Shanti Lal Vira, Kolkata v. DCIT, Circle - 45, Kolkata, Kolkata

ITA 9/KOL/2010 | 2006-2007
Pronouncement Date: 11-03-2011

Appeal Details

RSA Number 923514 RSA 2010
Assessee PAN ABTPV6063A
Bench Kolkata
Appeal Number ITA 9/KOL/2010
Duration Of Justice 1 year(s) 2 month(s) 9 day(s)
Appellant Shanti Lal Vira, Kolkata
Respondent DCIT, Circle - 45, Kolkata, Kolkata
Appeal Type Income Tax Appeal
Pronouncement Date 11-03-2011
Appeal Filed By Assessee
Bench Allotted A
Tribunal Order Date 11-03-2011
Date Of Final Hearing 21-04-2010
Next Hearing Date 21-04-2010
Assessment Year 2006-2007
Appeal Filed On 01-01-2010
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH : KOLKATA () . . ! . .. .'# '#'# '#. .. . $% ) [BEFORE HONBLE SRI B.R.MITTAL JM & HONBLE SRI C. D. RAO AM] !& / I.T.A NO. 09/KOL/2010 '( )*/ ASSESSMENT YEAR : 2006-07 SHANTI LAL VIRA -VS.- DY. COMMISSIONE R OF INCOME TAX KOLKATA [PAN : ABTPV6063A] CIRCLE-45 KOLKATA [ - /APPELLANT ] [ /0 -/ RESPONDENT ] - / FOR THE APPELLANT : SUBASH AGARWAL /0 - / FOR THE RESPONDENT : SHRI PIYUSH KOLHE $1 /ORDER . .. .'# '#'# '#. .. . $% PER C. D. RAO A. M. THE ASSESSEE HAS FILED THIS APPEAL FOR ASSESSMENT YEAR 2006-07 AGAINST THE ORDER OF THE LD. CIT(A)-XXX KOLKATA DATED 27.10.2009. THE ASSES SEE HAS TAKEN FOLLOWING GROUNDS OF APPEAL :- (1) ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE LD. CIT(A)-XXX HAS ERRED IN CONFIRMING THE TAXATION OF SHORT TERM CAPI TAL GAIN OF RS.31 61 584/- ARISING OUT OF SALE OF 21 000 SHARES OF SHREENIDHI AS NORMAL STGG INSTEAD OF CHARGING THE SAME U/S. 111A OF THE ACT. (2) ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE LD. CIT(A)-XXX HAS ERRED IN CONFIRMING THE TAXATION OF SHORT TERM CAPI TAL GAIN OF RS.1 19 840/- ARISING OUT OF SALE OF 800 SHARES OF SHREENIDHI AS SPECULATION INCOME INSTEAD OF CHARGING THE SAME U/S . 111A OF THE ACT. 2. BRIEF FACTS OF THE ISSUE ARE THAT WHILE DOING SC RUTINY ASSESSMENT ASSESSING OFFICER NOTED THE DISCREPANCY IN SHARE TRANSACTION. THE ASSESSEE CLAIMED PURCHASE OF SHARES AS UNDER : 1. 21.04.2005 22 800 SHARES RS.2 71 776/- 2. 