DCIT Vs Naresh Laxminarayan Grover (ITAT Nagpur)
ITAT Nagpur held that short term capital gain tax paid under section 111A @15% cannot be reclassified as taxable under section 68 read with section 115BBE of the Income Tax Act without any basis. Accordingly, appeal of revenue dismissed.
Facts- The Assessing Officer added back Rs. 3,11,34,325 under section 68 of the Income Tax Act, 1961 holding short term capital gain considered to be not genuine. Assessee contested before CIT(A) that all the relevant details were submitted before AO and therefore reopening of assessment amounts to ‘mere change of opinion’ and hence the same is illegal. CIT(A) granted relief to the assessee. Being aggrieved, revenue has preferred the present appeal.
Conclusion- Held that when the assessee has paid tax on short term capital gain under section 111A @15%, the Assessing Officer is reclassifying the same to be taxed under section 68 r/w section 115BBE of the Act without any basis. This cavalier attitude of the Assessing Officer cannot be countenanced in the absence of any worthwhile enquiry. There is no scope to tinker with the well–reasoned order passed by the learned CIT(A). The final acquittal order of the SEBI for all these three companies are like a final nail on the coffin and dispel all doubts and aspersions castigated by the Assessing Officer. For other two assessment years, transactions were made in same companies. But long term capital gain was generated and short term capital loss had also crystallised. Be that as it may, there will be no difference in the final conclusion drawn in the appeal being ITA no.524/Nag./2024, for the assessment year 2014–15, because the evidences submitted are fairly applicable for these years also and the Department has failed to impeach the credibility thereof.
