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Income Tax Appellate Tribunal, “E” BENCH, MUMBAI
Before: SHRI N.K. BILLAIYA & SHRI SANJAY GARG
आदेश / O R D E R
PER N.K. BILLAIYA, AM: These are appeals by the assessee preferred against three separate orders of the Ld. CIT(A)-23, Mumbai pertaining to Assessment years 2006-07 & 2008-09. Representatives of both sides agreed that common issues are involved in the captioned appeals, therefore they were heard together and disposed of by this consolidated order for the sake of convenience.
The only grievance of the assessee relates to the treatment of Rs. 45,38,043/- as income from business instead of capital gains declared by the assessee.
At the very outset, the Ld. Counsel for the assessee brought to our notice the decision of the Tribunal in assessee’s own case for assessment years 2005-06 and 2007-08 in ITA JNos. 2412/M/2009 and 4534/M/2011. It is the say of the Ld. Counsel that on identical set of facts, the Tribunal has decided the issue in favour of the assessee and against the Revenue. The Ld. Counsel supplied the copy of the order of the Tribunal.
Per contra, the Ld. Departmental Representative could not bring any distinguishing decision in favour of the Revenue.
We have given a thoughtful consideration to the orders of the authorities below qua the decision of the Tribunal in assessee’s own case (supra). We find force in the contention of the Ld. Counsel. While dismissing the appeal of the assessee, the Ld. CIT(A) has followed the order of his predecessor for A.Y. 2005-06. The order of the Ld. CIT(A) for A.Y. 2005-06 has been set aside by the Tribunal in IT No. 2412/M/2009 wherein the Tribunal at para-7 concluded by holding that “ Thus on the facts and circumstances of the assessee’s case, we hold that the gain from transaction of shares by the assessee is to be assessed under the head ‘ capital gains’ and not as ‘ business income’. Accordingly, the order of the CIT(A) is set aside and the ground raised by the assessee is treated as allowed”.
3 ITA No. 1412 & 1413/M/12 Respectfully following the decision of the Co-ordinate Bench, we set aside the order of the Ld. CIT(A) and direct the AO to treat income under the head ‘ Capital gains’. Ground raised by the assessee in ITA No. 8952/M/2010 is allowed.
ITA No. 1412/M/2012- A.Y. 2006-07 is against the levy of penalty u/s. 271B of the Act. The penalty has been levied because the AO has treated the gains from share as business income of the assessee and since the turnover exceeded Rs. 40,00,000/- and since the assessee has not got his account audited as per provisions of Sec. 44AB of the Act, the AO levied penalty of Rs. 1,00,000/- u/s. 271B of the Act. The Ld. CIT(A) confirmed the penalty.
Aggrieved by which the assessee is before us.
In (supra) we have decided the issue against the Revenue and in favour of the assessee and directed the AO to treat the income under the head ‘Capital gains’ thus holding that the assessee is not a trader in shares since the very foundation of levy of penalty u/s. 271B of the Act has been removed by us. We do not find any reason for such levy. We direct the AO to delete the penalty so levied. Ground raised by the assessee in ITA No. 1412/M/2012 is allowed.
ITA No. 1413/M/2012 – A.Y. 2008-09
Ground No. 1 is of general in nature and needs no separate adjudication.
10.1. The AO disallowed the salary paid to the Driver and added the same to the income from business which was confirmed by the Ld. CIT(A).
10.2. Before us, the Ld. Counsel for the assessee drew our attention to the assessment order qua the computation of income and pointed out that the driver’s salary was claimed under the head ‘ Income from other sources’ and the assessee has not shown any income under the head ‘ business income’. The Ld. Counsel further pointed out that the computation of income from other sources has been accepted by the AO but salary paid to the driver has been added to the business income for no reason.
We have gone through the assessment order. We have also carefully perused the computation of income. We find that under the head Income from other sources, the assessee has shown net income at Rs. 17,28,139/-. In the assessment order at page-1, the AO has also computed the income from other sources at Rs. 17,28,139/-. However, the AO has added back driver’s salary under the head ‘income from business’. We do not find any logic nor any justification for such disallowances. Since all other expenses claimed under the head income from other sources have been allowed by the AO, we do not find any reason for the disallowance of Rs. 77,255/-. We accordingly direct the AO to delete the addition.
In the result, all the appeals filed by the assessee are allowed.
Order pronounced in the open court on 16th October, 2015