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2015 (12) TMI 504 - ITAT DELHI

2015 (12) TMI 504 - ITAT DELHI - TMI - Validity of assessment order - CIT(A) held it as bad in law as so called other order was merely an untenable and concocted story which is non-cognizable and had no legal sanctity - Held that:- if the alleged order bears same DCR No.151/380 on the subsequent demand notice, then it may safely be inferred that allegations made by the ld. AR are correct that the Assessing Officer erred in framing the second order of the same date which was prejudicial to the as .....

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eld that:- When the Assessing Officer himself went wrong in holding valid service of notice and did not decide the legal objection of the assessee, the CIT(A) was quite balanced and justified in holding that the valid service of notice within time comes under serious doubt as the Assessing Officer has not brought out any fact on record to support valid service of notice on the assessee. Hence, we are unable to see any valid reason to interfere with the conclusion of the CIT(A) on this issue and .....

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ssessee could get the benefit of valuation loss or rebate u/s 88E of the Act, the Assessing Officer can not label the assessee as dealer in shares and thus income derived therefrom cannot be treated as business income. The dicta laid down by Hon'ble High Court in the case of Jubilant (2011 (3) TMI 607 - DELHI HIGH COURT ) was followed and the CIT(A) granted relief to the assessee on justified and correct appreciation of fact and we are unable to see any valid reason to interfere with the same. - .....

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itted that the CIT(A) has erred in holding that the assessment order is bad in law as so called other order was merely an untenable and concocted story which is non-cognizable and had no legal sanctity. 3. Learned counsel of the assessee supported the impugned order and submitted that it was a very bad practice to substitute a new order in the place of earlier order which has been passed on the back of the assessee which was not only bad in law but void ab initio. 4. On careful consideration of .....

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ds in one volume was called for from the ACIT, Circle 1. The allegation made through the Grounds of Appeal is serious. The AR has placed on record a copy the assessment order of the ITO, Ward 1(2), Meerut dated 19.12.2008 in which returned income has been accepted. It is duly signed by the AO and bears his seal. It also bears DCR No.151/230. Demand of ₹ 26,380/- raised through this order has been paid for which the AR has placed copy of challan dated 10.1.2009 on record. The order under ap .....

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he ld. AR are correct that the Assessing Officer erred in framing the second order of the same date which was prejudicial to the assessee in comparison to earlier order. We may point out that the conduct of the Assessing Officer was dignified and judicious and the CIT(A) rightly held that second order under appeal is bad in law. The CIT(A) was also quite balanced and justified in drawing attention of CIT, Meerut to this serious issue. We are unable to see any reason to interfere with the impugne .....

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y additional evidence during first appellate proceedings. 7. On careful consideration of rival submissions and vigilant perusal of the impugned order, we note that the assessee did not file any application under Rule 46A of the Rules seeking admission and consideration of any additional evidence. The so-called earlier assessment order was in fact a matter of revenue record which cannot be said to be additional evidence, thus ground no. 3 of the revenue being devoid of merits is dismissed. Ground .....

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t appellate order. 10. On careful consideration of above, at the outset, we note that the CIT(A) decided the issue in favour of the assessee with following findings:- 5.2 Decision and reasons therefor: I have perused the material on record. The assessment record shows that a notice under section 143(2) dated 27.9.2007 sent by speed post was returned unserved as per the noting of the postal staff dated 28.9.2007 on the envelope. Yet another notice of the same date is found on record which is show .....

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y served. In the order in which he has accepted the returned income, the A.O. has not mentioned the fact of service at all. In view of the circumstances of the proceedings, the valid service of notice within time comes under serious doubt. 11. In view of above, when the Assessing Officer himself went wrong in holding valid service of notice and did not decide the legal objection of the assessee, the CIT(A) was quite balanced and justified in holding that the valid service of notice within time c .....

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that the income earned by the assessee on sale and purchase transactions of shares was capital gain ignoring the frequency of the transactions of shares, its volume and continuity. Ld. DR supported the action of the Assessing Officer and placed his reliance on the various orders and judgements including judgment of Hon ble Jurisdictional High Court of Delhi in the case of CIT vs Sahara India Housing Corp. Ltd. (2012) 81 CCH 0063 (Del H.C.). 13. Ld. AR strongly supported the impugned order of CI .....

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ted relief to the assessee with following conclusion:- 6.4. Decision and reasons therefor: I have carefully considered the reasons discussed by the A.O. in the impugned order for assessing the gain on the sale of shares as profits and gain of business as against Capital gains claimed by the assessee. The A.O. has observed in the Assessment order as under: a. During the year the Assessee has made 97 transactions of the sale and purchase of shares through Kotak Securities and 370 transactions thro .....

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not a Long Term or Short Term Capital gain as claimed by the Assessee but a business Income. Thus, after going through the above observations of the AO it is quite obvious that he has converted the head of business in a very casual way and has not brought on record any concrete material for the view which he has taken in the assessment. I have also gone through the explanations and submissions of the AR. The assessee did not record the investments in his accounts by way of stock-in-trade. The as .....

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had not claimed the Securities Transactions Tax (STT). Even though the A.O. treated the appellant to be dealer in shares, AO did not allow the rebate u/s 88 E of the Act . In this factual back ground, I find that when the assessee could get benefit of valuation loss or rebate u/s 88 E , the A.O. did not regard the appellant to be a dealer in shares. I find also that the assessee s conduct all through was uniform. The assessee accounted for the investments in his books at cost and no valuation lo .....

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