Shri Hirenbhai Jaswantrai Shah(Ind), Bhavnagar v. The Jt.CIT.,Range-2,, Bhavnagar

ITA 1267/AHD/2009 | 2005-2006
Pronouncement Date: 09-09-2011 | Result: Dismissed

Appeal Details

RSA Number 126720514 RSA 2009
Assessee PAN AFUPS1340G
Bench Ahmedabad
Appeal Number ITA 1267/AHD/2009
Duration Of Justice 2 year(s) 4 month(s) 19 day(s)
Appellant Shri Hirenbhai Jaswantrai Shah(Ind), Bhavnagar
Respondent The Jt.CIT.,Range-2,, Bhavnagar
Appeal Type Income Tax Appeal
Pronouncement Date 09-09-2011
Appeal Filed By Assessee
Order Result Dismissed
Bench Allotted A
Tribunal Order Date 09-09-2011
Date Of Final Hearing 01-09-2011
Next Hearing Date 01-09-2011
Assessment Year 2005-2006
Appeal Filed On 20-04-2009
Judgment Text
. .. . . .. . . .. . . .. .!'#$ !'#$ !'#$ !'#$ % % % % & & & & IN THE INCOME TAX APPELLATE TRIBUNAL : A BENCH : AHMEDABAD (BEFORE HONBLE SHRI T.K. SHARMA J.M. & HONBLE SHRI A.K.GARODIA A.M.) . ITA NO. 1267/AHD./2009 : ' ()- 2005-2006 SHRI HIRENBHAI JASWANTRAI SHAH BHAVNAGAR VS- J.C.I.T. RANGE-2 BHAVNAGAR (PAN : AFUPS 1340G) ( - /APPELLANT) ( ./ - /RESPONDENT ) - 0 1 / APPELLANT BY : SHRI M.K.PATEL A.R. ./ - 0 1 / RESPONDENT BY : SHRI KARTAR SINGH CIT D.R. 2'3 0 4% / DATE OF HEARING : 01/09/2011 5'( 0 4% / DATE OF PRONOUNCEMENT : 09/09/2011 / ORDER PER SHRI T.K. SHARMA JUDICIAL MEMBER : THIS APPEAL FILED BY THE ASSESSEE IS AGAINST THE O RDER DATED 16-12-2008 OF LEARNED COMMISSIONER OF INCOME TAX(APPEALS)-XX AHM EDABAD FOR THE ASSESSMENT YEAR 2005-2006. 2. THE ONLY GROUND RAISED BY THE ASSESSEE IN THE AP PEAL IS AS UNDER: 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E THE LD. CIT(A) ERRED GRAVELY IN LAW IN CONFIRMING THE TREATMENT (BY THE LD. AO) OF THE LOSS OF RS.1 12 214/- INCURRED BY THE APPELLANT IN DERIVATI VE TRANSACTIONS IN SHARES AS SPECULATION LOSS AS COVERED BY THE PROVISIONS OF S. 43(5) 3. WE HAVE HEARD BOTH THE SIDES. SHRI KARTAR SINGH THE LD. D.R. APPEARING ON BEHALF OF THE REVENUE POINTED OUT THAT THE CONTROV ERSY INVOLVED IN THIS APPEAL IS COVERED AGAINST THE ASSESSEE BY THE JUDGEMENT OF TH E ITAT KOLKATA SPECIAL BENCH IN THE CASE OF SHREE CAPITAL SERVICES LTD. VS- ACIT ( KOL) (SB) REPORTED IN 318 ITR PAGE 1(A.T.). IT IS PERTINENT TO NOTE THAT THE ITAT KOLKATA SPECIAL BENCH IN THE ABOVE CASE DISMISSING THE APPEAL OF THE ASSESSEE HELD T HAT THE TRANSACTION IN DERIVATIVES WAS A SPECULATIVE TRANSACTION