AVISHA CREDIT CAPITAL LTD,NEW DELHI vs. ITO WARD - 3(4), NEW DELHI
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Income Tax Appellate Tribunal, DELHI BENCH: ‘SMC’ NEW DELHI
Before: SHRI SAKTIJIT DEY
IN THE INCOME TAX APPELLATE TRIBUNAL, DELHI BENCH: ‘SMC’ NEW DELHI
BEFORE SHRI SAKTIJIT DEY, JUDICIAL MEMBER
ITA No.6142/Del/2019 Assessment Year: 2014-15
M/s. Avisha Credit Capital Vs. ITO, Ltd., Ward-3(4), 606, Kailash Building, New Delhi KG Marg, New Delhi PAN :AAACA5715D (Appellant) (Respondent)
Appellant by None Respondent by Sh. Om Prakash, Sr. DR
Date of hearing 21.07.2022 Date of pronouncement 29.07.2022 ORDER This is an appeal by the assessee against order dated
30.04.2019 of learned Commissioner of Income Tax (Appeals)-1,
New Delhi, for the assessment year 2014-15.
When the appeal was called for hearing, none appeared on
behalf of the assessee. Perusal of record reveals that, though, on
multiple occasions the appeal was fixed for hearing earlier but,
assessee never appeared. Since, sufficient opportunities have been
granted to the assessee to represent its case, which the assessee
2 ITA No. 6142/Del/2019 AY: 2014-15
failed to avail, I deem it appropriate to proceed with the appeal ex-
parte qua the assessee after hearing learned Departmental
Representative and based on the materials available on record.
The dispute in the present appeal is in relation with addition
of an amount of Rs.6,00,000/- made by the Assessing Officer in an
order passed under section 154 of the Income-tax Act, 1961 (in
short ‘the Act’).
Briefly the fact are, the assessee is a resident corporate entity.
For the assessment year under dispute, the assessee filed its return
of income on 31.03.2015 declaring income of Rs.95,580/-.
Assessee’s case was selected for scrutiny and assessment was
completed under section 143(3) of the Act vide order dated
11.11.2016 accepting the income returned by the assessee. Post
completion of assessment, the Assessing Officer issued a show-
cause notice to the assessee seeking to rectify the assessment order
by exercising power conferred under section 154 of the Act. In the
show-cause notice, the Assessing Officer observed that interest on
income tax amounting to Rs.7,172/- was inadvertently allowed,
though, it is not an eligible business expenditure. Further, he
observed, loss on sale of shares of VKJ Infra Developers Ltd.
amounting to Rs.6,00,000/- debited to the profit and loss account
3 ITA No. 6142/Del/2019 AY: 2014-15
was wrongly allowed as the shares were held as investment and
not as stock in trade. In reply to the show-cause notice, though,
the assessee accepted the mistake insofar as deduction of interest
on income tax amounting to Rs.7,172/-, however, insofar as claim
of loss of Rs.6,00,000/-, the assessee submitted that it does not
come within the purview of rectifiable mistake. The Assessing
Officer, however, rejected the explanation of the assessee and
proceeded to pass an order under section 154 of the Act on
31.07.2017 adding back the amounts of Rs.7,172/- and
Rs.6,00,000/- respectively. Though, the assessee contested the
addition of Rs.6,00,000/- before learned Commissioner (Appeals),
however, the addition was sustained.
I have heard learned Departmental Representative and
perused the materials on record. Undisputedly, the loss from sale
of shares was debited to profit and loss account as trading loss.
While completing the assessment under section 143(3) of the Act,
the Assessing Officer obviously has accepted the claim. The
Assessing Officer has initiated proceeding under section 154 of the
Act qua the claim of loss on the ground that the shares were held
as investment and not as stock in trade. It is observed, in reply to
show-cause notice issued under section 154 of the Act, the
4 ITA No. 6142/Del/2019 AY: 2014-15
assessee has clearly and categorically submitted that the shares
were held as stock in trade and the issue was examined in course
of scrutiny assessment. Thus, from the aforesaid facts, it is patent
and obvious that the issue, whether the loss on sale of shares
claimed by the assessee is a trading loss or capital loss is a highly
debatable issue. That being the factual position emerging on
record, in my considered opinion, proceeding under section 154 of
the Act could not have been initiated by the Assessing Officer to
rectify the so called mistake as it is not a mistake in the nature of
mistake apparent on the fact of record. Therefore, I delete the
addition of Rs.6,00,000/-. Ground raised is allowed.
In the result, the appeal is allowed.
Order pronounced in the open court on 29th July, 2022
Sd/- (SAKTIJIT DEY) JUDICIAL MEMBER
Dated: 29th July, 2022. RK/- Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(A) 5. DR Asst. Registrar, ITAT, New Delhi