05.05.2005 800 SHARES RS. 10 256/- AS PER CONTRACT NOTES ISSUED BY THE BROKER R.P. SH AH THE PURCHASES WERE FOUND AS UNDER :- ITA NO. 09/KOL/20 10 2 21.04.2005 10 000 RS.1 19 200/- 21.04.2005 10 000 RS.1 19 200/- 21.04.2005 2 000 RS. 33 376/- 05.05.2005 800 RS. 10 256/- 22 800 RS.2 282 032 ON PERUSAL OF THESE DETAILS THE A.O NOTICED THE D ISCREPANCY IN THE NUMBER OF SHARES PURCHASED AND CLAIMED AS SOLD BY T HE APPELLANT. THE A.O NOTICED THAT THE DEMAT ACCOUNT OF THE APPELLANT SHO WS CREDIT OF 22 800 SHARES AND DEBIT OF 21 800 SHARES. THE A.O EXAMINED DETAILS OF SALE OF THE SRINIDHI SHARES. THE A.O NOTICED THAT SALE TRANSACTION CLAIMED BY TH E APPELLANT ARE NOT CONFIRMED BY THE CALCUTTA STOCK EXCHANGE. THE TRADE CLAIMED T O BE EXECUTED BY THE BROKER ARE NOT REFLECTED IN THE STOCK EXCHANGE. OUT OF THE SHARES CLAIMED AS SOLD BY THE APPELLANT 1800 SHARES WERE ONLY DISCLOSED IN THE ST OCK EXCHANGE. THE BALANCE OF 21 000 SHARES OF SRINIDHI ARE NOT CONFIRMED BY THE STOCK EXCHANGE. THE TRANSACTION CLAIMED BY THE APPELLANT AS SALES DID N OT FIND REFLECTION IN THE STOCK EXCHANGE DETAILS ARE DISCUSSED BY THE A.O AT PAGE- 6 OF THE ASSESSMENT ORDER. AFTER CONSIDERING THE DISCREPANCY NOTICED THE A.O CONCLUDED AS UNDER : 1. THE PROFIT ON SALE OF 800 SHARES IS TREATED AS SPECULATION PROFIT SINCE THE SHARES WERE NOT CREDITED IN THE DEMAT ACCOUNT OF TH E APPELLANT. 2. THE PROFIT ON THE SALE OF 1800/ SHARES ARE CONS IDERED AS SHORT TERM CAPITAL GAIN FOR WHICH TRANSACTION APPEARED IN THE STOCK EXCHANGE. THE STT IS ALSO PAID FOR THE TRANSACTION IN THESE SHARES. THE A.O ASSESSED THE SHORT TERM CAIITAL1 GAIN U/S.111A AT A SPECIAL RATE. 3. THE SALE OF 21 000 SHARES OF SRINIDHI IS NOT REF LECTED IN THE CALCUTTA EXCHANGE. IN THE ABSENCE OF EVIDENCE REGARDING THE SALES OF THESE SHARES THROUGH STOCK EXCHANGE THE A.O. ASSESSED THE PROFIT DISCLO SED BY THE APPELLANT AS SHORT TERM CAPITAL GAIN AT NORMAL RATE. SINCE TRANSACTION IS NOT ROUTED THROUGH THE STOCK EXCHANGE THE APPELLANTS CLAIM REGARDING TAXATION U /S. 111A IS REJECTED BY THE A.O. ON APPEAL LD. CIT(A) HAS CONFIRMED THE ACTION OF T HE ASSESSING OFFICER BY OBSERVING THAT THE SALES OF THESE SHARES ARE NOT BEING AFFECTED BY THE CALCUTTA STOCK EXCHANGE AND FOR THE PURPOSE OF TAXATION U/S. 111A SALE TRANSACTIONS ARE REQUIRE D TO BE ENTERED THROUGH STOCK EXCHANGE AND STT IS REQUIRED TO BE PAID. SINCE THE ASSESSEE FAIL ED TO FURNISH EVIDENCE THAT 21 000 SHARES ARE SOLD THROUGH THE STOCK EXCHANGE AND STT IS PAID TH E APPELLANT IS NOT ENTITLED FOR TAXATION U/S. 111A. AS REGARDING SALES OF 800 SHARES OF SREENIDHI LD. CIT(A) HAS CONFIRMED THE ACTION OF THE ASSESSING OFFICER BY OBSERVING THAT SINCE THE S HARES WERE NOT CREDITED OR DEBITED IN THE DEMAT ACCOUNT OF THE ASSESSEE. 