ADDL CIT 19(2), MUMBAI V. DR RAMESH C. SHAH, MUMBAI

ITA 864/MUM/2013

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 88010 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 11 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-01-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Next Hearing Date: 01-12-2014
• Assessment Year: 2009-2010
• Appeal Filed On: 01-02-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: LUV KUMAR
• Keywords: Business income

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH, MUMBAI , , . . , . BEFORE SHRI VIJAY PAL RAO , JM AND SHRI N.K. BILLAIYA, AM ./I.T.A. NO. 864/MUM/2013 ( / ASSESSMENT YEAR : 2009-10 ) A DDL. CIT - 19(2) ROOM NO.315, 3 RD FLOOR PIRAMAL CHAMBERS, LALBAUG, PAREL MUMBAI-400 012. / VS. DR. RAMESH C. SHAH 9, BHUPENDRA MANSION 10 PHIROZSHA STREET SANTACRUZ (W) MUMBAI- 400 054. ./ ./PAN/GIR NO. : AAFPS 8772 A ( /APPELLANT ) ( !' / RESPONDENT ) # / APPELLANT BY : SHRI LUV KUMAR (DR) !' $ # / RESPONDENT BY : NONE %& $ ' / DATE OF HEARING : 01/12/14 ()*+ $ ' / DATE OF PRONOUNCEMENT : 14 / 01/ 2015 , / O R D E R PER VIJAY PAL RAO, JM : THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST THE ORDER DATED 20/11/2012 OF CIT(A) FOR THE ASSESSMENT YEAR 2009-10. THE REVENUE HAS RAISED THE FOLLOWING GROUNDS :- 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD CIT(A) HAS ERRED IN ALLOWING TO TREAT THE SHORT TER M CAPITAL GAIN DECLARED BY THE ASSESSEE AT RS.20,96,968/- AS SUCH AND NOT AS BUSINESS INCOME, RELYING ON THE DECISION OF THE HON 'BLE ITAT FOR AY 2004-05 AND CIT(A)-XIX FOR AY 2006-07 RESPECTIVELY IN THE A SSESSEE'S OWN CASE IGNORING THE FACTS THAT THE SAID DECISIONS HAVE NO T BEEN ACCEPTED BY 2 ITA NO.864/13 DR. RAMESH C. SHAH THE DEPARTMENT. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE A ND IN LAW, THE LD CIT(A) HAS FAILED TO APPRECIATE THE FACT THAT THE A SSESSEE HAS MADE FREQUENT TRANSACTIONS OF SALE AND PURCHASE OF SHARE S AND THE MAGNITUDE OF TRANSACTION IS ALSO HUGE WHICH CLEARLY ESTABLISH THAT THE MOTIVE FOR TRANSACTIONS WAS TO EARN PROFIT BY PURSU ING AN ADVENTURE IN THE NATURE OF TRADE. 3. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE A ND IN LAW, THE LD CIT(A) HAS ALSO ERRED IN RELYING ON THE DECISION OF HON'BLE ITAT, MUMBAI IN THE CASE OF GOPAL PUROHIT [29 SOT 117(MUM )] WITHOUT APPRECIATING THE FACT THAT THE SAID DECISION HAS NO T BEEN ACCEPTED BY THE DEPARTMENT. 4. THE APPELLANT PRAYS THAT THE ORDER OF THE CIT(A) ON THE ABOVE GROUND BE SET ASIDE AND THAT OF THE AO BE RESTORED. 