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08-01-2019, Dhruv Kumar Khaitan, Section 147, 49(1)(iii)(b), Tribunal Mumbai

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5 months 1 week ago #8328 by amit
Section - 147, 49(1)(iii)(b), 45(4), 151
Order Date - 08-01-2019
Favouring - Assessee Partly
Court - Tribunal Mumbai
Appellant - ACIT
Respondent - Dhruv Kumar Khaitan
Justice - C.N. PRASAD JM & RAJESH KUMAR AM
Citation - 119Taxpundit124
Appeal No. - ITA NO.583/MUM/2016
Asstt. Year - 2006-07

Order

PER : C.N. PRASAD (JM)

1. These are the appeals and cross objections filed by the revenue and the assessees against the separate orders passed by the Ld. Commissioner of Income Tax (Appeals)- 33, Mumbai [hereinafter in short as Ld. CIT(A)] dated 03.11.2015, for the assessment year 2006-07 arising out of the order passed u/s 143(3) r.w.s. 147 of the Income Tax Act, 1961. Since common issues are involved in these appeals / cross objections, they are being clubbed and heard together and a consolidated order is passed for the sake of convenience.

2. As the dispute in case of both the assessees are similar we first takeup the cross appeals in case of Shri Dhruv Kumar Khaitan in ITA.No. 583/Mum/2016 & CO.NO.135/Mum/2017.

ITA NO.583/MUM/2016 & CO NO.135/MUM/2017:

3. In this case, revenue has raised the following grounds of appeal: -

“1. On the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in deleting the addition u/s 68 of the Income Tax Act, 1961 made by Assessing Officer.

2. On the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in treating the income of Short Term Capital Gain as long term capital gain.

3. On the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in treating the income of Rs. 4,96,40,000/- as Long Term Capital Gain and allowing deduction u/s 54F of the Income Tax Act, 1961.

4. The appellant prays that the order of Ld. CIT(A) on the above grounds be set aside and that of the AO be restored.

5. The appellant craves leave to amend or alter any ground or add a new ground, which may be necessary.”

4. Grounds of cross objection raised by the assessee read as follows:

1. “The Ld. CIT (A) erred in upholding reopening of assessment u/s 148 without appreciating that:

i) The original assessment was completed u/s 143(3) and the assessment was reopened beyond four years and there was no failure on part of the assessee to disclose truly and fully all material facts required for assessment. Therefore, as per proviso to section 147, such reopening is invalid.

ii) The original assessment was made u/s 143(3) and after original assessment no new tangible material has come into possession of the Assessing Officer which is even confirmed by the Assessing Officer in the remand report. Therefore, such reopening of the assessment is nothing but “change of opinion”, hence, invalid.

iii) There was no “reason to believe” as there was no material to prove that income has escaped assessment.

2. The Ld. CIT (A) erred in not deciding the alternate contention of the assessee on merit that if cost of shares received from private trust is treated as “gift”, even in that case, resultant profit is Long Term Capital Gain (LTCG), hence, eligible for exemption u/s 54F.

3. The Ld. CIT (A) erred in not deciding the alternate contention of the assessee on merit that if cost of shares received by the assessee from private trust is not determinable; in that case, Capital Gain cannot be computed; in the absence of computation, charge also fails as held by the Hon’ble Supreme Court in the case of CIT Vs. B.C. Srinivas Shetty reported in 128 ITR 294 (SC).

4. The Respondent prays that reopening of assessment may be quashed and held to be void ab-initio and on merits such additions made may be deleted.

5. The respondent craves leave to add, alter or amend any or all the above grounds of cross-objection at the time of hearing or before.”

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