Venkatesh Sharma , Raichur v. Income Tax Officer Ward-4 , Raichur

ITA 3262/BANG/2018 | 2010-2011
Pronouncement Date: 10-03-2021 | Result: Allowed

Appeal Details

RSA Number 326221114 RSA 2018
Assessee PAN BHDPS4392E
Bench Bangalore
Appeal Number ITA 3262/BANG/2018
Duration Of Justice 2 year(s) 3 month(s) 4 day(s)
Appellant Venkatesh Sharma , Raichur
Respondent Income Tax Officer Ward-4 , Raichur
Appeal Type Income Tax Appeal
Pronouncement Date 10-03-2021
Appeal Filed By Assessee
Tags 10(38)
Order Result Allowed
Bench Allotted A
Tribunal Order Date 10-03-2021
Date Of Final Hearing 10-03-2021
Next Hearing Date 10-03-2021
Last Hearing Date 15-10-2019
First Hearing Date 08-12-2020
Assessment Year 2010-2011
Appeal Filed On 06-12-2018
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH : BANGALORE BEFORE SHRI CHANDRA POOJARI ACCOUNTANT MEMBER AND SMT. BEENA PILLAI JUDICIAL MEMBER IT A NO. 3262/ BANG / 2018 ASSESSMENT YEAR: 2010 - 11 SHRI VENKATESH SHARMA 3-10-143/2 NEAR JAIN TEMPLE RAICHUR 584 101. PAN: BHDPS 4392E VS. THE INCOME TAX OFFICER WARD 4 RAICHUR. APPELLANT RESPONDENT APPELLANT BY : S HRI RAJKUMAR HANCHNAL CA RESPONDENT BY : SHRI KANNAN NARAYANAN JT.CIT(DR)(ITAT) BENGALURU. DATE OF HEARING : 10.03 .202 1 DATE OF PRONOUNCEMENT : 10.03 .202 1 O R D E R PER CHANDRA POOJARI ACCOUNTANT MEMBER THIS APPEAL IS DIRECTED AGAINST THE ORDER OF CIT( APPEALS) DATED 25.10.2018 FOR THE ASSESSMENT YEAR 2010-11 ON THE FOLLOWING GROUNDS:- 1. ON THE FACTS AND CIRCUMSTANCE OF THE APPELLANT THE LEARNED CIT(A) HAS ERRED IN LAW AND FACTS IS NOT JUSTIFIED IN SUSTAINING THE ADDITION OF RS. 44 78 676/- BEING TH E GAIN ON SALE OF LONG TERM ASSET (SHARES). 2. ON THE FACTS AND CIRCUMSTANCE OF THE APPELLANT THE ORDERS OF THE LOWER AUTHORITIES ARE OPPOSED TO LAW EQUITY W EIGHT OF EVIDENCE AND PROBABILITIES. 3. ON FACTS AND CIRCUMSTANCE OF THE CASE THE LEARN ED AUTHORITY OUGHT TO HAVE TREATED RS. 44 78 676/-BEING THE GAIN ON SALE OF LONG TERM ASSET (SHARES) INSTEAD OF BUSINESS INCOME MORE SO ITA NO.3262/BANG/2018 PAGE 2 OF 5 WHEN THE APPELLANT HAS PURCHASED SUCH SHARES DURING 1999- 2000 CONVERTED INTO DE-MAT ACCOUNT DURING 2006-07 IN SPITE OF FILING SUBSTANTIAL DOCUMENTS TO SUPPORT THE CLAI M. 4. ON FACTS AND CIRCUMSTANCE OF THE CASE THE ORDE R OF THE LEARNED AUTHORITY IS AGAINST THE CIRCULAR NO.6 OF 2 016 DATED 29.02.2016 AND EARLIER CIRCULAR NO.4/2007 DATED: 15 .06.2007 AND EARLIER CIRCULAR NO. 1827 DATED: 31.08.1989 ISS UED BY THE CBDT WHICH EMPHASIS THAT TAX PAYER CAN HAVE TWO POR T FOLIOS I.E. AN INVESTMENT PORT FOLIO CONSISTING OF SECURITIES WHICH ARE TO BE TREATED AS CAPITAL ASSET AND TRADIN G PORT FOLIO COMPRISING OF STOCK IN TRADE WHICH ARE TO BE TREATE D AS TRADING ASSET. 