Century Plyboards (India) Ltd., Kolkata v. ACIT, Circle - 11, Kolkata, Kolkata

ITA 1074/KOL/2010 | 2004-2005
Pronouncement Date: 29-02-2012 | Result: Dismissed

Appeal Details

RSA Number 107423514 RSA 2010
Assessee PAN AABCC1682J
Bench Kolkata
Appeal Number ITA 1074/KOL/2010
Duration Of Justice 1 year(s) 9 month(s) 4 day(s)
Appellant Century Plyboards (India) Ltd., Kolkata
Respondent ACIT, Circle - 11, Kolkata, Kolkata
Appeal Type Income Tax Appeal
Pronouncement Date 29-02-2012
Appeal Filed By Assessee
Order Result Dismissed
Bench Allotted A
Tribunal Order Date 29-02-2012
Date Of Final Hearing 01-06-2011
Next Hearing Date 01-06-2011
Assessment Year 2004-2005
Appeal Filed On 25-05-2010
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH: KOL KATA () BEFORE /AND . ! . '# ) [BEFORE SRI MAHAVIR SINGH JM & SHRI C. D. RAO AM] $ $ $ $ / I.T.A NO. 1074/KOL/2010 %& '( %& '( %& '( %& '(/ // / ASSESSMENT YEAR : 2004-05 CENTURY PLYBOARDS (INDIA) LTD. VS. ASSISTANT COMM ISSIONER OF INCOME-TAX (PAN: AABCC 1682 J) CIRCLE-11 KOLKATA. (*+ /APPELLANT ) ( -*+/ RESPONDENT ) & $ $ $ $ / I.T.A NO. 1152/KOL/2010 %& '( %& '( %& '( %& '(/ // / ASSESSMENT YEAR : 2004-05 DEPUTY COMMISSIONER OF INCOME-TAX VS. CENTURY PL YBOARDS (INDIA) LTD. CIRCLE-II KOLKATA. (*+ /APPELLANT ) ( -*+/ RESPONDENT ) DATE OF HEARING: 09.01.2012 DATE OF PRONOUNCEMENT: 29.02.2012 FOR THE ASSESSEE: SHRI A. K. TULSIYAN FOR THE REVENUE: SHRI D. R. SINDHAL '. / ORDER PER SHRI C. D. RAO AM/ . ! . '# : THESE CROSS APPEALS BY ASSESSEE AND REVENUE ARE ARI SING OUT OF ORDER OF CIT(A) DATED 16.03.2010 FOR ASSESSMENT YEAR 2004-05. 2. THE ASSESSEE IN ITS GROUNDS OF APPEAL HAS RAISE D THE FOLLOWING GROUNDS: 1) THAT THE LD. CIT(A) WAS ERRED IN CONFIRMING THE DISALLOWANCE OF DEDUCTION U/S 35(1)(II) OF I. TAX ACT RS. 1 25 000/- ON THE GROUN D THAT ASSESSEE FAILED TO FILE THE RENEWAL CERTIFICATE. SWAMI VIVEKANAND YOGA ANUSANDHANA SAMS THANA HAS APPLIED FOR RENEWAL WHICH IS STILL AWAITED. THERE IS NO FAULT OF THE AS SESSEE. HENCE DENIAL OF DEDUCTION U/S 35(I)(II) IS WRONG AND NEED TO BE ALLOWED. 2) THAT THE LD.CIT(A) WAS ERRED IN CONFIRMING THE D ISALLOWANCES OF RS.5 74 437/- OUT OF DONATION EXPENSES INCURRED BY THE ASSESSEE FOR RUNN ING THE BUSINESS ACTIVITIES SMOOTHLY. THE SAME HAS TO BE ALLOWED AS BUSINESS EXPENSES U/S 37(L) OF THE I TAX ACT. THE ADDITION NEED TO BE DELETED. 