2020 (3) TMI 607 - HC - Income Tax

Rectification of mistake u/s 254 - Profit from sale of shares - assessee had shown long term and short term capital gains on sale of shares, which were earlier, held as stock-in-trade - Business income u/s.41(l) - difference between the book value of shares held as stock-in-trade as on 31.03.2002 and the cost thereof at which the same were converted into investments on 1.4.2002 - HELD THAT - HELD THAT - We find that while passing the order dated 30.05.2018 2018 (5) TMI 1977 - ITAT MUMBAI Tribunal had dismissed the appeal of the petitioner for the assessment year 2006- 07. There was omission to deal with the appeal of the petitioner for the assessment year 2003-04 2018 (5) TMI 1977 - ITAT MUMBAI That being the position and on due consideration, we interfere with the impugned order 2019 (4) TMI 1842 - ITAT MUMBAI passed by the Tribunal to the effect that order. 2018 (5) TMI 1977 - ITAT MUMBAI would stand recalled qua both the grounds

Summary

Issues involved:
1. Appeal against the impugned order dated 12.04.2019 passed by the Income Tax Appellate Tribunal, Mumbai Bench.
2. Failure to adjudicate on the appeal filed for the assessment year 2003-04.
3. Recalling the order dated 30.05.2018 regarding the grounds in the appeal for the assessment year 2003-04.

Detailed Analysis:
1. The petitioner filed a petition under Article 226 of the Constitution of India challenging the order passed by the Income Tax Appellate Tribunal for the assessment year 2003-04. The petitioner raised two grounds before the Tribunal, questioning the legal validity of reassessment proceedings and challenging the addition made by the assessing officer. The Tribunal dismissed the appeal for the assessment year 2006-07 and the appeal of the revenue for the same year. However, the Tribunal failed to address the appeal for the assessment year 2003-04. Subsequently, the petitioner filed an application under Section 254(2) of the Act to correct the omission. The Tribunal partly allowed the application but omitted to consider ground No.2 of the appeal for the assessment year 2003-04, leading to the filing of the present writ petition.

2. The High Court carefully reviewed the order passed by the Tribunal and the grounds raised by the petitioner in both appeals. It was observed that while the Tribunal had dismissed the appeal for the assessment year 2006-07 and the revenue's appeal for the same year, there was a failure to address the petitioner's appeal for the assessment year 2003-04. Considering this omission, the High Court interfered with the impugned order passed by the Tribunal and directed the recall of the order dated 30.05.2018 concerning both grounds in the appeal for the assessment year 2003-04. The High Court ordered the Tribunal to hear the appeal for the assessment year 2003-04 in accordance with the law, thereby allowing the writ petition without costs.