5. ON FACTS AND CIRCUMSTANCE OF THE CASE THE ORDE R OF THE LEARNED AUTHORITY IS AGAINST THE PROVISIONS OF SECT ION 43(5) OF THE ACT WHICH SPECIFICALLY STATES AT CLAUSE (D) THA T PURCHASE OR SALE OF /TRADING CARRIED OUT AT RECOGNISED STOCK EX CHANGE SHALL NOT BE TREATED AS SPECULATIVE TRANSACTION. 6. ON FACTS AND CIRCUMSTANCE OF THE CASE THE ORDER OF THE LEARNED AUTHORITY IS AGAINST THE RATIO OF LAW LAID DOWN BY HON'BLE APEX COURT HIGH COURTS AND INCOME TAX APPE LLATE TRIBUNAL OF VARIOUS STATES IN SO FAR AS THEY RELAT E TO MAINTENANCE OF TWO PORT FOLIOS CLASSIFICATION OF S UCH PORT FOLIO PER SE INTENTION OF THE ASSESSEE IRRESPECTIVE OF THE ENTRIES MADE IN THE BOOKS OF ACCOUNTS. A) CIT V/S EXCELL INDUSTRIES LTD (2013) 262 CTR (SC) 261. B) CIT V/S GOPAL PUROHIT (2010) 228 CTR (BOM) 582. C) CIT V/S EXPRESS SECURITIES PVT LTD (2014) 272 CTR (DEL) 294. D) CIT V/S.H K FINANCIERS PVT LTD (2015) 61 TAXMAN 175 (CAL). E) ASSISTANT COMMISSIONER OF INCOME TAX V/S.SACHIN R TENDULKAR (2017) 184 TTJ (MUMBAI) 374. F) ANKUR SCIENTIFIC ENERGY TECHNOLOGIES (P) LTD V/S DEPUTY COMMISSIONER OF INCOME TAX (2017) 188 TTJ (AHD) 120. ITA NO.3262/BANG/2018 PAGE 3 OF 5 7. ON THE FACTS AND CIRCUMSTANCE OF THE CASE THE L EARNED AUTHORITY OUGHT TO HAVE HELD THAT THE ENTRIES IN TH E BOOKS OF ACCOUNTS DO NOT OVER RIDE THE PROVISIONS OF INCOME TAX LAW AS HELD BY THE SUPREME COURT IN. THE CASE CIT V/S TUTI CORIN ALKALI CHEMICALS AND FERTILISERS LTD (1997) 227 ITR 172 (SC).AND ALSO CIT V/S ARVIND PRAKASH MALPANI ITA NO.1131 OF 2006 (HC) KAR. 8. ON THE FACTS AND CIRCUMSTANCE OF THE CASE THE LEARNED AUTHORITY OUGHT TO HAVE FOLLOWED THE PRINCIPAL OF C ONSISTENCY IN HOLDING DUAL PORTFOLIO BY THE APPLICANT AS IN TH E PREVIOUS YEARS THE FINDING IS AGAINST RATIO OF LAW IN THE C ASE OF CIT V/S. RADHASOAMI SATSANG (1991) 100 CTR (SC) 267. 9. THE APPELLANT CRAVES TO LEAVE TO ADD ALTER OR D ELETE OR SUBSTITUTE ANY OF THE GROUNDS OF APPEAL AT THE TIM E OF THE HEARING OF THE APPEAL. 