CDR P J MATHEW Vs. INCOME TAX OFFICER

JUDGEMENT

(1.) The question raised in the appeal filed by the assessee is whether the Income Tax Appellate Tribunal was justified in holding that the sale of membership card of the appellant by the Cochin Stock Exchange attracts liability for capital gains under S.45 of the Income Tax Act (hereinafter referred for short, 'The IT Act').

(2.) We have heard Sri K. B. Mohamedkutty, Senior Counsel appearing for the appellant and the Standing Counsel appearing for the respondent.

(3.) The appellant - assessee was a member of the Cochin Stock Exchange. However, on account of chronic default, the Cochin Stock Exchange declared him a defaulter and terminated his membership and sold his stock exchange membership card in auction which fetched sale consideration of Rs.12,75,000/-. Since the membership card was sold in the previous year relevant for the assessment year 1994-95, the assessing officer brought to tax long term capital gain arising to the appellant on the sale of the Stock Exchange card. Even though the appellant's challenge against the assessment was successful before first appellate authority who allowed the appeal, on second appeal by the Department, the Income Tax Appellate Tribunal allowed the appeal and restored the assessment. It is against this order of the Tribunal, the appellant - assessee has filed this appeal under S.260A of the Act.