9911796707
TMI Blog2024 (10) TMI 744X X X X Extracts X X X X X X X X Extracts X X X X ..... as well as applicable case laws have elaborately been dealt with by the co-ordinate bench in its order. The bench has not only considered the validity of revisionary jurisdiction u/s 263 but also decided the issue on merits. After much deliberation, the impugned issue has ultimately been decided in assessee s favor. The case law in the case of CIT vs. Dr. M.A.M. Ramaswamy [ 2015 (1) TMI 439 - MADRAS HIGH COURT] has elaborately been distinguished by Ld. Sr. Counsel in its written submissions. The same has already been deliberated upon by us in preceding paragraphs. The same found our concurrence. Nothing has been shown to us that the aforesaid decision of Mumbai Tribunal has been reversed by higher judicial authorities in any manner or the s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ready been disposed-off by us. In the above background, this appeal is disposed-off as under. 3. The assessee being a partnership firm is stated to be carrying on the business of distribution of lottery tickets. The assessee earned prize money on unsold lottery tickets which was credited to Profit Loss Account and the same was offered as business income. After claiming various expenditures, the assessee reflected business income of Rs. 9.42 Lacs. 4. The Ld. AO, considering the provisions of Sec.2(24)(ix) r.w.s. 56(2)(ib) Sec.58(4) concluded that such winning from lotteries from unsold lottery tickets would be separately chargeable to tax at the rate of 30% in terms of Sec.115BB r.w.s. 58(4). The assessee is not permitted to claim any expend ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at the assessee intentionally held the tickets with it to participate in the lottery scheme on its own. It is also evident that TDS has been deducted u/s 194B at higher rates of 30%. If the prize money was out of trading stock that remained unsold, then TDS should have been deducted u/s 194G at lower rate of 5%. Having reported the winnings separately by the assessee in its financial statements, AO was right is taxing the same u/s 2(24)(ix) and apply consequential provisions. It has also been urged by the revenue that the aforesaid decision of Mumbai Tribunal was in the context of challenge to revisionary jurisdiction u/s 263 and therefore, Ld. CIT(A) should have adjudicated the issue with independent application of mind. The Ld. Sr. DR als ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... here is no such restriction of set-off of business loss against income from lottery either u/s 70 / 71 / 74A or u/s 115BB of the Act. Prior to Finance Act, 1986, subsection (1) and (2) to Sec.74A provided that the loss from lotteries etc. shall be set-off against income from lotteries only. By the Finance Act, 1986, these two sub-sections were omitted and thus, the bar on set-off of losses was removed. Second distinction is the fact that, in that case, the assessee did not contend that betting income would be income from owning and maintaining of the horse races. However, in the present case, the winnings realized on unsold tickets are realization of closing stock of unsold lottery tickets. This prize money so earned by the assessee was bus ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... case laws have elaborately been dealt with by the co-ordinate bench in its order. The bench has not only considered the validity of revisionary jurisdiction u/s 263 but also decided the issue on merits. After much deliberation, the impugned issue has ultimately been decided in assessee s favor. The case law of Hon ble High Court of Madras in the case of CIT vs. Dr. M.A.M. Ramaswamy (53 Taxmann.com 231) has elaborately been distinguished by Ld. Sr. Counsel in its written submissions. The same has already been deliberated upon by us in preceding paragraphs. The same found our concurrence. Further, nothing has been shown to us that the aforesaid decision of Mumbai Tribunal has been reversed by higher judicial authorities in any manner or the ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
