D.C.I.T.CIRCLE 16(2), MUMBAI v. SHRI. BHARAT R. RUIA (HUF), MUMBAI

ITA 6475/MUM/2008 | 2004-2005
Pronouncement Date: 29-03-2010 | Result: Allowed

Appeal Details

RSA Number 647519914 RSA 2008
Bench Mumbai
Appeal Number ITA 6475/MUM/2008
Duration Of Justice 1 year(s) 4 month(s) 22 day(s)
Appellant D.C.I.T.CIRCLE 16(2), MUMBAI
Respondent SHRI. BHARAT R. RUIA (HUF), MUMBAI
Appeal Type Income Tax Appeal
Pronouncement Date 29-03-2010
Appeal Filed By Department
Order Result Allowed
Bench Allotted B
Tribunal Order Date 29-03-2010
Date Of Final Hearing 26-03-2010
Next Hearing Date 26-03-2010
Assessment Year 2004-2005
Appeal Filed On 07-11-2008
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES B MUMBAI BEFORE SHRI R.K.GUPTA JM AND SHRI R.S.SYAL AM ITA NO.6475/MUM/2008 : ASST.YEAR 2004-2005 THE DY.COMMISSIONER OF INCOME-TAX CIRCLE 16(2) MUMBAI. VS. SHRI BHARAT R.RUIA (HUF) PROP. OF B.R.INTERNATIONAL RUIA HOUE 19 BHAUSAHEB HIRE MARG MALABAR HILL MUMBAI 400 006 PA NO.AACHB3596E. (APPELLANT) (RESPONDENT) APPELLANT BY : S/SHRI VIRENDRA OJHA & S.S.RANA RESPONDENT BY : MS.NAMRATA SHAH O R D E R PER R.S.SYAL AM : THIS APPEAL BY THE REVENUE ARISES OUT OF THE ORDER PASSED BY THE COMMISSIONER OF INCOME-TAX (APPEALS) ON 28.8.2008 I N RELATION TO THE ASSESSMENT YEAR 2004-2005. 2. THE ONLY GRIEVANCE RAISED BY THE REVENUE IN ITS APPEAL IS AGAINST THE ACTION OF THE LEARNED CIT(A) DELETING THE ADDITION OF RS.4 94 09 849 MADE BY THE A.O. HOLDING LOSS IN DERIVATIVE TRADING AS NON-SPECULAT ION LOSS. BRIEFLY STATED THE FACTS OF THE CASE ARE THAT THE ASSESSEE WAS ENGAGED IN TH E BUSINESS OF PURCHASE AND SALE OF SHARES AND SECURITIES WAREHOUSING AND DEALING IN PROPERTIES . RETURN DECLARING LOSS OF RS.6.96 CRORE WAS FILED. THE ASSESSING OFFI CER DISALLOWED LOSS FROM DERIVATIVE TRADING AMOUNTING TO RS.4.94 CRORE AND OTHER SPECULATIVE LOSSES OF RS.1.72 CRORE. THE LEARNED CIT(A) OVERTURNED THE VI EW TAKEN BY THE ASSESSING OFFICER QUA LOSS FROM DERIVATIVE TRADING AMOUNTING TO RS.4.94 CRORE AGAINST WHICH THE REVENUE HAS COME UP IN APPEAL BEFORE US. ITA NO.6475/MUM/2008 SHRI BHARAT R.RUIA (HUF). 2 3. WE HAVE HEARD THE LEARNED DEPARTMENTAL REPRESENT ATIVE AND PERUSED THE RELEVANT MATERIAL ON RECORD. WE FIND THAT THE ISSUE RAISED IN THIS APPEAL HAS BEEN DECIDED BY THE SPECIAL BENCH OF THE TRIBUNAL IN SHREE CAPITAL SERVICES LIMITED VS. ACIT [(2009) 124 TTJ 740 (KOL.) (SB)] HOLDING THE INCOME FROM DERIVATIVES AS SPECULATIVE UP TO ASSESSMENT YEAR 2005-2006. FURTH ER THE INSERTION OF CLAUSE (D) OF PROVISO TO SECTION 43(5) HAS BEEN HELD TO BE PROSPE CTIVE AND HENCE APPLICABLE FROM ASSESSMENT YEAR 2006-2007 ONWARDS. SINCE THE ASSESS MENT YEAR UNDER CONSIDERATION IS 2004-2005 THE DECISION OF THE SPE CIAL BENCH IN SHREE CAPITAL SERVICES LIMITED (SUPRA) WILL SQUARELY APPLY TO THE FACTS OF THE INSTANT CA SE. RESPECTFULLY FOLLOWING THE PRECEDENT WE OVERTURN TH E IMPUGNED ORDER ON THIS ISSUE AND RESTORE THE ACTION OF THE A.O. 4. IN THE RESULT THE APPEAL IS ALLOWED. ORDER PRONOUNCED ON THIS 29 TH DAY OF MARCH 2010. SD/- SD/- ( R.K.GUPTA ) ( R.S.SYAL ) JUDICIAL MEMBER ACCOUNTANT M EMBER MUMBAI : 29 TH MARCH 2010. DEVDAS* COPY TO : 1. THE APPELLANT. 2. THE RESPONDENTS. 3. THE CIT CONCERNED 4. THE CIT(A) - XVI MUMBAI. 5. THE DR/ITAT MUMBAI. 6. GUARD FILE. TRUE COPY. BY ORDER ASSISTANT REGISTRAR ITAT MUMBAI. ITA NO.6475/MUM/2008 SHRI BHARAT R.RUIA (HUF). 3 DATE INITIAL 1. DRAFT DICTATED ON 26.03.2010 SR.PS 2. DRAFT PLACED BEFORE AUTHOR 26.03.2010 SR.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 7. FILE SENT TO THE BENCH CLERK SR.PS 8. DATE ON WHICH FILE GOES TO THE HEAD CLERK. 9. DATE OF DISPATCH OF ORDER. *