DCIT 14(2)., MUMBAI v. USHA SUDHIR TULSIYAN, MUMBAI

ITA 3937/MUM/2009 | 2005-2006
Pronouncement Date: 17-02-2010 | Result: Dismissed

Appeal Details

RSA Number 393719914 RSA 2009
Assessee PAN AACPT6797R
Bench Mumbai
Appeal Number ITA 3937/MUM/2009
Duration Of Justice 7 month(s) 28 day(s)
Appellant DCIT 14(2)., MUMBAI
Respondent USHA SUDHIR TULSIYAN, MUMBAI
Appeal Type Income Tax Appeal
Pronouncement Date 17-02-2010
Appeal Filed By Department
Order Result Dismissed
Bench Allotted F
Tribunal Order Date 17-02-2010
Assessment Year 2005-2006
Appeal Filed On 19-06-2009
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES F MUMBAI BEFORE SHRI D. MANMOHAN HONBLE VICE PRESIDENT AND SHRI J. SUDHAKAR REDDY ACCOUNTANT MEMBER ITA NO.3937/MUM/2009 ASSESSMENT YEAR: 2005-2006 THE ASST. COMM. OF INCOME TAX 14(2) EARNEST HOUSE 3 RD FLOOR NARIMAN POINT MUMBAI 400 021. VS. USHA SUDHIR TULSIYAN. C/O. TULSIYA ENT. 70 4 TH FLR. 383 DHABOLKAR WADE 14 THE FL. R.NO.70 KALBADEVI RD. MUMBAI 400 002. PAN AACPT6797R (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI. VIRENDRA OJHA. RESPONDENT BY : NONE. O R D E R PER D. MANMOHAN V.P. THIS APPEAL IS FILED AT THE INSTANCE OF THE REVENU E. ONLY GROUND URGED BY THE REVENUE READS AS UNDER: ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE CIT(A) ERRED IN DIRECTING THE ASSESSING OFFICER TO ACCEPT THE CLAIM OF THE ASSESSEE WITH REGARD TO THE SHORT-TERM CAPITAL- GAIN WITHOUT APPRECIATING THE FACT THAT THE ASSESSEE HAS DONE PU RCHASE AND SALE OF SHARES IN LARGE SCALE AND AT HIGH FREQUENCY AND PERIOD OF HOLDING IS ALSO NOT VERY LONG. 2. NONE APPEARED ON BEHALF OF THE ASSESSEE. HAVIN G REGARD TO THE FACTS OF THE CASE WE PROCEED TO DISPOSE OF THE APPEAL EX- PARTE QUA THE ASSESSEE. WE HAVE HEARD THE LEARNED D.R. AND CAREFULLY PERUSE D THE RECORD. 3. FACTS IN SHORT ARE THAT THE ASSESSEE IN HER IND IVIDUAL CAPACITY CARRIED ON BUSINESS AS A PROPRIETRIX OF M/S. TULSIYAN AGAR WAL ENTERPRISES DEALING IN FABRICS. BESIDES THE ASSESSEE HAD INCOME FROM I NVESTMENTS. ITA NO.3937/MUM/2009 A.Y.: 2005-2006 2 DIVIDENDS INTEREST AND CAPITAL-GAIN WERE ALSO OFFE RED TO TAX UNDER VARIOUS HEADS. DURING THE COURSE OF ASSESSMENT PROCEEDIN GS THE ASSESSING OFFICER NOTICED THAT THE ASSESSEE EARNED INCOME IN THE FORM OF SHORT-TERM CAPITAL- GAIN OUT OF INVESTMENTS IN BONDS MUTUAL FUNDS AND SHARES. ACCORDING TO THE ASSESSING OFFICER THE INCOME ARISING OUT OF SAL E OF BONDS MUTUAL FUNDS ETC. IS ASSESSABLE TO TAX AS BUSINESS INCOME AND NOT UNDER THE HEAD SHORT- TERM CAPITAL-GAIN. VIDE LETTER DATED 07.11.2007 THE ASSESSEE SUBMITTED A DETAILED REPLY TO THE ASSESSING OFFICER. HOWEVER WITHOUT MEETING THE SUBMISSIONS OF THE ASSESSEE THE ASSESSING OFFICER SIMPLY CONCLUDED THAT BECAUSE OF THE HIGH FREQUENCY OF TRANSACTIONS INCOM E THEREON HAS TO BE ASSESSED AS BUSINESS INCOME. 