3) THAT THE LD.CIT(A) ERRED IN CONFIRMING THE ADDIT ION MADE BY THE A.O ON ACCOUNT OF SEC.14A OF THE I. TAX ACT. FOR EARNING DIVIDEND IN COME FOR EXPENSES 5% OF THE DIVIDEND INCOME AND INTEREST EXPENSES AS PER RULE-8D ON AD-H OC BASIS. THE LD. CIT(A) IGNORED THE ASSESSEES SUBMISSION OF HAVING INTEREST FREE F UNDS FOR INVESTMENT AS WELL AS NO EXPENSES INCURRED WITHOUT GIVING ANY REASONS. SUCH AD-HOC ADDITION CONFIRMED BY LD. CIT(A) NEED TO BE DELETED. 2 ITA 1074 & 1152/K/2010 CENTURY PLYBOARDS (INDIA) LTD. A.Y.2004-05 4) THAT THE LD. CIT(A) WAS ERRED IN CONFIRMING THE DISALLOWANCES OF BED DEBT WRITTEN OFF RS.36 4191-. THE SAME IS ALLOWABLE U/S 36. THE ADDI TION NEED TO BE DELETED. 3. AT THE OUTSET LD. COUNSEL FOR THE ASSESSEE STAT ED THAT ON INSTRUCTION FROM ASSESSEE NOT TO CONTEST THE GROUND NO. 1 IN RESPECT OF CONFIRMIN G THE DISALLOWANCE OF DEDUCTION U/S. 35(1) OF THE INCOME TAX ACT 1961 OF RS.1 25 000/- ON THE GR OUND THAT ASSESSEE FAILED TO FILE THE RENEWAL CERTIFICATE HE DID NOT WANT TO PRESS THIS GROUND. SINCE LD. DR HAS GOT NO OBJECTION TO THIS PRAYER OF ASSESSEES COUNSEL WE DISMISS THIS GROUN D OF APPEAL BEING NOT PRESSED. 4. THE SECOND ISSUE OF ASSESSEES APPEAL IS AGAINST THE ORDER OF CIT(A) IN CONFIRMING THE DISALLOWANCE OF RS.5 74 437/- OUT OF DONATION EXPEN SES INCURRED BY ASSESSEE FOR RUNNING THE BUSINESS ACTIVITIES SMOOTHLY. BRIEFLY STATED FACTS OF THE CASE ARE THAT ASSESSEE DEBITED TO THE P&L ACCOUNT A SUM OF RS.12 04 437/- AS DONATION UND ER THE HEAD MISC. EXPENSES. IN THE COMPUTATION OF INCOME THE ASSESSEE ADDED ONLY RS.6 30 000/-. HENCE THE BALANCE OF RS.5 74 437/- HAS ADDED BACK BY THE ASSESSING OFFIC ER IN THE TOTAL INCOME OF ASSESSEE IN THE ABSENCE OF ANY SATISFACTORY EXPLANATION. AGGRIEVED ASSESSEE PREFERRED APPEAL BEFORE LD. CIT(A) WHO CONFIRMED THE ACTION OF ASSESSING OFFIC ER. FURTHER AGGRIEVED ASSESSEE IS NOW IN APPEAL BEFORE US. 5. AT THE TIME OF HEARING LD. COUNSEL FOR THE ASSE SSEE WHILE REITERATING HIS SAME SUBMISSIONS AS SUBMITTED BEFORE THE LOWER AUTHORITI ES FURTHER SUBMITTED THAT THE ASSESSEE HAS ITS MANUFACTURING UNITS BRANCH OFFICES AND FOUR REGION AL OFFICES ACROSS INDIA. DURING THE COURSE OF ITS DAY TO DAY SMOOTH OPERATION AND FUNCTIONING OF THE BUSINESS ASSESSEE HAS TO PAY SUBSCRIPTION FOR SOUVENIRS TO THE LOCAL PEOPLE AND TO THE STAFF/WORKERS OF THE COMPANY. HE ALSO CONTENDED THAT IT IS A REAL AND COMMON FOR SMOOTH R UNNING OF DAY TO DAY BUSINESS ACTIVITIES. HENCE HE SUBMITTED THAT THE SAME HAS TO BE TREATE D AS BUSINESS EXPENSES AND IS ALLOWABLE U/S. 37 OF THE INCOME-TAX ACT 1961. IN SUPPORT OF HIS SUBMISSION HE RELIED ON THE DECISION OF HONBLE RAJASTHAN HIGH COURT IN THE CASE OF JAIPUR ELECTRO (P) LTD. (1997) 223 ITR 535 (RAJ). HE THEREFORE URGED BEFORE THE BENCH TO SET ASIDE THE ORDERS OF THE LOWER AUTHORITIES. 