ALMATH TEXTILES P. LTD, MUMBAI v. DCIT 6(1), MUMBAI

ITA 5129/MUM/2015 | 2006-2007
Pronouncement Date: 19-10-2016 | Result: Allowed

Appeal Details

RSA Number 512919914 RSA 2015
Assessee PAN AABCA0608C
Bench Mumbai
Appeal Number ITA 5129/MUM/2015
Duration Of Justice 11 month(s) 21 day(s)
Appellant ALMATH TEXTILES P. LTD, MUMBAI
Respondent DCIT 6(1), MUMBAI
Appeal Type Income Tax Appeal
Pronouncement Date 19-10-2016
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted SMC
Tribunal Order Date 19-10-2016
Assessment Year 2006-2007
Appeal Filed On 28-10-2015
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL BENCH H MUMBAI BEFORE SHRI R.C.SHARMA ACCOUNTANT MEMBER AND SHRI PAWAN SINGH JUDICIAL MEMBER ITA NO.5129/MUM/2015 (ASSESSMENT YEAR : 2006-07) ALMATH TEXTILES PVT. LTD. 11/A HARI BHAVAN 3 RD FLOOR ZAVER ROAD NEXT TO JAIN TEMPLE MULUND (W) MUMBAI-400080. PAN: AABCA0608C VS. DCIT-6(1) AAYAKAR BHAVAN MUMBAI-400020. (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI VIMAL PUNMIYA (AR) REVENUE BY : SHRI K.C. KANOJIA (DR) DATE OF HEARING : 17.10.2016 DATE OF PRONOUNCEMENT : 19.10.2016 O R D E R PER PAWAN SINGH JM: 1. THIS APPEAL U/S 253 OF THE INCOME-TAX ACT IS DIRECT ED BY THE ASSESSEE AGAINST THE ORDER OF CIT(A)-12 MUMBAI DATED 04.08.2015 FOR ASSESSMENT YEAR (AY) 2007-08. THOUGH THE ASSESSEE HAS RAISED AS MANY AS THREE GROUNDS OF APPEAL BUT AS PER OUR CONSIDERED OPINION ONLY SUBSTANTIAL GROUND OF APPEAL IS THAT WHETHER THE LD. CIT(A) ERRED BY ALLOWING THE LONG T ERM CAPITAL GAIN (LTCG) FROM SALES OF INVESTMENT AS UNEXPLAINED CASH CREDIT. 2. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE IS EN GAGED IN THE BUSINESS OF TRADING IN TEXTILE AS WELL AS INVESTMENT IN SHARES FILED RETURN OF INCOME FOR RELEVANT AY ON 12.12.2006 DECLARING TOTAL LOSS OF ( -) 2667/-. THE RETURN OF INCOME WAS SELECTED FOR SCRUTINY AND WHILE FRAMING THE ASSESSMENT THE ASSESSING OFFICER (AO) MADE THE ADDITION OF RS. 45 45 853/- U/S 68 OF THE ACT HOLDING THAT THE TRANSACTION OF SALE OF SHARE APPEA RS TO BE NON-GENUINE AND 2 ITA NO. 5129/M/2015- ALMATH TEXTILES PVT. LTD. TREATED THE SAME AS UNEXPLAINED CASH CREDIT. AGGRIE VED BY THE ORDER OF AO THE ASSESSEE FILED APPEAL BEFORE THE CIT(A) BUT THE SAM E WAS DISMISSED HENCE THIS APPEAL HAS BEEN FILED BEFORE US. 3. WE HAVE HEARD THE LD. AUTHORIZED REPRESENTATIVE (AR ) OF THE ASSESSEE AND LD. DEPARTMENTAL REPRESENTATIVE (DR) FOR THE REVENUE AN D PERUSED THE MATERIAL AVAILABLE ON RECORD. LD. AR OF THE ASSESSEE ARGUED THAT IN THE ASSESSMENT THE ASSESSEE CLAIMED LTCG OF RS. 45 45 853/- ON THE SAL ES OF SHARES OF RELIANCE INDUSTRIES AND ALOK INDUSTRIES LTD. THE AO ASKED TH E ASSESSEE TO FILE COPY OF CONTRACT NOTE AND COPY OF DMAT A/C. ASSESSEE HAS EX PLAINED THAT SHARES WERE SOLD IN PHYSICAL FORM AND NOT IN DMAT FORM. THE AO SEEKS INFORMATION FROM THE STOCK EXCHANGE AS WELL AS FROM BROKER DESPITE C ONFIRMATION FROM EXCHANGE AND BROKER THE AO MADE THE ADDITION WHICH WAS CONF IRMED IN THE APPEAL BY LD. CIT(A) AND THE ASSESSEE FILED APPEAL BEFORE THI S TRIBUNAL WHICH WAS REGISTERED AS ITA NO. 04/MUM/2010 AND THE SAME WAS RESTORED TO THE FILE OF AO FOR PASSING THE FRESH ORDER AFTER NECESSARY EXAM INATION OF THE SALES BILLS DELIVERY CHALLAN