M/s Swarnim Multiventures (P) Limited, Hyderabad V. Dy.CIT, Circle-3(3), Hyderabad

MA 94/HYD/2013

• Counselvise Citation: [2013] 124 COUNSELVISE.COM (IT) 0847 (ITAT-HYDERABAD)
• Duration Of Justice: 5 month(s) 11 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 23-08-2013
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: misc
• Appeal Filed On: 13-03-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MALLIKARJUNA
• Assessee Lawyers: P MURALI MOHAN RAO
• Keywords: Business income; Opportunity of being heard

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH B', HYDERABAD BEFORE SHRI CHANDRA POOJARI, ACCOUNTANT MEMBER AND SMT. ASHA VIJAYARAGHAVAN, JUDICIAL MEMBER MA NOS. 93, 94 & 95/HYD/2013 (IN ITA NOS. 803/HYD/2011 & 452 & 453/HYD/12 A.YS. 2006-07, 2007-08 & 2008-09 M/S SWARNIM MULTIVENTURES P. LTD., HYDERABAD. (PAN AAFCS1508 R) VS . DY. COMMISSIONER OF INCOME-TAX, CIRCLE - 3(3), HYDERABAD. APPELLANT RESPONDENT APPELLANT BY: SHRI P. MURALI MOHAN RAO RESPONDENT BY: SHRI MALLIKARJUNA DATE OF HEARING: 23/08/2013 DATE OF PRONOUNCEMENT: 23/08/2013 O R D E R PER CHANDRA POOJARI, A.M.: THESE ABOVE MISCELLANEOUS APPLICATIONS FILED BY ASSESSEE STATING THAT THE TRIBUNAL HAS NOT GIVEN CL EAR CUT FINDING IN ITS ORDER DATED 21/09/2012 REGARDING REM ITTING THE ISSUE TO THE FILE OF THE ASSESSING OFFICER FOR FRESH CONSIDERATION. AS SUCH, THE ASSESSING OFFICER NOT G IVING OPPORTUNITY OF HEARING TO THE ASSESSEE GIVING ATTEN TION TO THE PARA 12 OF THE TRIBUNALS ORDER (SUPRA), WHICH IS AS FOLLOWS: 12. IN THE LIGHT OF THE ABOVE PARAMETERS AND THE DECISION OF THE JURISDICTIONAL HIGH COURT, ON PERUS AL OF THE STATEMENTS INCORPORATED BY THE ASSESSING OFFICER IN THE ASSESSMENT ORDER FOR THE ASSESSMENT MA NOS. 93, 94 & 95/ HYD/2013 M/S SWARNIM MULTIVENTURES (P.) LTD. 2 YEAR 2008-09, WE FIND THAT THE ASSESSEE HAS MADE SEVERAL TRANSACTIONS OF PURCHASE OF SHARES DURING THE RELEVANT YEAR UNDER CONSIDERATION, AND IF THERE HIGH VOLUME, FREQUENCY AND REGULARITY OF THE ACTIVITY CARRIED ON BY THE ASSESSEE IN A SYSTEMATIC MANNER, IT WOULD PARTAKE THE CHARACTER OF BUSINESS ACTIVITIES CARRIED ON BY THE ASSESSEE IN SHARES, AN D IT CANNOT BE SAID THAT THE ASSESSEE HAS MERELY MADE INVESTMENTS IN SHARES. FURTHER, EVIDENCE BROUGHT ON RECORD SHOWS THAT THE ASSESSEE IS CARRYING ON BOTH PORTFOLIOS, VIZ. INVESTMENT AS WELL AS BUSINESS AND FOR ARRIVING AT PROPER CONCLUSION, THE ASSESSEE HAS TO FURNISH THE RELEVANT DATA FOR ARRIVING AT THE NATURE OF THE RELEVANT TRANSACTIONS, AND THE TREATMENT GIVEN BY THE ASSESSEE IN ITS BOOKS OF ACCOUNT CANNOT BE CONCLUSIVE AND THE ASSESSING OFFICER HAS TO SEE THE REAL INTENTION OF THE ASSESS EE IN HOLDING THE RELEVANT SHARES. THE ASSESSEE IS ALS O DIRECTED TO FURNISH THE DETAILS OF SHARES HELD AS INVESTMENT AND AS STOCK IN TRADE. ON FURNISHING THE ENTIRE DATA BY THE ASSESSEE, THE ASSESSING OFFICER HAS TO REDETERMINE THE INCOME RELATING TO EACH CATEGORY OF SHARES AS BUSINESS INCOME OR INCOME FROM CAPITAL GAINS AS THE CASE MAY BE, IN CONFORMIT Y WITH CIRCULAR NO.4 OF 2007 DATED 15.6.2007. 