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 All India Federation of Tax Practitioners vs. ITO (ITAT Mumbai)
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DCIT, Circle - 9(3) Room No. 229, 2nd Floor Aayakar Bhavan, M.K. Road Mumbai 400020 Vs. Ghisulal D. Rathod C/o. Cello Plastic Industires Works 5, Vakil Industrial Estate, Walbhat Road, Goregoan (E), Mumbai 400063
September, 23rd 2014
                         "G" Bench, Mumbai

                Before Shri D. Manmohan, Vice President
            and Shri D. Karunakara Rao, Accountant Member

                         ITA No. 5092/Mum/2011
                         (Assessment Year: 2004-05)

 DCIT, Circle - 9(3)             Ghisulal D. Rathod
 Room No. 229, 2nd Floor         C/o. Cello Plastic Industires Works
 Aayakar Bhavan, M.K. Road       5, Vakil Industrial Estate, Walbhat
 Mumbai 400020                   Road, Goregoan (E), Mumbai 400063
                         PAN - AAAPR5527K
          Appellant                           Respondent

                   Appellant by:    Shri Vivek Batra
                   Respondent by:   Shri Dhiren K. Rathore
                                    & Shri Nitesh Joshi

                   Date of Hearing:       22.09.2014
                   Date of Pronouncement: 22.09.2014


Per D. Manmohan, V.P.

     This appeal by the Revenue is directed against the order passed by the
CIT(A)-20, Mumbai and it pertains to AY 2004-05.

2.    The only ground urged by the Revenue reads as under: -

     "On the facts and in the circumstances of the case and in law, the Ld.
     CIT(A) erred in deleting the addition of `18,01,728 disallowed by the
     Assessing Officer, overlooking the fact that the assessee had paid the
     taxes @10% on LTCG computed without indexation of its cost (book
     gain) at `15,30,144 instead of `33,31,872."

3.    Facts necessary for disposal of the appeal are stated in brief. During
the previous year relevant to the assessment year under consideration
assessee sold certain shares and earned long term capital gains. There are
in all 32 transactions. Assessee declared book gain of `11,84,425/- and paid
tax @ 10% under section 112 of the Act. The AO noticed that the book gain
works out to `33,31,872/- and after set off of carry forward of LTC loss of
`4,92,769/- assessee was to pay tax of a sum of `2,80,910/-. In the opinion
                                       2                 ITA No. 5092/Mum/2011
                                                               Ghisulal D. Rathod

of the AO, while computing the book gain, assessee is not entitled to adjust
the indexed loss. Therefore, in the proceedings under section 148 of the Act
he recomputed the capital gains.

4.    On an appeal filed by the assessee the learned CIT(A) relied upon the
decision of the Hon'ble Bombay High Court in the case of Anuj A. Sheth
(HUF) 324 ITR 191 to hold that the 32 transactions are independent, and
entered at different points of time, and hence the assessee is entitled to
claim set off of the loss from other shares.

5.    Aggrieved, Revenue is in appeal before us. At the time of hearing the
learned counsel for the assessee relied upon the decision of the Hon'ble
Bombay High Court (supra), wherein identical issue was considered and the
Hon'ble Court observed that the benefit of set off cannot be denied to
assessee merely because he has opted to be taxed under section 112 of the
Act in respect of certain shares.

6.    The learned D.R. could not point out that the decision of the Hon'ble
Bombay High Court is not applicable to the facts of the case or could
highlight that a contrary view was taken on this matter either by Supreme
Court or any High Court.

7.    Under these circumstances we are of the view that the order passed
by the learned CIT(A), being in consonance with the view taken by the
Hon'ble Bombay High Court, does not call for any interference.

8.    In the result, the appeal filed by the Revenue is dismissed.

Order pronounced in the open court on 22nd September, 2014.

                Sd/-                                     Sd/-
        (D. Karunakara Rao)                        (D. Manmohan)
        Accountant Member                           Vice President

Mumbai, Dated: 22nd September, 2014
                                       3                 ITA No. 5092/Mum/2011
                                                               Ghisulal D. Rathod

Copy to:

   1.   The   Appellant
   2.   The   Respondent
   3.   The   CIT(A) ­ 20, Mumbai
   4.   The   CIT­ 9, Mumbai City
   5.   The   DR, "G" Bench, ITAT, Mumbai

                                                      By Order

//True Copy//
                                                   Assistant Registrar
                                           ITAT, Mumbai Benches, Mumbai
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