6. ON THE OTHER HAND LD. DR HEAVILY RELIED ON THE ORDERS OF THE LOWER AUTHORITIES AND URGED BEFORE THE BENCH TO CONFIRM THE SAME. HE ALS O CONTENDED THAT ASSESSEE WAS UNABLE TO PROVIDE ANY SATISFACTORY EXPLANATION IN RESPECT OF THE EXPENDITURE INCURRED BY IT AS DONATION AND CLAIMING THE SAME AS EXPENSES TO BE ALLOWED U/S. 37 (1) OF THE I. T. ACT 1961. HENCE IN THE ABSENCE OF ANY SATISFACTORY EXPLANATION THE ASSESSI NG OFFICER HAS RIGHTLY MADE THE ADDITION AND CONSEQUENTLY THE ACTION OF LD. CIT(A) CONFIRMIN G THE SAME MAY BE UPHELD. 3 ITA 1074 & 1152/K/2010 CENTURY PLYBOARDS (INDIA) LTD. A.Y.2004-05 7. WE HAVE HEARD RIVAL SUBMISSIONS AND GONE THROUGH FACTS AND CIRCUMSTANCES OF THE CASE. WE FIND THAT IN THE ABSENCE OF ANY SATISFACTORY EXP LANATION THE ASSESSING OFFICER HAS ADDED THE SUM OF RS.5 74 437/- IN RESPECT OF DONATION EXPENSE S AS CLAIMED BY THE ASSESSEE. IN APPEAL LD. CIT(A) ALSO CONFIRMED THIS ACTION OF ASSESSING OFFI CER BY OBSERVING AS UNDER: I HAVE CAREFULLY CONSIDERED THE SUBMISSIONS OF THE APPELLANT. FROM THE DETAILS FILED IT IS SEEN THAT SMALL PAYMENTS WERE MADE TO SOUVENIRS AND OTHERS. IT IS STATED THAT IN THE COURSE OF APPELLANTS DAY TO DAY SMOOTH OPERATION A ND FUNCTIONING OF BUSINESS THE APPELLANT HAD TO PAY SUBSCRIPTION FOR SOUVENIRS TO THE LOCAL PEOPLE AND TO STAFF/WORKERS OF THE COMPANY. I AM NOT CONVINCED WITH THE APPELLANT S SUBMISSIONS. THE APPELLANT HAS NOT SUBSTANTIATED AS TO HOW THE EXPENSES INCURRED A RE IN THE COURSE OF BUSINESS AND ARE INCIDENTAL TO BUSINESS. THERE IS NO DOUBT THAT BUS INESSMAN IS THE BEST JUDGE TO DETERMINE THE BUSINESS EXPEDIENCY. HOWEVER IN THE PRESENT C ASE IT IS NOT EXPLAINED AS TO HOW THE AFORESAID EXPENSES NECESSITATED FOR BUSINESS EXPEDI ENCY. AS SUCH I DECLINE TO INTERFERE WITH THE ACTION OF THE A.O. THE ADDITION IS CONFIRM ED. BEFORE US ALSO THE ASSESSEE WAS UNABLE TO PROVIDE A NY EVIDENCE IN SUPPORT OF HIS CLAIM FOR INCURRING THE EXPENDITURE ON DONATION PURPOSE. IN VIEW OF THE ABOVE WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF THE LD. CIT(A) AND THE SA ME IS HEREBY UPHELD. THIS GROUND OF APPEAL OF ASSESSEE IS DISMISSED. 