3. AGGRIEVED BY THIS NOW THE ASSESSEE IS IN APPEAL BEFORE US. ITA NO. 09/KOL/20 10 3 4. AT THE TIME OF HEARING BEFORE US LD. COUNSEL AP PEARING ON BEHALF OF THE ASSESSEE BY REFERRING TO PAPER BOOK AT PAGES 8 & 9 WHICH CONTAI NS COPY OF LETTER FROM BROKER AND 10 TO 12 COPY OF CONTRACT NOTES IN RESPECT OF SALES OF SHARE S DISCLOSING SECURITY TRANSACTION TAX PAID AND CONTENDED THAT THE REVENUE IS NOT JUSTIFIED IN THE FACTS AND CIRCUMSTANCES OF THE CASE. HE FURTHER RELIED ON THE DECISION OF THIS TRIBUNAL IN ITA NO.1330/KOL/2007 DATED 10.08.2007 IN THE CASE OF ITO VS. RAJ KUMAR AGAWAL THE COPY OF T HE SAME WAS FILED. 5. ON THE OTHER HAND LD. DEPARTMENTAL REPRESENTATI VE RELIED ON THE ORDERS OF THE REVENUE AUTHORITIES. 6. AFTER HEARING THE RIVAL SUBMISSIONS AND ON CAREF UL PERUSAL OF THE MATERIAL AVAILABLE ON RECORD WE ARE OF THE VIEW THAT FOR CALCULATION OF TAX OF SHORT TERM CAPITAL GAINS IN CERTAIN CASES U/S. 111A THE ASSESSEE HAS TO ESTABLISH THAT HE HA S PAID SECURITIES TRANSACTION TAX. IT IS FURTHER OBSERVED AS POINTED OUT BY THE LD. CIT(A) THAT IN ORDER TO AVAIL COMPUTATION OF SHORT TERM CAPITAL GAINS U/S. 111A THE TRANSACTIONS ARE TO BE ROUTED THROUGH STOCK EXCHANGE OR IT SHOULD BE ENTERED INTO DEMAT IS NOT A MANDATORY REQUIREMENT. IN THIS CASE CONTRACT NOTE IS SHOWING THAT THE BROKER HAS COLLECTED SECURITIES TRANSACTIO N TAX BUT HOWEVER THIS SECURITIES TRANSACTION TAX HAS BEEN PAID BY THE BROKER TO THE APPROPRIATE AUTHORITY IS NOT EVIDENT FROM RECORD. THEREFORE IN THE INTEREST OF JUSTICE WE SE T ASIDE THE ISSUE TO THE FILE OF THE ASSESSING OFFICER TO REDECIDE THE SAME AS PER LAW AFTER GIVIN G REASONABLE OPPORTUNITY OF HEARING TO THE ASSESSEE. WE FURTHER DIRECT THE ASSESSEE TO SUBSTAN TIATE THAT SECURITIES TRANSACTION TAX HAS BEEN PAID TO APPROPRIATE AUTHORITY IN ORDER TO AVOID BEN EFIT OF SECTION 111A OF THE ACT. 7. IN THE RESULT APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. $1 2 3' 4 56 #% ORDER PRONOUNCED IN THE COURT ON 11. 03. 2011. SD/- SD/- [ . . ] [ . .. .'# '#'# '#. .. . $% ] [B.R.MITTAL ] [ C . D. RAO ] JUDICIAL MEMBER ACCOUNTANT MEMBER (#%) DATED : 11. 03. 2011. [KKC 78 '9: ; /SR.PS] ITA NO. 09/KOL/20 10 4 $1 < /= >$=)/ COPY OF THE ORDER FORWARDED TO: 1. - /APPELLANT- SHRI SHANTI LAL VIRA 173 M.G. ROAD KOLKATA-700007. 2 /0 - / RESPONDENT : DY. COMMISSIONER OF INCOME-TAX CIRCL E-45 3 GOVT. PLACE (WEST) KOLKATA. 3. 1'/ THE CIT 4. 1' ()/ THE CIT(A) KOLKATA. 5. D4 /'/ DR KOLKATA BENCHES KOLKATA [0= // TRUE COPY ] $1'3/ BY ORDER !: /ASSTT REGISTRAR