3. AGGRIEVED ASSESSEE CONTENDED BEFORE THE LEARNED CIT(A) THAT THE CONCLUSION REACHED BY THE ASSESSING OFFICER WAS WIT HOUT ANY BASIS. IT WAS EXPLAINED BEFORE THE LEARNED CIT(A) THAT SURPLUS FU ND WAS SIMPLY PARKED BY WAY OF INVESTMENT IN BONDS MUTUAL FUNDS AND SHARES WHICH WERE DULY DISCLOSED IN THE BALANCE-SHEET OF THE ASSESSEE UNDE R THE HEAD INVESTMENTS AND NOT AS STOCK IN TRADE. MATERIAL FURNISHED BEFORE THE LEARNED CIT(A) INDICATE THAT MOST OF THE SCRIPTS WERE HELD FOR MOR E THAT 250 DAYS AND TRANSACTIONS WERE NOT VOLUMINOUS. BY PLACING REL IANCE UPON A DECISION OF ITAT G BENCH IN THE CASE OF GOPAL PUROHIT THE AS SESSEE CONTENDED THAT DELIVERY BASED TRANSACTIONS SHOULD NOT BE TREATED A S BUSINESS TRANSACTIONS AND INCOME EARNED THEREFROM SHOULD BE TREATED AS LO NG-TERM OR SHORT-TERM CAPITAL-GAIN DEPENDING UPON THE PERIOD OF HOLDING. THE ASSESSEE ALSO RELIED UPON SEVERAL OTHER DECISIONS WHEREIN IDENTIC AL ISSUE WAS DECIDED IN FAVOUR OF ASSESSEE. 4. HAVING REGARD TO THE SUBMISSIONS MADE ON BEHALF OF THE ASSESSEE THE LEARNED CIT(A) DIRECTED THE ASSESSING OFFICER TO AC CEPT THE CLAIM OF THE ASSESSEE WITH REGARD TO THE SHORT-TERM CAPITAL-GAIN . 5. AGGRIEVED REVENUE IS IN APPEAL BEFORE US. NO MATERIAL WHATSOEVER WAS FURNISHED BEFORE US TO CONTRADICT THE FINDINGS OF THE LEARNED CIT(A). ITA NO.3937/MUM/2009 A.Y.: 2005-2006 3 UNDER THESE CIRCUMSTANCES WE DID NOT FIND ANY INFI RMITY IN THE ORDER PASSED BY THE LEARNED CIT(A). THEREFORE WE DISMI SS THE APPEAL FILED BY THE REVENUE AND UPHOLD THE ORDER OF THE LEARNED CIT(A). PRONOUNCED IN THE OPEN COURT ON THIS THE 17 TH FEBRUARY 2010. SD/- (J. SUDHAKAR REDDY) (ACCOUNTANT MEMBER) SD/- (D. MANMOHAN) (VICE PRESIDENT) MUMBAI DATED 17 TH FEBRUARY 2010. JANHAVI COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. COMMISSIONER OF INCOME TAX (APPEALS)-XIV MUMBA I 4. COMMISSIONER OF INCOME TAX CITY-XIV MUMBAI 5. DEPARTMENTAL REPRESENTATIVE BENCH F MUMBAI //TRUE COPY// BY ORDER ASSTT. REGISTRAR ITAT MUMBAI ITA NO.3937/MUM/2009 A.Y.: 2005-2006 4 DATE INITIALS 1. DRAFT DICTATED ON 12-02-2010 PS 2. DRAFT PLACED BEFORE AUTHOR 15-02-2010 PS 3. DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER AM/VP 4. DRAFT DISCUSSED/APPROVED BY SECOND MEMBER AM/V P 5. APPROVED DRAFT COMES TO THE SR. PS PS 6. KEPT FOR PRONOUNCEMENT ON PS 7. FILE SENT TO THE BENCH CLERK PS 8. DATE ON WHICH FILE GOES TO THE HEAD CLERK 9. DATE OF DISPATCH OF ORDER