8. GROUND NO. 3 OF ASSESSEE IS AGAINST THE ORDER O F LD. CIT(A) IN RESPECT OF CONFIRMING THE ADDITION MADE BY ASSESSING OFFICER U/S. 14A OF THE I. T. ACT 1961 FOR EARNING DIVIDEND INCOME FOR EXPENSES 5% OF THE DIVIDEND INCOME AND INTEREST EXPENSES AS PER RULE 8D ON AD HOC BASIS. WE FIND THAT HONBLE BOMBAY HIGH COURT IN THE CASE OF GODREJ & BOYCE MFG. CO. LTD. (SUPRA) HAS ALREADY HELD THAT APPLICABILITY OF RULE 8D OF THE RULES IS PROSPECTIVE AND NOT RETROSPECTIVE W.E.F. ASSESSMENT YEAR 2008-09 WHERE IN HONBLE HIGH COURT HAS ALSO DIRECTED TO RECOMPUTE DISALLOWANCE IN CASE THERE IS A NEXUS FOR EXPENSES WITH EXEMPT INCOME BY LAYING DOWN THE PRINCIPLE AS UNDER: (V) THE PROVISIONS OF RULE 8D OF THE INCOME-TAX RU LES WHICH HAVE BEEN NOTIFIED WITH EFFECT FROM MARCH 24 2008 SHALL APPLY WITH E FFECT FROM THE ASSESSMENT YEAR 2008-09; (VI)EVEN PRIOR TO THE ASSESSMENT YEAR 2008-09 WHE N RULE 8D WAS NOT APPLICABLE THE ASSESSING OFFICER HAS TO ENFORCE TH E PROVISIONS OF SUB-SECTION (1) OF SECTION 14A. FOR THAT PURPOSE THE ASSESSING OFF ICER IS DUTY BOUND TO DETERMINE THE EXPENDITURE WHICH HAS BEEN INCURRED I N RELATION TO INCOME WHICH DOES NOT FORM PART OF THE TOTAL INCOME UNDER THE AC T. THE ASSESSING OFFICER MUST ADOPT A REASONABLE BASIS OR METHOD CONSISTENT WITH ALL THE RELEVANT FACTS AND CIRCUMSTANCES AFTER FURNISHING A REASONABLE OPPORTU NITY TO THE ASSESSEE TO PLACE ALL GERMANE MATERIAL ON THE RECORD; (VII) THE PROCEEDINGS FOR THE ASSESSMENT YEAR 2002 -03 SHALL STAND REMANDED BACK TO THE ASSESSING OFFICER. THE ASSESSING OFFICE R SHALL DETERMINE AS TO WHETHER THE ASSESSEE HAS INCURRED ANY EXPENDITURE ( DIRECT OR INDIRECT) IN RELATION TO DIVIDEND INCOME/INCOME FROM MUTUAL FUNDS WHICH D OES NOT FORM PART OF THE TOTAL INCOME AS CONTEMPLATED UNDER SECTION 14A. THE ASSESSING OFFICER CAN ADOPT REASONABLE BASIS FOR EFFECTING THE APPORTIONM ENT. WHILE MAKING THAT DETERMINATION THE ASSESSING OFFICER SHALL PROVIDE A REASONABLE OPPORTUNITY TO 4 ITA 1074 & 1152/K/2010 CENTURY PLYBOARDS (INDIA) LTD. A.Y.2004-05 THE ASSESSEE OF PRODUCING ITS ACCOUNTS AND RELEVANT AND GERMANE MATERIAL HAVING A BEARING ON THE FACTS AND CIRCUMSTANCES OF THE CAS E WE FURTHER FIND THAT THE TRIBUNAL KOLKATA BENCH ON THE SELF SAME FACTS IN THE CASE OF SAGRIKA GOODS & SERVICES PVT. LTD. VS. INCOME-TAX OFFICER I.T.A NO. 1278/KOL/2010 ASSESSMENT YEAR 2005-06 DATED 24 TH SEPTEMBER 2010 HAS HELD AS UNDER: 5. HEARD THE RIVAL SUBMISSIONS PERUSED THE MATERIAL A VAILABLE ON RECORD AND THE DECISIONS RELIED ON BY THE LD. AUTHORISED REPRE SENTATIVE OF THE ASSESSEE CITED SUPRA. WE FIND THAT ON THE ISSUE OF DISALLOWANCE U/ S. 14A THIS BENCH OF THE TRIBUNAL HAS BEEN TAKING A CONSISTENT VIEW THAT THIS