RAJ RANI GULATI Vs. CIT CENTRAL TILAK

JUDGEMENT

(1.) This appeal under section 260A of the IT Act has been filed by the assessee against the judgment and order dated 29-12-2006 passed by the Tribunal in ITA No. 187/Luck/2006 for the assessment year 2001-02. On 24-7-2007, a Co-ordinate Bench of this Court has admitted the present appeal on the following substantial questions of law :

(2.) The brief facts of the case are that during the assessment year under consideration, the assessee had sold 16,000 equity shares of M/s Viraj Credit Capital Ltd. on 15-9-2000 for a consideration of Rs. 14,91,320 which was purchased for Rs. 88,168 on 3-7-1999. The sales resulted in long-term capital gain of Rs. 12,34,006. At the rate of 20 per cent, which was shown by the assessee on the basis of indexation, the AO accepted long-term capital gain and passed assessment order on 25-3-2004. However, being aggrieved, the assessee has filed an appeal before the first appellate authority, where a legal ground was raised that the long-term capital gain will have to be computed @ 10 per cent as per the proviso of section 112(1) of the IT Act. The assessee also submitted an application dated 4-4-2005 under rule 46A(1)(c)/(d) of the IT Rules to this effect. Finally, the first appellate authority has accepted the plea of the assessee and directed the AO to compute the long-term capital gain @ 10 per cent in accordance with the Circular No. 14 (XL-35) dated 11-4-1955 read with proviso to section 112(1) of the Act.

(3.) Not being satisfied, the Department has filed an appeal before the Tribunal, who observed in its impugned order that the assessee has shown the long-term capital gain @ 20 per cent. The assessee has not filed any revised return, so assessee cannot raise the ground before the first appellate authority. By relying on the ratio laid down by Hon'ble Supreme Court in the case of Goetze (India) Ltd. v. CIT, 2006 284 ITR 323, the appeal of the Department was allowed. Being not satisfied, the assessee has knocked the door of this Court by filing the present appeal.