TH E ASSESSING OFFICER GIVEN A CATEGORIC FINDING THAT THE TRADING DONE BY ASSESSEE IS IN THE NATURE OF SPECULATION BUSINESS AND THE LOSS ARISING THERE FROM IS A SPECULATIVE LOSS WHICH CANNOT BE SET OFF AGAINST THE INCOME ASSESSED U/S. 69A OF THE ACT. HOWEVER , THE ASSESSEE CAN CARRY FORWARD THE LOSS FROM SPECULATIVE BUSINESS TO SUBSEQUENT ASSESSMENT YEARS. DURING THE PROCEEDINGS BEFORE THE FIRST APPELLATE AUTHORITY THE ASSESSEE REITERATED HIS SUBMISSIONS. THE COMMISSIONER OF INCOME TAX (APPEALS) AFTER APPREC IATING THE FACTS OF THE CASE AND FOLLOWING THE DECISION OF MUMBAI BENCH OF THE TRIBUNAL IN THE 4 ITA NO . 796/PUN/2015, A.Y. 2010 - 11 CASE OF VARSHA CORPORATION LTD. VS. DCIT REPORTED AS 65 SOT 99 HELD THAT THE LOSS OF RS.53,71,944/ - IN COMMODITY AND DERIVATIVE IS SPECULATIVE LOSS AND CANNOT BE SET OFF AGAINST BUSINESS INCOME . THE LD. DR SUBMITTED THAT THE ORDER OF COMMISSIONER OF INCOME TAX (APPEALS) IS REASONABLE AND JUSTIFIED. THEREFORE, THE SAME SHOULD BE UPHELD. 5. W E HAVE HEARD THE SUBMISSIONS MADE BY LD. DR AND HAVE PERUSED THE MATERIAL AVAILABLE ON RECORD. DURING THE COURSE OF ASSESSMENT PROCEEDINGS THE ASSESSING OFFICER HAD OBSERVED THAT THE ASSESSEE IS A REGISTERED CLIENT WITH ANGEL BROKING LTD. THE ASSESSEE IS INDULGING IN VARIOUS SPECULATIVE TRANSACTIONS IN COMMODITIES MA RKET. THE ASSESSEE HAS CONTRIBUT ED RS.71,36,508/ - TOWARDS MARGIN MONEY IN RESPECT OF ABOVE TRANSACTIONS FROM HIS BANK ACCOUNT MAINTAINED WITH JALNA PEOPLES CO - OPERATIVE BANK LTD. AND STATE BANK OF INDIA . THE ASSESSING OFFICER SOUGHT EXPLANATION FROM THE ASSESSEE WITH REGARD TO THE SOURCE OF DEPOSIT OF THE AMOUNTS IN HIS BANK ACCOUNTS. THE ASSESSEE FAILED TO FURNISH THE REQUISITE INFORMATION BEFORE THE ASSESSING OFFICER TO PROVE THE SOURCE OF CASH DEPOSIT IN HIS BANK ACCOUNT MAINTAINED WITH JALNA PEOPLES CO - OPERATIVE BANK LTD. EVEN BEFORE THE COMMISSIONER OF INCOME TAX (APPEALS) THE ASSESSEE FAILED TO FURNISH COMPLETE INFORMATION. THE ASSESSEE SUFFERED LOSS DURING SPECULATIVE TRANSACTIONS IN COMMODITIES MARKET, DERIVATIVES, ETC. THE ASSESSEE CLAIMED LOS S IN COMMODITIES AS BUSINESS LOSS. THE COMMISSIONER OF INCOME TAX (APPEALS) REJECTED THE CONTENTIONS OF THE ASSESSEE HELD THE SAME TO BE SPECULATIVE LOSS THAT CANNOT BE SET OFF AGAINST ANY OTHER INCOME. WHILE COMING TO SUCH A CONCLUSION THE COMMISSIONER OF INCOME TAX (APPEALS) PLACED RELIANCE ON THE DECISION OF MUMBAI BENCH OF THE TRIBUNAL IN THE CASE OF VARSHA CORPORATION LTD. VS. DCIT (SUPRA). WE FIND THAT THE ORDER OF COMMISSIONER OF INCOME TAX (APPEALS) IS WELL REASONED 5 ITA NO . 796/PUN/2015, A.Y. 2010 - 11 AND HENCE, WARRANTS NO INTERFE RENCE. THE APPEAL OF ASSESSEE SANS MERIT AND HENCE, THE SAME IS DISMISSED. 6. IN THE RESULT, THE APPEAL OF ASSESSEE IS DISMISSED. ORDER PRONOUNCED ON FRIDAY, THE 02 ND DAY OF FEBRUARY, 201 8 . SD/ - SD/ - ( / ANIL CHATURVEDI ) ( / VIKAS AWASTHY) / ACCOUNTANT MEMBER / JUDICIAL MEMBER / PUNE; / DATED : 02 ND FEBRUARY, 2018 RK / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT. 2. / THE RESPONDENT. 3. ( ) / THE CIT(A) - 1 , AURANGABAD 4. THE PRINCIPAL COMMISSIONER OF INCOME TAX - 1, AURANGABAD 5. , , , / DR, ITAT, A BENCH, PUNE. 6. / GUARD FILE. / / // TRUE COPY// / BY ORDER, / PRIVATE SECRETARY, , / ITAT, PUNE