2. IN THIS CASE ASSESSMENT WAS COMPLETED U/S. 143( 3) OF THE INCOME- TAX ACT 1961 [THE ACT] DETERMINING TOTAL INCOME OF ASSESSEE AT RS.5 66 360 AS AGAINST RETURNED INCOME OF RS.2 94 790. THE CIT INVOKING THE PROVISIONS OF SECTION 263 OF THE ACT WAS OF THE VIE W THAT ASSESSEE INDULGED IN BUYING AND SELLING OF SHARES AND EARNED PROFIT O F RS.44 76 676. THE SAME WAS CLAIMED AS EXEMPT U/S. 10(38) OF THE ACT. THEREFORE THE CIT VIDE IMPUGNED ORDER DIRECTED THE AO TO REFRAME THE ASSESSMENT. AGAINST THIS ORDER OF CIT THE ASSESSEE WENT IN APPEAL BEFO RE THE TRIBUNAL AND THE TRIBUNAL CONFIRMED THE ORDER OF CIT U/S. 263 OF THE ACT. 3. AS SUCH THE AO IN HIS ORDER U/S. 143(3) R.W.S. 263 DENIED EXEMPTION U/S. 10(38) OF THE ACT AND TREATED IT AS LONG TERM CAPITAL GAIN AT RS.44 78 676. AGAINST THIS THE ASSESSEE IS IN APP EAL BEFORE US. 4. NOW THE CONTENTION OF THE ASSESSEE IS THAT IT PU RCHASED THE IMPUGNED SHARES IN THE YEAR 1999-2000 AND CONVERTED IT INTO DEMAT ACCOUNT DURING THE YEAR 2006-07 AS SUCH NO ADVERSE INFERENCE COULD BE DRAWN AGAINST THE ASSESSEE. ITA NO.3262/BANG/2018 PAGE 4 OF 5 5. ON THE OTHER HAND THE LD. DR SUBMITTED THAT ASS ESSEE HAS NOT BROUGHT THE NECESSARY EVIDENCE ON RECORD IN RESPECT OF ITS CLAIM THAT SHARES WERE PURCHASED IN THE YEAR 1999-2000. AS SU CH HE RELIED ON THE ORDER OF THE LOWER AUTHORITIES. 6. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE M ATERIAL ON RECORD. IN THIS CASE THE ASSESSEE HAS NOT PRODUCED THE REQ UISITE EVIDENCE TO SHOW THAT HE HAS PURCHASED THE SHARES IN THE YEAR 1999-2 000. BEING SO IN OUR OPINION IT IS PROPER TO REMIT THE ISSUE IN DISPUTE TO THE FILE OF AO WITH A DIRECTION TO THE ASSESSEE TO SUBSTANTIATE ITS CLAIM THAT HE PURCHASED THE SHARES IN 1999-2000 BY PRODUCING THE COPIES OF CERT IFICATES IN PHYSICAL FORM AND ALSO MEMBERS REGISTER WITH SHILPA MEDICARE LTD. AT THE RELEVANT POINT OF TIME SUPPORTED BY REQUISITE STATUTORY FORMS FILE D BY SHILPA MEDICARE LTD. BEFORE THE CONCERNED REGISTRAR OF COMPANIES. WITH THESE OBSERVATIONS THE ISSUE IS RESTORED TO THE AO FOR FRESH CONSIDERA TION AFTER AFFORDING OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. 7. IN THE RESULT THE APPEAL OF THE ASSESSEE IS TR EATED AS ALLOWED FOR STATISTICAL PURPOSES. PRONOUNCED IN THE OPEN COURT ON THIS 10 TH DAY OF MARCH 2021. SD/- SD/- ( BEENA PILLAI ) ( CHANDRA POOJARI ) JUDICIAL MEMBER ACCOUNTANT MEMBER BANGALORE DATED THE 10 TH MARCH 2021. / DESAI S MURTHY / ITA NO.3262/BANG/2018 PAGE 5 OF 5 COPY TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR ITAT BANGALORE. BY ORDER ASSISTANT REGISTRAR ITAT BANGALORE.