CERTIFICATE NUMBER OF THE SHARES SOLD. THE LD. AR OF THE ASSESSEE ARGUED THAT HE HAS SUPPLIED THE AO THE CON TRACT NOTE (PAGE NO. 14 TO 16) DEBIT NOTE (PAGE NO. 17 TO 17A AND 18) COPY OF S.T.T. (PAGE NO. 17). COPY OF ORDER OF REGISTRAR OF COMPANIES DATED 11.02.2011 ABOUT STRIKING THE NAME OF GARARI IMPEX PVT. LTD. COPY OF LEDGER A/C OF SH ARE BROKER COPY OF CHEQUE(S) IN RESPECT OF CONSIDERATION OF THE SALE T RANSACTION ALONG WITH THE STATEMENT OF ACCOUNT OF ASSESSEE FOR THE YEAR ENDIN G ON 31.03.1998 31.03.2002 31.03.2003 31.03.2004 & 31.03.2005 SHO WING THE INVESTMENT IN ALOK TEXTILE AND RELIANCE INDUSTRIES. THE AR OF THE ASSESSEE ARGUED THAT THE ASSESSEE IS NOT HAVING DISTINCTIVE NUMBER OF SHARE AND NO SUCH RECORD WAS KEPT BY ASSESSEE. THE ASSESSEE TRANSACTED THE SALE THROU GH BROKER REGISTERED WITH BSE. THE AO SENT THE NOTICE TO BSE AND THE BROKER AND BROKER AS WELL AS THE BSE CONFIRMED THE SALE TRANSACTION OF THE SHARES. T HE LD. DR FOR THE REVENUE SUPPORTED THE ORDER OF AUTHORITIES BELOW. 3 ITA NO. 5129/M/2015- ALMATH TEXTILES PVT. LTD. 4. WE HAVE CONSIDERED THE RIVAL CONTENTION OF THE PART IES AND GONE THROUGH THE ORDERS OF AUTHORITIES BELOW INCLUDING THE ORDER OF THE CO-ORDINATE BENCH OF THIS TRIBUNAL IN ITA NO. 04/MUM/2010 DATED 16.11.20 11. IN THE DIRECTION THE CO-ORDINATE BENCH OBSERVED THAT IT IS POSSIBLE TO S ALE THE SHARES IN THE PHYSICAL FORMS IN MARKET TRADE HOWEVER IN SUCH CASE THE A SSESSEE IS REQUIRED TO ISSUE SALES BILL AND DELIVERY CHALLANS GIVING THE CERTIF ICATE NUMBER AND DISTINCTIVE NUMBER OF SHARE SOLD. HOWEVER THE AO IN THE REMAND PROCEEDING PASSED THE SIMILAR ORDER SUSTAINING THE ADDITION MADE EARLIER. THE LD. CIT(A) WHILE CONSIDERING THE CASE OF THE ASSESSEE OBSERVED THAT ASSESSEE HAS SOLD THE CAPITAL ASSET I.E. EQUITY SHARE IN BSE AND PAID THE S.T.T THIS FACT WAS DULY CROSSED CONFIRMED BY THE BSE AS WELL AS BY THE BROKER NAMEL Y KAMAL KUMAR JALAN. HOWEVER THE LD. CIT(A) CONCLUDED THAT THE ASSESSEE HAS NOT PROVED THE GENUINENESS OF THE TRANSACTION. AS WE HAVE NOTICED THAT THE LD. AR OF THE ASSESSEE HAD ARGUED THAT THE ASSESSEE IS NOT HAVING DISTINCTIVE NUMBER OF SHARES AS COPY OF THOSE SHARE CERTIFICATES WERE NOT KEPT. WE HAVE SEEN THAT ASSESSEE HAS PLACED ON RECORD CONTRACT NOTE SALES BILL PROOF OF S.T.T. PAID CONFIRMATION OF BROKER AND THE VERIFICATION BY BSE COPY OF ALL THOSE RECORD ARE AVAILABLE IN THE FORM OF PB BEFORE US. THE SALE WAS TRANSACTED THROUGH REGISTERED BROKER SHRI KAMAL KUMAR JALAN SECURITIES PVT. LTD. THE CONSIDERATION OF SALE TRANSACTION WAS PAID THROUGH CHEQUE(S) COPIES OF WHICH ARE AVAILABLE ON RECORD. AS PER OUR CONSIDERED OPIN ION THE ASSESSEE HAS DISCHARGED HIS ONUS TO PROVE THE GENUINENITY OF THE TRANSACTION. WITH THESE OBSERVATIONS THE APPEAL OF THE ASSESSEE IS ALLOWED . 5. IN THE RESULT APPEAL OF THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 19 TH OCTOBER 2016. SD/- SD/- (R.C.SHARMA) (PAWAN SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI; DATED 19/10/2016 S.K.PS 4 ITA NO. 5129/M/2015- ALMATH TEXTILES PVT. LTD. COPY OF THE ORDER FORWARDED TO : BY ORDER (ASSTT.REGISTRAR) ITAT MUMBAI 1. THE APPELLANT 2. THE RESPONDENT. 3. THE CIT(A) MUMBAI. 4. CIT 5. DR ITAT MUMBAI 6. GUARD FILE. //TRUE COPY/