9911796707
TMI Blog2013 (6) TMI 501X X X X Extracts X X X X X X X X Extracts X X X X ..... The Assessing Officer made adequate enquiries during the course of assessment proceedings. In support of this contention, he referred to the assessee's reply dated 15.02.2010, 19.08.2010, 01.09.2010 and 16.09.2010. All these replies are placed in the assessee's paper book from page 11 onwards. He further stated that in the earlier year i.e. AY 2006-07, there was a loss from sale of shares which was offered as short term capital loss and the same was claimed to be carried forward. This claim of the assessee was accepted. In AY 2007-08, the income from sale of shares offered as capital gain was duly accepted in the order passed under Section 143(3). That even in the subsequent year, i.e. AY 2009-10, of course in the order under Section 143(1), again the income from sale of shares is accepted as capital gain. That the view taken by the Assessing Officer in the year under consideration was the consistent view of the Revenue in the earlier year as well as preceding years and, therefore, it cannot be said that the assessment order was erroneous or prejudicial to the interest of the Revenue. He further submitted that the assessee is a salaried employee and the income from sale of shares ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dent that the only ground given by learned CIT for setting aside the assessment was not making of proper enquiry by the Assessing Officer and non-application of mind by him. So, let us examine whether the Assessing Officer had examined this issue or not. At page 11 of the assessee's paper book, there is a reply dated 15th February, 2010. Paragraph No.2 of the reply reads as under:- "During the year the assessee has derived income mainly from capital gain on investment in securities and mutual funds, interest and income from dealing in futures and options. During the year the assessee has also earned income from commission also." 7. In its reply dated 19th August, 2010, again in paragraph 1, the assessee reiterates that the assessee derives income from investment in shares. In reply dated 1st September, 2010, assessee enclosed copy of brokers account, party-wise trade register, transaction statements, relevant copy of bank account and copy of transaction ledger delivery basis. Again on 16th September, 2010, the assessee furnished various details as well as the explanation why it should be assessed as capital gain. The relevant reply is reproduced below:- "1 - In respect of short- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eld as capital assets/investments by the assessee as discussed hereinabove, and accordingly the profit on sale of investment has been treated as capital gain in accordance the provisions of the Act and applicable taxes were paid by the assessee. Complete details of investment/sale/purchases have been duly disclosed in the Profit & Loss account & Balance Sheet. The assessee has also not claimed any rebate u/s 88E of the Act in respect of STT paid on the transactions treated as capital assets. It is also to be mentioned that the assessee has not entered into any F&O transactions through Portfolio Managers. F&O has been dealt with Alankit Assignments Ltd. only." 8. From the above, it is evident that sufficient enquiries were conducted by the Assessing Officer from time to time. He examined the transactions entered into by the assessee by calling the brokers account, party-wise trade register, delivery register, bank statements etc. He also asked the assessee to explain why the income is to be assessed as short term capital gain, in response to which, vide paragraph 3 of its reply dated 16th September, 2010, the assessee furnished detailed explanation in which the assessee has pointed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t may accept the assessee's claim and in the year in which there is short term capital gain, it can claim that it should be assessed as business income. That in the case of Malabar Industrial Co.Ltd. (supra), Hon'ble Apex Court held as under:- "The scheme of the Act is to levy and collect tax in accordance with the provisions of the Act and this task is entrusted to the Revenue. If due to an erroneous order of the Income-tax Officer, the Revenue is losing tax lawfully payable by a person, it will certainly be prejudicial to the interests of the Revenue. The phrase "prejudicial to the interests of the Revenue" has to be read in conjunction with an erroneous order passed by the Assessing Officer. Every loss of revenue as a consequence of an order of the Assessing Officer, cannot be treated as prejudicial to the interests of the Revenue, for example, when an Income-tax Officer adopted one of the courses permissible in law and it has resulted in loss of revenue, or where two views are possible and the Income-tax Officer has taken one view with which the Commissioner does not agree, it cannot be treated as an erroneous order prejudicial to the interests of the Revenue unless the view t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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