2. THE ASSESSEE IS A DOCTOR BY PROFESSION. DURING T HE YEAR UNDER CONSIDERATION, THE ASSESSEE HAS SHOWN INCOME FROM MEDICAL PROFESSION, INCOME FROM FUTURE TRADING AND INCOME FROM SHORT TERM CAPITAL GAIN, AS WELL AS INC OME FROM OTHER SOURCES. THE ASSESSEE HAS ALSO EARNED LONG TERM CAPITAL GAIN ON SALE OF SHARES APART FROM SHORT TERM CAPITAL GAIN ON SALE OF SHARES. THE ASSESSEE HAS EA RNED DIVIDEND INCOME OF RS.24,92,795/-. THE AO TREATED THE SHORT TERM CAPIT AL GAIN AS BUSINESS INCOME AND ASSESSED TO TAX ACCORDINGLY. ON APPEAL THE CIT(A) D ECIDED THE ISSUE IN FAVOUR OF THE ASSESSEE BY FOLLOWING THE DECISION OF THIS TRIBUNAL IN ASSESSEES OWN CASE FOR ASSESSMENT YEAR 2004-05 AND 2006-07. 3. WE HAVE HEARD THE LD. DR AND CONSIDERED THE REL EVANT MATERIAL ON RECORD. SINCE NOBODY HAS APPEARED ON BEHALF OF THE ASSESSEE RESPO NDENT, THEREFORE, WE PROPOSE TO DISPOSE OF THIS APPEAL EXPARTE. THE LD. CIT(A) HAS DECIDED THE ISSUE IN PARA 3.6 AS UNDER :- 3.6 THUS TAKING INTO ACCOUNT ALL THE FACTS AND CIR CUMSTANCES AS WELL AS LEGAL POSITION IT IS HELD THAT THE AO WAS NOT JUSTIFIED I N TREATING SHORT TERM CAPITAL GAINS DECLARED AT RS.20,96,968/- AS BUSINES S INCOME. THE APPELLANT HAS PREDOMINANTLY USED HIS OWN FUNDS AND FOR MAKING INV ESTMENT IN SHARES. THE APPELLANT HAS UTILIZED ABOUT 99.67% OF ITS OWN AND FAMILY FUNDS TO INVEST IN SHARES. IT IS PERTINENT TO NOTE THAT IN THE CASE OF THE APPELLANT FOR A.Y. 2004-05 THE HON.BLE ITAT 'D' BEN CH HAD UPHELD THE DECISION OF CIT(A) XIX WHO HAD HELD THAT INCOME OF THE APPELLANT WAS TO BE TAXED AS STCG AND NOT AS BUSINESS INCOME. FOR A.Y. 2006-07, THE LEARNED 3 ITA NO.864/13 DR. RAMESH C. SHAH CIT(A)-XIX HAD ALSO ALLOWED THE APPEAL OF THE APPEL LANT BY HOLDING THAT STCG SHOWN BY THE APPELLANT ARE TO BE TAXED AS STCG ONLY AND NOT AS BUSINESS INCOME. THE FACTS OF THE CASE FOR THIS YEA R ARE MORE OR LESS SIMILAR TO THE FACTS AND CIRCUMSTANCES, OF THE CASE IN A.YRS.2 004-05 & 2O06- 07.THEREFORE, FOLLOWING THE EARLIER YEAR'S DECISION OF THE HON'BLE ITAT AND CIT(A)-XIX IT IS HEL D THAT THE AO WAS NOT JUSTIFIED IN TREATING STCG DE CLARED BY THE APPELLANT AT RS.20,96,968/- AS BUSINESS INCOME. 3.1 THE GRIEVANCE OF THE REVENUE IS THAT THE DEPART MENT HAS NOT ACCEPTED THE DECISION OF THIS TRIBUNAL FOR ASSESSMENT YEAR 2005- 06, 2006-07. SINCE THE DECISION OF THIS TRIBUNAL FOR THE ASSESSMENT YEAR 2005-06 AND 2 006-07 HAS NEITHER BEEN REVERSED NOR STAYED BY THE HON'BLE HIGH COURT, THEREFORE, WE DO NOT FIND ANY REASON TO INTERFERE WITH THE IMPUGNED ORDER OF THE LD. CIT(A) QUA THIS ISSUE BY FOLLOWING THE DECISION OF THIS TRIBUNAL IN ASSESSEES OWN CASE. 4. THE APPEAL OF THE REVENUE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 14 TH JANUARY, 2015. . , $ ()*+ % - . / 14/01/2015 ) $ 0& SD/- SD/- (N.K. BILLAIYA) (VIJAY PAL RAO ) / ACCOUNTANT MEMBER / JUDICIAL MEMBER %& MUMBAI; . DATED 14/01/2015. . . ./ JV, 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. / BY ORDER, //TRUE COPY// / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI