9911796707
TMI Blog2017 (5) TMI 1422X X X X Extracts X X X X X X X X Extracts X X X X ..... fforded to the assessee as per the proviso to section 144A of the Act. Unfortunately the Additional CIT has not afforded any opportunity of being heard before issuing such directions. Thus it is of the view that capital gain computed pursuant to the directions of the Additional CIT deserves to be set aside. Accordingly set aside the order of the AO passed consequent to the directions of the Additional CIT for computing the capital gain and restore the matter to the file of the AO to recompute the capital gain after affording an opportunity of being heard to the assessee. If the AO feels that the direction of Additional CIT is to be complied with, he may place the matter before the Additional CIT to first afford opportunity of being heard to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o the appellant without giving an opportunity of being heard and in violation of the proviso to section 144A. Further, the impugned directions having been issued after the last date of hearing, The impugned directions so issued and the order passed in accordance with the said invalid directions is bad in law and liable to be quashed. The learned Commissioner of Income tax (Appeals) -5, Bengaluru has erred in not adjudicating on this matter. 1.4 In any case and without prejudice, the learned Assistant Commissioner of Income tax, Circle 15(1), Bengaluru has erred in (i) Treating 6000 options transferred to Infosys Technologies Limited as short term capital asset instead of 2250 options as declared by the appellant in his return of income ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ant received 7,250 options (not shares) on different dates, out of which 1,250 options were exercised on 16.11.2005 and the remaining 6000 options were transferred as such (without exercising the options) under the option transfer agreement dated 07.03.2007. 1.7 On facts and in the circumstances of the case and law applicable, the assessment of capital gains of ₹ 20,41,672 as short term capital gains is to be deleted and the gains are to be taken as long term capital gains and further exemption claimed u/s 54EC should be allowed as claimed in the return of income. 1.8 Without prejudice to the above, the learned Commissioner of Income tax (Appeals) - 5, Bengaluru has observed that 'exercise' of an option is the process by w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hearing, the learned Counsel for the assessee has assailed the assessment order computing the capital gains pursuant to the directions of the Additional CIT issued under section 144A of the IT Act (hereafter called the "Act"). The learned Counsel for the assessee further contended that as per provisions of Section 144A, the Additional CIT is required to afford an opportunity of being heard to the assessee before issuing such directions which are prejudicial to the assessee. The claim of the assessee with regard to the long term and short term capital gain was not accepted by the Additional CIT and the AO was directed to compute the short term capital gain on transfer of stock options by the assessee of the appellant company. The assessee h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nity is given to the assessee to be heard. Admittedly, the assessment was framed consequent to the directions issued by the Additional CIT and as per the directions, claim of the assessee for computing the long term capital gain was to be rejected and it was to be computed as a short term capital gain, meaning thereby that the directions of the Additional CIT was prejudicial to the assessee and before the issue of the same, an opportunity of being heard should have been afforded to the assessee as per the proviso to section 144A of the Act. Unfortunately the Additional CIT has not afforded any opportunity of being heard before issuing such directions. Thus I am of the view that capital gain computed pursuant to the directions of the Additio ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
