Principal Commissioner Of Incometax, Kolkata-2, Kolkata v. K.b. Capital Markets Pvt. Ltd

OD-19 IN THE HIGH COURT AT CALCUTTASpecial Jurisdiction (Income Tax)ORIGINAL SIDE PRINCIPAL COMMISSIONER OF INCOMETAX, KOLKATA-2, KOLKATA -Versus- K.B. CAPITAL MARKETS PVT. LTD. Appearance:Mr. Tilak Mitra, Adv.Mr. Manabendranath Bandopadhyay, Adv....for the appellant. Mr. R. K. Murarka, Adv.Ms. Sutapa Roychowdhury, Adv....for the respondents. BEFORE: The Hon’ble JUSTICE T.S. SIVAGNANAM The Hon’ble JUSTICE HIRANMAY BHATTACHARYYA Date : 15[th] February, 2022. The Court : This appeal filed by the revenue underSection 260A of the Income Tax Act, 1961 (the ‘Act’ in brevity) isdirected against the order dated 3[rd] May, 2017 passed by the IncomeTax Appellate Tribunal, “B” Bench, Kolkata (in short the‘Tribunal’) in ITA No.1303/Kol/2014 for the assessment year 2010-11. The revenue has raised the following substantial questionof law for consideration : “I) Whether on the facts and in the circumstances of thecase, the Learned Income Tax Appellate Tribunal, “B”case, the Learned Income Tax Appellate Tribunal, “B” Bench, Kolkata erred in law in holding that income ofbrokerage from dealing in shares in client accountwere to be allowed to the set off against speculationloss determined for the Assessment Year 2009-10without considering the fact that speculation losscan only be set off against speculation profit ?” We have heard Mr. Tilak Mitra, learned Counsel assistedby Mr. Manabendranath Bandopadhyay, learned Advocate for theappellant/revenue and Mr. R.K. Murarka, leaned Counsel assisted byMs. Sutapa Roychowdhury, leaned Advocate for therespondent/assessee. The learned counsel appearing for the respondent/assesseesubmits that the appeal cannot be pursued by the revenue as thetax effect would be less than Rs.1 crore. In order to demonstrateas to how the tax effect is less than Rs.1 crore, a calculationsheet has been handed over to us wherein it is stated thatassuming this appeal is allowed and the assessment order isrestored, the tax effect will be only Rs.62,11,401/- and,according to the Circular dated 8[th] August, 2019 issued by theCentral Board of Direct Taxes (CBDT), revenue cannot pursue thisappeal. The learned counsel for the respondent/assessee has alsodrawn our attention to the order giving effect to the order underSection 250 of the Act dated 31[st] October, 2014 and it isdemonstrated that assuming this appeal is allowed in favour of therevenue, the tax effect will be Rs.62,54,160/-. The learnedcounsel for the respondent has handed over a letter sent by the Deputy Commissioner of Income Tax, Circle-4(1), Kolkata to thePrincipal Commissioner of Income Tax, Kolkata-2, dated 15[th]September, 2021, in the subject column of the said letter, thecase number has been mentioned as ITAT/35/2017 whereas the appealbefore us is ITAT/42/2018 though the assessee appears to be thesame company. The total disputed tax, according to the saidcommunication, is Rs.1,67,18,489/- (approximately). Thus, thereare two versions before us. Hence, we peruse the order passed bythe Commissioner of Income Tax (Appeals)-VI, Kolkata (CIT(A) dated28[th] March, 2014. In the said appeal, the tax demanded has beenmentioned as Rs.89,88,840/-. The assessee was successful beforethe CIT(A) which order has been affirmed by the tribunal.Therefore, assuming this appeal is allowed in favour of therevenue, the tax effect cannot be more than Rs.89,88,840/-.Therefore, this appeal cannot be pursued by the revenueon the ground of low tax effect. Accordingly, the appeal standsdismissed and the substantial question of law is left open.Consequently, the application for stay also standsclosed. (T.S. SIVAGNANAM, J.) (HIRANMAY BHATTACHARYYA, J.)