Rashi Agarwal v. Dr. Justice B.r. Sarangi Mr. Justice G. Satapathy

IN THE HIGH COURT OF ORISSA AT CUTTACK ITA No.85 of 2023 …..Appellant …..Principal Commissioner of Income AppellantTax-1, Bhubaneswar Mr. S.C. Mohanty, Sr. Standing Counsel, Income Tax Deptt. Rashi Agarwal Vs. …..Respondent CORAM: DR. JUSTICE B.R. SARANGI MR. JUSTICE G. SATAPATHY ORDER19.06.2024 Order No. 3 This matter is taken up by hybrid mode. 2. Heard Mr. S.C. Mohanty, learned Senior Standing Counsel appearing for the appellant-Income Tax Department. 3. The appellant has filed this appeal seeking to quash the order dated 04.05.2023 passed in ITA No.56/CTK/2023 for the assessment year 2014-15 under Annexure-1, by which the Income Tax Appellate Tribunal, Cuttack Bench, Cuttack has allowed the said appeal filed by the respondent-assessee. 4. Mr. S.C. Mohanty, learned Senior Standing Counsel appearing for the appellant-Income Tax Department vehemently contended that the Income Tax Appellate Tribunal, Cuttack Bench, Cuttack, relying upon the judgment in Deepansu Mohapatra & Ors. in ITA Nos.42 & 43/CTK/2020 and other connected appeals, has allowed ITA No.56/CTK/2023 under Annexure-1. It is contended that the said ratio decided by the Coordinate Bench of the Tribunal is to be considered in different cases differently. Therefore, the order dated 04.05.2023 passed in ITA No.56/CTK/2023 under Annexure-1 should be interfered with by this Court. 5. Perused the record. It appears that the respondent-assessee is an individual, who is deriving income from capital gains from purchase and sale of shares. The assessee purchased 1 lakh shares @ Rs.1/- of M/s. Panchshul Marketing Ltd. on 29.03.2012. In view of the decision of the Bombay High Court, the said company was amalgamated with M/s. Kailash Auto on 24.01.2013. Consequent upon the amalgamation, 1 lakh shares of M/s. Kailash Auto was issued to the assessee in lieu of 1 lakh shares in his damat account. The shares of M/s. Panchshul Marketing Ltd. had been purchased by the assessee from M/s. Brijdhara Mercantile Pvt. Ltd. The purchase of shares of M/s. Panchshul Marketing Ltd. was an off-market purchase. Subsequently, the shares of M/s. Kailash Auto were sold on various dates, i.e., from 18.02.2014 to 06.03.2014 at an average price of about Rs.38/- per share. The assessee had consequently disclosed Rs.38 lakhs received by him as exempt under Section 10(38) of the Income Tax Act. The shares were sold through Inter Connected Stock Exchange of India Ltd. and STT (Securitisation Transaction Tax) had also been paid. The Inter Connected Stock Exchange of India Ltd. had sold the shares through BSE. Under identical circumstances, the Coordinate Bench of the Tribunal in the case of Deepansu Mohapatra & Ors. in ITA Nos.42 & 43/CTK/2020 along with other connected appeals, vide order dated 21.12.2021, following the various decisions of the High Courts, held that the assessee, having purchased the equity shares through account payee cheques, the shares have been held in demat account and shares have been held for 12 months and sold through recognized stock exchange after payment of STT, was entitled to the exemption under Section 10(38) of the Income Tax Act. In the said case also it was the sale of equity shares of M/s. Kailash Auto, which has been considered by the Coordinate bench of the Tribunal. Similar view was also taken by the Coordinate Bench, Mumbai in Ramprasad Agarwal v. Income Tax Officer in ITA No.1228/M/2018. was the sale of equity shares of M/s. Kailash Auto, which has been considered by the Coordinate bench of the Tribunal. Similar view was also taken by the Coordinate Bench, Mumbai in Ramprasad Agarwal v. Income Tax Officer in ITA No.1228/M/2018. 6. Therefore, relying upon the judgment passed by the Coordinate Bench of the Tribunal in Deepansu Mohapatra (supra) in ITA Nos.42 & 43/CTK/2020 and other connected appeals, disposed of vide order dated 21.12.2021, which has been confirmed by this Court, the Single Member of the Income Tax Appellate Tribunal, Cuttack Bench, Cuttack, came to a conclusion that the assessee is entitled to get the benefit and allowed the appeal filed by the assessee. It is also revealed that the Department has not challenged the confirmation order passed by this Court before the apex Court. Thereby, the order passed by the Coordinate Bench of the Tribunal reached its finality. Accordingly, this Court does not find any error in the order dated 04.05.2023 passed by the Income Tax Appellate Tribunal, Cuttack Bench, Cuttack in ITA No.56/CTK/2023. 7. Accordingly, the Income Tax Appeal merits no consideration and the same is dismissed. (DR. B.R. SARANGI) JUDGE Alok (G. SATAPATHY) JUDGE Signature Not Verified Digitally SignedSigned by: ALOK RANJAN SETHYDesignation: A.R-cum-Sr. SecretaryReason: AuthenticationLocation: ORISSA HIGH COURTDate: 20-Jun-2024 11:29:50