SURYAMUKHI TRADING & FINANCE P. LTD, MUMBAI v. DCIT CIR 2(3), MUMBAI

ITA 6310/MUM/2010 | 2001-2002
Pronouncement Date: 21-12-2011 | Result: Partly Allowed

Appeal Details

RSA Number 631019914 RSA 2010
Assessee PAN AAACS5305B
Bench Mumbai
Appeal Number ITA 6310/MUM/2010
Duration Of Justice 1 year(s) 3 month(s) 29 day(s)
Appellant SURYAMUKHI TRADING & FINANCE P. LTD, MUMBAI
Respondent DCIT CIR 2(3), MUMBAI
Appeal Type Income Tax Appeal
Pronouncement Date 21-12-2011
Appeal Filed By Assessee
Order Result Partly Allowed
Bench Allotted E
Tribunal Order Date 21-12-2011
Date Of Final Hearing 14-12-2011
Next Hearing Date 14-12-2011
Assessment Year 2001-2002
Appeal Filed On 23-08-2010
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH E MUMBAI BEFORE SHRI N.V.VASUDEVAN(J.M) & SHRI R.K.PANDA (A .M) ITA NO.6310/MUM/2010(A.Y.2001-02) M/S. SURYAMUKHI TRADING & FINANCE PVT. LTD. KALINA MOTOR COMPOUND NEAR AIR INDIA COLONY KALINA MUMBAI 400 029. PAN:AAACS 5305B (APPELLANT) VS. THE DCIT CIR. 2(3) ROOM NO.555 5 TH FLOOR AAYKAR BHAVAN MK ROAD MUMBAI 400 020. (RESPONDENT) APPELLANT BY : NONE REVENUE BY : SHRI O.A. MAO (DR) DATE OF HEARING : 14/12/2011 DATE OF PRONOUNCEMENT : 21/12/2011 ORDER PER N.V.VASUDEVAN J.M THIS IS AN APPEAL BY THE ASSESSEE AGAINST THE ORD ER DATED 21/7/2010 OF CIT(A) 6 MUMBAI RELATING TO A.Y 2001-02. THE GR OUNDS RAISED BY THE ASSESSEE READ AS FOLLOWS: 1. THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS ) HAS ERRED IN LAW AND FACTS IN DISMISSING THE APPEAL FILED BY THE ASSESSEE. 2. THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN LAW AND FACTS IN NOT ADMITTING THE APPEAL BY CONDONING THE DELAY IN FILING THE APPEAL. HE OUGHT TO HAVE CONDONED THE DELAY AND ADMITTED THE APPEAL. 3. THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN LAW AND FACTS IN NOT DELETING THE PENALTY OF RS. 5 31 0 00/- IMPOSED BY THE A.O. HE OUGHT TO HAVE DELETED THE PENALTY. 4. THE APPELLANT CRAVES LEAVE TO ADD AMEND MODIFY ALTER AND BR DELETE ANY OF THE ABOVE GROUNDS OF APPEAL. ITA NO.6310/MUM/2010(A.Y.2001-02) 2 2. THE ASSESSEE IS A COMPANY. IT IS ENGAGED IN THE BUSINESS OF INVESTMENT TRADING IN SHARES AND FINANCIAL ACTIVIT IES. IN THE COURSE OF ASSESSMENT PROCEEDINGS THE ASSESSEE HAD CLAIMED SET OFF OF OTHER INCOME AGAINST LOSS IN THE BUSINESS OF TRADING IN SHARES. THE AO REJECTED THE CLAIM ON THE GROUND THAT LOSS IN SHARE TRADING BUSINESS I S A DEEMED SPECULATION LOSS IN VIEW OF EXPLANATION TO SECTION 73 OF THE AC T AND THEREFORE SPECULATION LOSS CANNOT BE SET OFF AGAINST OTHER INCOME. IN R ESPECT OF THE AFORESAID DISALLOWANCE MADE IN THE COURSE OF ASSESSMENT PROCE EDINGS PENALTY PROCEEDINGS WERE INITIATED BY THE AO FOR FURNISHING INACCURATE PARTICULARS OF INCOME AND VIDE AN ORDER DATED 10/3/2006 PENALTY O F RS. 5 30 572/- WAS IMPOSED ON THE ASSESSEE. AGAINST THE AFORESAID ORD ER THE ASSESSEE FILED AN APPEAL BEFORE THE CIT(A). 3. THE APPEAL BEFORE CIT(A) OUGHT TO HAVE BEEN FIL ED WITHIN 30 DAYS FROM THE DATE OF SERVICE OF THE ORDER IMPOSING PENALTY. THE ORDER IMPOSING PENALTY WAS SERVED ON THE ASSESSEE ON 18/3/2006. THE ASSES SEE OUGHT TO HAVE FILED THE APPEAL ON OR BEFORE 17/4/2006. THE ASSESSEE HO WEVER FILED THE APPEAL ONLY ON 11/12/2006. THEREFORE THERE WAS A DELAY O F 237 DAYS IN FILING THE APPEAL BEFORE THE CIT(A). 