AS PROVIDED UNDER SEC TION 43(5) AND THE TRANSACTION IN ITA NO. 1267-AHD-09 2 DERIVATIVES WAS NOT EXEMPTED FROM THE PURVIEW OF SP ECULATIVE TRANSACTION UNDER SECTION 43(5) AND THE ASSESSING OFFICER WAS RIGHT I N TREATING THE LOSS AS SPECULATION LOSS IN TERMS OF SECTION 43(5) OF THE INCOME-TAX AC T 1961. SHRI M.K.PATEL APPEARING ON BEHALF OF THE ASSESSEE COULD NOT CONTROVERT THE SAME. IT IS ALSO PERTINENT TO NOTE THAT THE ASSESSMENT YEAR INVOLVED IN THE PRESENT AP PEAL IS 2005-2006. THE LD. CIT(A) IN THE IMPUGNED ORDER IN PARA 3.3 HELD AS UNDER: 3.3 I HAVE CAREFULLY CONSIDERED THE CONTENTIONS O F THE LEARNED COUNSEL FOR THE APPELLANT AND HAVE ALSO CAREFULLY GONE THROUGH THE ASSESSMENT ORDER. THE CASE-LAW RELIED UPON BY THE LEARNED COUNSEL FOR THE APPELLAN T HAS ALSO BEEN CAREFULLY CONSIDERED. IT IS SEEN THAT AS AGAINST THE FINDINGS OF THE AO THE APPELLANT FAILED TO ESTABLISH AS TO HOW THE CONDITIONS LAID DOWN IN SEC TION 43(5) ARE FULFILLED SO AS TO TREAT THE TRANSACTIONS IN DERIVATIVES OTHER THAN SPECULAT IVE BUSINESS. THE TRANSACTIONS IN DERIVATIVES PERTAIN TO FINANCIAL YEAR 2004-05 AND T HE PROVISIONS LAID DOWN IN SECTION 43(5)(D) HAVE BEEN BROUGHT IN BY THE FINANCE ACT 2 005 WITH EFFECT FROM 1 ST APRIL 2006 AS AGAINST THE CONTENTION IN THIS REGARD RAISE D BY THE AO HAS NOT BEEN REBUTTED BY THE APPELLANT. ALSO IT HAS NOT BEEN CLARIFIED B Y THE APPELLANT THAT THE TRANSACTIONS HAVE BEEN MADE THROUGH RECOGNIZED STOCK EXCHANGE AN D THAT THE TRANSACTIONS ARC ELIGIBLE TRANSACTIONS. SINCE THIS BASIC CONDITION H AS NOT BEEN SATISFIED THE DISALLOWANCE OF LOSS OCCURRED ON ACCOUNT OF DERIVAT IVE TRANSACTIONS AND DISALLOWED BY THE AO IS HEREBY HELD TO BE JUSTIFIED. THIS GROUND OF APPEAL IS REJECTED. 3.1 KEEPING IN VIEW OF THE RATIO OF JUDGEMENT OF TH E ITAT KOLKATA SPECIAL BENCH IN THE CASE OF SHREE CAPITAL SERVICES LTD. ( SUPRA ) WE INCLINE TO UPHOLD THE ORDER OF THE LD. CIT(A). RESULTANTLY THE APPEAL OF THE ASSE SSEE IS DISMISSED. 4. IN THE RESULT THE APPEAL FILED BY THE ASSESSEE IS DISMISSED. 6 0 5'( #' ) 09 / 09 /2011 ' 7 0 !3 8 THIS ORDER PRONOUNCED IN COURT ON 09/09/2011. SD/- SD/- (A.K.GARODIA) (T.K. SHARMA) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 09/09/2011 ITA NO. 1267-AHD-09 3 0 00 0 .49 .49 .49 .49 :9(4) :9(4) :9(4) :9(4)- -- - 1. - 2. ./ - 3. 4 2> 4. 2>- - 5. 9A! .4' 8 6. !$ C6 D/ F 8 TALUKDAR/ SR. P.S.