Assistant Commissioner of Income Tax, Circle-3, Vardaan, Lower Ground floor, MIDC, Wagle Indl. Estate, Thane Vs. Shri Vasudevan Rangarajan, Sharanagati, 20, Shreesh CHS Ltd, Hajuri Darga Road, Thane-400604.
November, 21st 2015
IN THE INCOME TAX APPELLATE TRIBUNAL" F" BENCH, MUMBAI
BEFORE S/SHRI B.R.BASKARAN, AM AND PAWAN SINGH, JM
( / Assessment Year:2007-2008)
Assistant Commissioner of / Shri Vasudevan Rangarajan,
Income Tax, Circle-3, Vs.
Vardaan, 20, Shreesh CHS Ltd,
Hajuri Darga Road,
Lower Ground floor, Thane-400604.
MIDC, Wagle Indl. Estate,
( /Appellant) .. ( / Respondent)
./ ./PAN. :AAABPV2385A
/ Revenue by Shri A K Dhondial
/Assessee by None
/ Date of Hearing :17.11.2015
/Date of Pronouncement:17.11.2015
/ O R D E R
Per B R Baskaran, AM:
The appeal filed by the revenue is directed against the order dated
24.1.2012 passed by the Ld CIT(A)-1, Thane and it relates to the
assessment year 2007-08.
2. The penalty of Rs.8,64,300/- levied by the AO under section
271(1)(c) of the Income Tax act, 1961, having been deleted by the ld.
CIT(A), the Revenue has filed this appeal before us.
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3. None appeared on behalf of the assessee even though the notices
were issued by RPAD on several occasions. Hence, we proceed to dispose
of the appeal ex-parte, without the presence of the assessee.
4. We heard the ld. DR and perused the record. The assessee has
derived salary income from M/s ACC Ltd. During the year under
consideration, the assessee suffered a loss of Rs.25,24,716/- from share
trading activities. In the return of income, the assessee set off of share
trading loss against the salary income and accordingly computed the total
income. It is pertinent to note that the Income tax provisions do not
permit set off of share trading loss against salary income. However, in the
assessment proceedings, the assessee accepted the mistake in claiming
set off of loss from share trading activity against salary income.
Accordingly, the AO completed the assessment disallowing the set off
claimed by the assessee. The AO levied penalty of Rs.8,64,300/- by
holding that the assessee has furnished inaccurate particulars of income by
claiming set off of loss suffered in share trading activities against the
salary income. The ld. CIT(A), however, deleted the addition by following
the decision of Hon'ble Supreme Court rendered in the case of CIT
vs. Reliance Petro products (2010) 322 ITR 158 (SC).
5. The ld. DR submitted that the decision rendered by the Hon'ble
Supreme Court in the case of Reliance Petroproduct (supra) is not
applicable to the facts of the present case. He submitted that the decision
rendered by the Hon'ble Supreme Court in the case of Reliance
Petroproudct (supra) shall be applicable in respect of deductions which are
not sustainable in law. He submitted that the assessee, in the instant
case, has claimed set off share trading loss against the salary income
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which is not permissible under the provisions of Income Tax Act. Further,
he has availed services of Chartered Accountant for filing return of income
and hence the assessee has deliberately furnished inaccurate particulars of
6. We find merit in the contentions of the ld.DR that the decision
rendered in the case of Reliance petro products Ltd (supra) may not be
applicable to the facts of the present case. We have noticed that the Ld
CIT(A) has granted relief by following the said decision. Accordingly, we
are of the view that the decision has been rendered by the ld.CIT(A) under
incorrect appreciation of law. Accordingly, we are of the view that this
issue requires fresh examination at the end of the ld.CIT(A). Accordingly,
we set aside the order of ld.CIT(A) and restore the matter to his file with a
direction to adjudicate the same afresh after providing necessary
opportunity of being heard to the assessee.
7. In the result, the appeal of the revenue is allowed for statistical
Pronounced accordingly on 17th November, 2015.
17th Nov, 2015
(PAWAN SINGH) ( B.R. BASKARAN)
JUDICIAL MEMBER ACCOUNTANT MEMBER
Mumbai:17th Nov, 2015.
.../ SRL , Sr. PS
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/Copy of the Order forwarded to :
1. / The Appellant
2. / The Respondent.
3. () / The CIT(A)- concerned
4. / CIT concerned
5. , , /
DR, ITAT, Mumbai concerned
6. / Guard file.
/ BY ORDER,
, /ITAT, Mumbai