DISALLO WANCE SHOULD BE RESTRICTED TO 1% OF DIVIDEND INCOME. FOLLOWING THE SAME IN THIS AP PEAL ALSO WE HOLD THAT THE DISALLOWANCE U/S 14A FOR EARNING EXEMPT DIVIDEND IN COME SHOULD BE RESTRICTED TO 1% OF DIVIDEND INCOME. THE ASSESSING OFFICER IS AC CORDINGLY DIRECTED TO DO SO AND WORK OUT THE QUANTUM OF DISALLOWANCE. THIS GROUND OF APPEAL OF THE ASSESSEE IS ALLOWED AS DIRECTED ABOVE. IN VIEW OF THE ABOVE AND RESPECTFULLY FOLLOWING THE AFORESAID DECISION OF JURISDICTION TRIBUNAL (CITED SUPRA) WE RESTRICT THE DISALLOWANCE AT 1% OF EXPENSES BY SETTING ASIDE THE ORDER OF CIT(A). WE ORDER ACCORDINGLY. 9. GROUND NO. 4 OF ASSESSEE IS AGAINST THE ORDER OF CIT(A) IN CONFIRMING THE DISALLOWANCES OF BAD DEBT WRITTEN OFF RS.36 419/-. BRIEFLY STATE D FACTS OF THE CASE ARE THAT THE ASSESSING OFFICER OBSERVED THAT THE ASSESSEE HAS CLAIMED BAD DEBTS OF RS. NIL IN THE P&L ACCOUNT. IN THE DETAILS OF MISCELLANEOUS EXPENSES HOWEVER THE ASS ESSEE HAS WRITTEN OFF BAD DEBTS OF RS.36 419/-. HE ALSO OBSERVED THAT ASSESSEE DID NO T FILE ANY SATISFACTORY DETAILS AND THE ASSESSEE HAS ALSO TO SATISFY THAT THE AMOUNTS WRITT EN OFF WERE CREDITED IN EARLIER YEAR. SINCE THE ASSESSEE HAD NOT DONE SO ASSESSING OFFICER DISALLO WED THE SAME. IN APPEAL LD. CIT(A) CONFIRMED THE ACTION OF THE ASSESSING OFFICER BY OB SERVING THAT FROM THE COPIES OF THE LEDGER ACCOUNT IT IS SEEN THAT THERE ARE NUMEROUS SMALL AM OUNTS PERTAINING TO VARIOUS DEBTORS WRITTEN OFF. THE RELATED DETAILS ARE ALSO GIVEN IN THE NAR RATION WHILE PASSING THE ENTRIES IN THE LEDGER. HOWEVER NO EVIDENCES HAVE BEEN PRODUCED TO ESTABLI SH THE PERIOD OF CREDIT GIVEN IN THE EARLIER YEAR ACCOUNTS. SINCE THE LD. COUNSEL FOR THE ASSESS EE BEFORE US ALSO UNABLE TO PRODUCE ANY SUCH DETAILS REBUTTING THE FINDINGS OF THE LOWER AUTHORI TIES WE DO NOT FIND ANY INFIRMITY IN THE ORDERS PASSED BY THE LOWER AUTHORITIES AND THE SAME IS HER EBY UPHELD. THIS GROUND OF APPEAL OF ASSESSEE IS ALSO DISMISSED. 7. THE ONLY GROUND RAISED BY THE REVENUE IN ITS APP EAL IS AS UNDER: ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE LD. CIT(A) HAS ERRED IN DIRECTING TO ALLOW LOSSES CLAIMED BY THE ASSESSEE IN RESPECT OF MUTUAL FUND AND SHARES THOUGH THE ASSESSEE HAS FAILED TO FURNISH THE DATE OF PURCHASE AND SALE NAME AND ADDRESS OF THE PARTIES TO WHOM SOLD AND RELEVANT QUOTATIONS ON THE DATE OF PURCHASE AND SALE. 5 ITA 1074 & 1152/K/2010 CENTURY PLYBOARDS (INDIA) LTD. A.Y.2004-05 8. BRIEFLY STATED FACTS OF THE CASE ARE THAT THE AS SESSING OFFICER