2. THE DR CONCEDED WITH THE ARGUMENTS OF THE LEARNE D AR OF THE ASSESSEE. 3. WE HAVE CONSIDERED THE SUBMISSIONS OF THE LEARNE D AR. THEREFORE, PARA 12 OF THE ORDER OF THE TRIBUNAL , AS MENTIONED ABOVE, TO BE READ AS UNDER: 12. IN THE LIGHT OF THE ABOVE PARAMETERS AND THE DECISION OF THE JURISDICTIONAL HIGH COURT, ON PERUS AL OF THE STATEMENTS INCORPORATED BY THE ASSESSING OFFICER IN THE ASSESSMENT ORDER FOR THE ASSESSMENT YEAR 2008-09, WE FIND THAT THE ASSESSEE HAS MADE SEVERAL TRANSACTIONS OF PURCHASE OF SHARES DURING THE RELEVANT YEAR UNDER CONSIDERATION, AND IF THERE MA NOS. 93, 94 & 95/ HYD/2013 M/S SWARNIM MULTIVENTURES (P.) LTD. 3 HIGH VOLUME, FREQUENCY AND REGULARITY OF THE ACTIVITY CARRIED ON BY THE ASSESSEE IN A SYSTEMATIC MANNER, IT WOULD PARTAKE THE CHARACTER OF BUSINESS ACTIVITIES CARRIED ON BY THE ASSESSEE IN SHARES, AN D IT CANNOT BE SAID THAT THE ASSESSEE HAS MERELY MADE INVESTMENTS IN SHARES. FURTHER, EVIDENCE BROUGHT ON RECORD SHOWS THAT THE ASSESSEE IS CARRYING ON BOTH PORTFOLIOS, VIZ. INVESTMENT AS WELL AS BUSINESS AND FOR ARRIVING AT PROPER CONCLUSION, THE ASSESSEE HAS TO FURNISH THE RELEVANT DATA FOR ARRIVING AT THE NATURE OF THE RELEVANT TRANSACTIONS, AND THE TREATMENT GIVEN BY THE ASSESSEE IN ITS BOOKS OF ACCOUNT CANNOT BE CONCLUSIVE AND THE ASSESSING OFFICER HAS TO SEE THE REAL INTENTION OF THE ASSESS EE IN HOLDING THE RELEVANT SHARES. THE ASSESSEE IS ALS O DIRECTED TO FURNISH THE DETAILS OF SHARES HELD AS INVESTMENT AND AS STOCK IN TRADE. ON FURNISHING THE ENTIRE DATA BY THE ASSESSEE, THE ASSESSING OFFICER HAS TO REDETERMINE THE INCOME RELATING TO EACH CATEGORY OF SHARES AS BUSINESS INCOME OR INCOME FROM CAPITAL GAINS AS THE CASE MAY BE, IN CONFORMIT Y WITH CIRCULAR NO.4 OF 2007 DATED 15.6.2007, AFTER GIVING ADEQUATE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE IN THE MATTER. THUS, THE ISSUE IS REMITTED BACK TO THE FILE OF THE ASSESSING OFFICER FOR VERIF YING THE CLAIMS MADE BY THE ASSESSEE. 4. THERE ARE NO OTHER CHANGES IN THE ORDER OF THE TRIBUNAL AND THE RESULT WILL REMAIN THE SAME. MA NOS. 93, 94 & 95/ HYD/2013 M/S SWARNIM MULTIVENTURES (P.) LTD. 4 5. IN THE RESULT, THE MAS FILED BY ASSESSEES ARE ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 23/08/2 013. SD/- SD/- - ASHA VIJAYARAGHAVAN JUDICIAL MEMBER SD/- CHANDRA POOJARI ACCOUNTANT MEMBER SD/-SD/- HYDERABAD, DATED THE 23 RD AUGUST, 2013 KV COPY TO:- 1) M/S SWARNIM MULTIVENTURES P. LTD., C/O M/S. P. MURALI & CO., CAS., 6-3-6755/2/3, 1 ST FLOOR, SOMAJIGUDA, HYDERABAD 82. 2) DCIT, CIRCLE 3(3), HYDERABAD. 3) THE CIT(A)-IV, HYDERABAD 4) THE CIT-IV, HYDERABAD 5) THE DEPARTMENTAL REPRESENTATIVE, I.T.A.T., HYDERABAD.