4. AN APPLICATION FOR CONDONATION OF DELAY IN FILIN G THE APPEAL WAS FILED. AN AFFIDAVIT IN SUPPORT OF SUCH APPLICATION WAS FIL ED BY ONE SHRI SUBHASH RUGNATH DOSHI ERSTWHILE DIRECTOR OF THE ASSESSEE C OMPANY. IT HAS BEEN AFFIRMED IN THE SAID AFFIDAVIT THAT BETWEEN 1/4/200 6 AND 24/4/2006 HE WAS IN THE HOSPITAL. AFTER DISCHARGE FROM THE HOSPITAL HE WAS ADVISED TO AVOID STRESS. IT WAS ALSO SUBMITTED THAT ON 28/6/2006 TH E MANAGEMENT OF THE ASSESSEE CHANGED. THE NEW MANAGEMENT ON VERIFICATI ON OF THE RECORDS NOTICED THAT NO APPEAL HAD BEEN FILED AND THEREFOR E THE NEW DIRECTOR FILED THE APPEAL ON 11/12/2006. THE DELAY THEREFORE WA S EXPLAINED AS DUE TO THE AFORESAID REASONS AND NOT DUE TO ANY WILLFUL NE GLECT ON THE PART OF THE ITA NO.6310/MUM/2010(A.Y.2001-02) 3 ASSESSEE. THE CIT(A) HOWEVER REJECTED THE PLEA OF THE ASSESSE. HE HELD THAT THE DELAY IN FILING THE APPEAL COULD BE JUSTIFIED F OR A PERIOD OF 24 DAYS WHEN THE ERSTWHILE DIRECTOR OF THE APPELLANT WAS ADMITTE D TO THE HOSPITAL BUT THERE WAS APPARENTLY NO JUSTIFICATION FOR FURTHER DELAY O N THE GROUND THAT THE ERSTWHILE DIRECTOR WAS NOT PERMITTED BY THE DOCTORS TO TAKE ANY STRESS AFTER DISCHARGE FROM HOSPITAL. ACCORDING TO THE CIT(A) TH E DIRECTOR DID NOT HAVE TO UNDERTAKE ANY STRESS FOR FILING OF APPEAL WHICH I S A ROUTINE NO-STRESS WORK DONE BY THE PROFESSIONALS. THE CIT(A) ALSO HELD THA T THERE WAS NO PROPER EXPLANATION FOR THE DELAY AFTER THE NEW MANAGEMENT TOOK OVER THE APPELLANT COMPANY W.E.F. 28/06/2006. 5. AGGRIEVED BY THE ORDER OF THE CIT(A) THE ASSESS EE HAS FILED THE PRESENT APPEAL BEFORE THE TRIBUNAL. THE NOTICE OF HEARING WAS SERVED ON THE ASSESSEE BUT NONE APPEARED ON BEHALF OF THE ASSESSEE. WE HA VE HEARD THE LD. D.R AND ARE OF THE VIEW THAT THE DELAY IN FILING THE APPEAL OUGHT TO HAVE BEEN CONDONED BY THE CIT(A). THE FACT THAT THE ERSTWHIL E DIRECTOR WAS HOSPITALIZED FROM 1/4/06 TO 24/4/06 IS NOT DISPUTED. THE FACT T HAT THERE WAS A CHANGE IN MANAGEMENT IS ALSO NOT DISPUTED. THE NEW MANAGE MENT COULD NOTICE THE FACT THAT NO APPEAL WAS FILED AGAINST THE ORDER OF THE CIT(A) ONLY AFTER THEIR TAKE OVER. THIS IS BOUND TO INVOLVE SOME TIME. WE ARE OF THE VIEW THAT THE EXPLANATION OFFERED BY THE ASSESSEE IS ACCEPTABLE. THERE HAS BEEN NO NEGLIGENCE ON THE PART OF THE ASSESSEE. WE ARE OF THE VIEW THAT IN THE CIRCUMSTANCES THE DELAY IN FILING THE APPEAL SHOULD BE CONDONED. WE ACCORDINGLY CONDONE THE DELAY IN FILING THE APPEAL BY THE ASSESSEE BEFORE THE CIT(A). THE CIT(A) HAS NOT DECIDED THE APPEAL ON MERIT. WE THEREFORE DIRECT THE CIT(A) TO DECIDE THE APPEAL OF THE ASSES SEE ON MERITS. FOR STATISTICAL PURPOSES THE APPEAL OF THE ASSESSEE IS TREATED AS ALLOWED. ITA NO.6310/MUM/2010(A.Y.2001-02) 4 6. IN THE RESULT THE APPEAL OF THE ASSESSEE IS TRE ATED AS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON TH E 21 ST DAY OF DEC. 2011. SD/- SD/- ( R.K.PANDA ) (N.V.VASUDEVAN) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI DATED. 21ST DEC.2011 COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3 . THE CIT CITY CONCERNED 4. THE CIT(A)- CONCERNED 5. THE D.RE BENCH. (TRUE COPY) BY ORDER ASST. REGISTRAR I TAT MUMBAI BENCHES MUMBAI. VM. ITA NO.6310/MUM/2010(A.Y.2001-02) 5 DETAILS DATE INITIALS DESIGNATION 1 DRAFT DICTATED ON 14/12/11 SR.PS/PS 2 DRAFT PLACED BEFORE AUTHOR 15/12/11 SR.PS/PS 3 DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER JM/AM 4 DRAFT DISCUSSED/APPROVED BY SECOND MEMBER JM/AM 5. APPROVED DRAFT COMES TO THE SR.PS/PS SR.PS/PS 6. KEPT FOR PRONOUNCEMENT ON SR.PS/PS 7. FILE SENT TO THE BENCH CLERK SR.PS/PS 8 DATE ON WHICH THE FILE GOES TO THE HEAD CLERK 9 DATE OF DISPATCH OF ORDER