9911796707
TMI Blog2014 (3) TMI 365X X X X Extracts X X X X X X X X Extracts X X X X ..... Tax Act,1961. 5. The Ld. Commissioner of Income Tax (A) erred in confirming the penalty u/s. 271(1)(c) of Income Tax Act, 1961." 6. The appellant craves leave to add further grounds or to amend or alter the existing grounds of appeal on or before the date of hearing." 2. At the outset it was pleaded by Ld. AR that the issues raised in Ground No. 1 & 2 are covered by the earlier order of the Tribunal and reference was made to the order dated 17/1/2014 passed in ITA No.4030/Mum/2013 for assessment year 2007-08. Copy of order was placed on our record and was also given to Ld. DR. 2.1 It was further submitted that Ground No.3 is not pressed and Ground No.4 is regarding interest levied under section 234A, 234B and 234C of the Income Tax Act, 1961 ( the Act) which is consequential to the assessed income and, therefore, AO may be directed to recompute the interest accordingly. 2.3 Apropos Ground No.5, it was submitted that the same is premature and may be dismissed and Ground No.6 is general in nature. 3. On the other hand, Ld. DR did not object such submissions of the assessee that Ground No.1 & 2 are covered by the earlier decision of the Tribunal. 4. For the sake of completion o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The Ld. CIT(A) also observed that the rent advance in respect of first floor of the property in 2004 could not have been utilised for purchase of the property in 2002. It was also observed by Ld. CIT(A) that the assessee utilised only a sum of Rs. 29,00,000/- for acquiring the tenancy right in the said property and the contention of the assessee that the balance amount out of Rs. 51,00,000/- was utilised for undertaking repairs and renovation of the property, is not supported by any evidence. Thus the Ld. CIT(A) confirmed the action of the AO. Hence the assessee is in further appeal before the Tribunal. 5. The Ld. AR on behalf of the assessee filed a written submission giving the details of the fact, wherein it is stated that the assessee made a proposal to Saraswat Co-operative Bank Ltd. to arrange funds for acquiring the first floor premises and the bank showed interest in obtaining on rent the said premises for its banking operation. To enable the assessee to acquire the property, the Bank made an advance of Rs. 51,00,000 and termed the said amount as advance rent. The Ld. AR submitted that out of the said fund the assessee utilized a sum of Rs. 29,00,000/- for acquisition of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to the assessee bearing interest at the rate of 12% per annum with monthly rent to enable the assessee to purchase the said property and to let it out to the bank on the terms and conditions mentioned in the said letter. We also observe that the assessee on receipt of Rs. 51,00,000/- from Saraswat Bank transferred a sum of Rs. 37,00,000/- to its another bank account, ABN Amro Bank account on 11th July 2002 and on 21st August 2002 issued a cheque from ABN Amro Bank account of Rs. 29,00,000/- for acquisition of property. Therefore, we are of the considered view that the assessee utilized the sum of Rs. 29,00,000/- out of the amount received by the assessee from Saraswat Bank as advance rent for purchasing the first floor of the said premises Sailor building. The fact that the said amount was advanced by the Saraswat Bank to the assessee is not in dispute and the only dispute is as to whether the said amount advanced by Saraswat Bank to the assessee in the form of rent advance could be considered as amount borrowed by the assessee from the said Bank for purchase of the property. On consideration of terms and conditions of the letter dated 12th June 2002 (placed at pages 26 to 28 of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... allowing the set off of business loss of Rs. 27,89,564/- against income from house property. 7. The relevant facts are that the assessee is an individual engaged in the business of share trading and also derives income from house property. The assessee filed return of income declaring total income of Rs. 61,95,047/-. It is stated that during the course of assessment proceedings the assessee submitted a letter along with revised computation of income that the assessee had carried forward its business loss wrongly instead of setting off siad business loss against income from house property. It is stated that the AO did not take into account the revised computation filed by the assessee along with the letter. Being aggrieved, assessee filed appeal before first appellate authority. 8. The Ld. CIT(A) has held that the assessee furnished a copy of his return of income for assessment year 2010-11 and the balance-sheet for the said period. From the details of stock disclosed in the balance-sheet of assessment year 2010-11, it was observed that closing stock of shares as in assessment year 2007-08 and the opening stock of the assessment year 2010-11 are one and the same. The Ld. CIT(A) c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ,28,574 and society charges of Rs. 9,31,469/-, is also not allowable as no supporting documents/evidences have been produced. In view of above, the Ld. CIT(A) did not allow the claim to set off the business loss claimed by the assessee against income from house property. Hence the assessee is in further appeal before Tribunal. 9. During the course of hearing the Ld. AR submitted that the assessee due to oversight, did not claim business loss of Rs. 27,89,564/- against income from other sources. He submitted that the assessee vide letter dated 14th December 2009 pointed out mistake to the AO in the course of assessment proceedings, but the AO did not determine any loss for the year nor he set off the same against assessee's income from house property. The Ld AR submitted that during the assessment year 2005-06, the assessee had a turnover of Rs. 46,00,000/-. That the assessee was carrying on business of purchase and sale of shares regularly but due to volatile market conditions, the assessee did not undertake any business activity during the assessment year 2007-08. The Ld. AR submitted that the assessee again started purchase and sale of share activity during assessment year 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... income from house property. 9.1 On the other hand Ld. DR relied upon the order of CIT(A). 9.2 We have considered the submissions of the Ld. Representatives and carefully perused the order of Ld. CIT(A). There is no dispute to the fact that in the assessment year under consideration i.e. assessment year 2007-08, the assessee did not carry on its business of purchase and sale of shares. As per trading and P&L account for the year ending March 31st 2007, copy placed at page 7 of the paper book, the opening stock as well as the closing stock of shares remained same. The assessee stated that due to volatile market condition it did not undertake any business activity but the said business was revived or started from assessment year 2010-11. For the intervening period also, the assessee has stated that it did not carried on any activity due to uncertainty in the market condition. We also observe that prior to the assessment year under consideration, the assessee also did not carry on any activity of purchase and sale of shares. Further during the assessment year 2005-06, the assessee had a turnover of Rs. 46,00,000/- and earlier to that assessment year i.e. assessment year 2004-05 it wa ..... X X X X Extracts X X X X X X X X Extracts X X X X
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