FOUND THAT THE ASSESSEE HAS CLAIMED LOSS IN SHARE DEALING OF RS.29 47 927/- AND LOSS IN DEALING OF MUTUAL FUND OF RS.39 62 683/-. THE ASSESSING OFFICER DISALLOWED S UCH LOSSES ON THE GROUND THAT THE ASSESSEE HAS NOT RECONCILED THE TOTAL GAIN OR LOSS ON SALE O F INVESTMENTS AS SHOWN IN THE STATEMENT AND AS SHOWN IN THE ACCOUNTS. COMPLETE SUPPORTING DOCUMEN TS FOR PURCHASE AND SALE OF INVESTMENTS WERE NOT PRODUCED FOR VERIFICATION. THE ASSESSEE A LSO HAS NOT SATISFACTORILY PROVED THE DATE OF PURCHASE DATE OF SALE NAME AND ADDRESS OF PARTIES FROM WHOM PURCHASE WERE MADE NAME AND ADDRESS OF THE PARTIES TO WHOM SOLD AND RELEVANT QU OTATIONS ON THE DATE OF PURCHASE AND ON DATE OF SALE. IN THE BALANCE SHEET AND P&L ACCOUNT THE ASSESSEE HAS SHOWN IT AS INVESTMENTS. HOWEVER THE AUDITORS IN THEIR REPORT (PAGE 21 OF T HE ACCOUNTS IN ITEM NO. XIV HAVE STATED THAT THE COMPANY IS DEALING/TRADING IN SHARES. IF THE C OMPANY IS DEALING OR TRADING IN THE SHARES THEN INCOME OR LOSS WILL BE BUSINESS LOSS/BUSINESS GAIN. IF THE COMPANY IS ONLY MAKING INVESTMENTS THEN IT WILL BE CAPITAL GAIN. THE POSIT ION IS NOT CLEARLY EXPLAINED. HENCE THERE IS NO OPTION BUT TO DISALLOW THE SAID LOSS ON SALE OF CUR RENT INVESTMENTS AS CLAIMED BY THE ASSESSEE IN ABSENCE OF SATISFACTORY EXPLANATION. IN APPEAL LD . CIT(A) ALLOWING ASSESSEES GROUND OF APPEAL DIRECTED THE ASSESSING OFFICER TO ALLOW THE CLAIM OF LOSSES MADE BY THE ASSESSEE. AGGRIEVED REVENUE IS IN APPEAL BEFORE US. 9. AT THE TIME OF HEARING BEFORE US LD. DR HEAVILY RELIED ON THE ORDER OF ASSESSING OFFICER AND URGED BEFORE THE BENCH FOR SETTING ASID E THE ORDER OF LD. CIT(A) AND RESTORE THAT OF THE ASSESSING OFFICER. 10. ON THE OTHER HAND LD. COUNSEL FOR THE ASSESSEE WHILE REITERATING HIS SAME SUBMISSIONS AS SUBMITTED BEFORE THE LOWER AUTHORITIES RELIED ON THE ORDER OF LD. CIT(A) AND SUBMITTED THAT THE ACTION OF LD. CIT(A) IN THIS REGARD MAY BE UPHE LD. 11. WE HAVE HEARD RIVAL SUBMISSIONS AND GONE THROUG H THE MATERIAL AVAILABLE ON RECORD AND THE ORDERS OF THE LOWER AUTHORITIES. WE FIND THAT THE LD. CIT(A) HAS DEALT THE ISSUE AS UNDER: I HAVE CAREFULLY CONSIDERED THE APPELLANTS SUBMIS SIONS WITH REFERENCE TO THE FACTS OF THE CASE. AS REGARDS GROUND NO. 5 RELATED TO DISAL LOWANCE OF LOSS OF RS.39 62 683/- IN MUTUAL FUND. THE A.O. ALLEGED IN THE ASSESSMENT OR DER THAT ALTHOUGH THE BALANCE SHEET AND PROFIT & LOSS A/C OF THE APPELLANT COMPANY REFL ECTED SHARES/MF AS INVESTMENT IN NATURE BUT THE AUDITORS REPORT STATED THAT THE COM PANY IS DEALING/TRADING IN SHARES. THE A.O. THEREFORE OPINED THAT HE LOSS FROM SALE OF SHARES (DEALT BY THE APPELLANT ITSELF) OF RS.29 47 927/- AND LOSS FROM DEALING IN MF OF RS .39 62 683/- CAN NOT THUS BE CLAIMED AS SHORT TERM CAPITAL LOSS. I HAVE CONSIDERED THE A.OS OBSERVATION WITH REFER ENCE TO FACTS OF THE CASE. IF THE A.OS CONTENTION IS ACCEPTED THEN PROFIT ON DEALIN G IN SHARES THROUGH SMIFS OF RS.63 83 364/- NEEDS ALSO TO BE NOT TREATED AS SHOR T TERM CAPITAL GAIN BUT A TRADING 6 ITA 1074 & 1152/K/2010 CENTURY PLYBOARDS (INDIA) LTD. A.Y.2004-05 INCOME. IN ANY CIRCUMSTANCES IF SHORT TERM CAPITA L GAIN ON DEALING IN SHARES THROUGH SMIFS IS ACCEPTABLE BY THE A.O. CORRESPONDING LOSSE S NEEDS TO BE SET OFF WITH THE GAIN. THE A.O. HIMSELF HAS ACCEPTED THE APPELLANTS CLAI M OF TREATMENT OF LONG TERM CAPITAL GAINS. HENCE ON SAME FACTS AND CIRCUMSTANC ES TWO DIFFERENT APPROACHES COULD NOT BE TAKEN. ACCORDINGLY IN EITHER MANNER BE IT T RADING INCOME (BUSINESS)/CAPITAL GAIN (INVESTMENT) THE LOSSES INCURRED OF RS.29 47 927/- AND RS.39 62 683/- NEED TO BE SET OFF WITH GAINS OF RS.63 83 364/- ON DEALING THROUGH SMI FS. THERE I DIRECT THE A.O. TO ALLOW THE CLAIM OF LOSSES MADE BY THE A.O. THE APPE LLANTS GROUND IS ALLOWED. WE FIND THAT THE ASSESSING OFFICER HAS HIMSELF ACCE PTED THE ASSESSEES CLAIM OF TREATMENT OF LONG TERM CAPITAL GAINS. HENCE ON SAME FACTS AND CIRCUMSTANCES TWO VIEWS ARE NOT POSSIBLE. ACCORDINGLY THE LD. CIT(A) DIRECTED THE ASSESSING OFFICER TO ALLOW THE CLAIM OF LOSSES INCURRED OF RS.29 47 927/- AND RS.39 62 683/- TO BE SET OFF WITH GAINS OF RS.63 83 364/-. SINCE DURING THE COURSE OF HEARING BEFORE US LD. DR COUL D NOT BE ABLE TO CONTROVERT THE AFORESAID FINDING OF LD. CIT(A) BY PRODUCING ANY COGENT MATER IAL WE DO NOT FIND ANY INFIRMITY IN THE SAID ORDER OF LD. CIT(A) AND THE SAME IS HEREBY UPH ELD. REVENUES GROUND OF APPEAL IS DISMISSED. 12. IN THE RESULT BOTH THE APPEAL OF ASSESSEE AS W ELL AS REVENUE ARE DISMISSED. 13. ORDER PRONOUNCED IN OPEN COURT ON 29.02.2012. SD/- SD/- . ! ! ! ! . '# (MAHAVIR SINGH) (C. D. RAO) JUDICIAL MEMBER ACCOUNTANT MEMBER ( !# !# !# !#) )) ) DATED : 29TH FEBRUARY 2012 /0 %12 3 JD.(SR.P.S.) '. 4 5 6'5'7- COPY OF THE ORDER FORWARDED TO: 1 . *+ / APPELLANT CENTURY PLYBOARDS (INDIA) LTD. 6 LYON S RANGE KOLKATA-700 001. 2 -*+ / RESPONDENT ACIT/DCIT CIRCLE-11 KOLKATA. 3 . .% ( )/ THE CIT(A) KOLKATA 4. .% / CIT KOLKATA 5 . >? % / DR KOLKATA BENCHES KOLKATA -5 / TRUE COPY '.%@/ BY ORDER 2 /ASSTT. REGISTRAR .