: 1 : IN IN IN THE HIGH COURT OF JUDICATURE AT BOMBAY THE HIGH COURT OF JUDICATURE AT BOMBAY THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORDINARY ORDINARY ORIGINAL CIVIL JURISDICTION ORIGINAL CIVIL JURISDICTION ORIGINAL CIVIL JURISDICTION INCOME INCOME INCOME TAX APPEAL NO.748 OF 2007 TAX APPEAL NO.748 OF 2007 TAX APPEAL NO.748 OF 2007 The Commissioner of Income Tax, . Central-IV, Mumbai ...Appellant V/s. Nirmal Bang Security Pvt. Ltd., Mumbai ...Respondent Mr.B.M. Chatterjee with Mrs.P.P. Bhosale, Advocates, for the Appellant. Mr.Murlidharan with Mr.A.K. Jasani, Advocates, for the Respondent. CORAM CORAM CORAM : DR. S. RADHAKRISHNAN & : DR. S. RADHAKRISHNAN & : DR. S. RADHAKRISHNAN & A.V. A.V. A.V. NIRGUDE, JJ. NIRGUDE, JJ. NIRGUDE, JJ. DATE DATE DATE : 30TH JUNE, 2008. : 30TH JUNE, 2008. : 30TH JUNE, 2008. P.C. P.C. P.C. : : : . Heard the learned Counsel for the Appellant and the learned Counsel for the Respondent. 2. By the above Appeal, the Appellant has sought to raise the following substantial questions of law:- (a). Whether on the facts and the circumstances of the case the special Bench of the Tribunal was justified in law in holding the transactions of the purchase of the units of mutual funds a few days before the record date for the dividend entitlement and its sale : 2 : immediately after the record date as business transactions when it was a foregone conclusion that the transactions would result in a loss to the assessee? (b). Whether on the facts and the circumstances of the case, the special Bench of the Tribunal was justified in law in holding the transactions of the purchase and sale of units of Mutual funds as business transactions when as per the modern view of the law, the assessee is not permitted to avoid tax incidence, even if nothing that the assessee does, is either illegal or downright dishonest? (c). Whether on the facts and in the circumstances of the case, the Special Bench of the Tribunal was justified in law in holding the transactions of the purchase and sale of units of Mutual funds as business transactions when the transactions put through by the assessee need not have been taken in order to achieve a commercial result or object, but were taken only with a view to reducing the tax burden and hence though such : 3 : transactions or steps may be legal and actually put through, they are hollow and colourable devices? (d). Whether on the facts and in the circumstances of the case, the Special Bench of the Tribunal was justified in law in holding the assessee was not disentitled to have the loss from the transactions of purchase and sale of units of mutual funds set off against his income from any other transactions or source when the said transactions were purely hollow and colourable devices and the result of such transactions and necessarily to be ignored in computing the total income of the assessee? (e). Whether on the facts and in the circumstances of the case, the Hon.ITAT was justified in holding that the addition on account of diversion of profits of Rs.18,93,048/- for A.Y.2000-01 and Rs.33,500/- for the A.Y.2001-02 does not fall within the definition of undisclosed income u/s.158B(b) of the Act? : 4 : (f). Whether on the facts and in the circumstances of the case, the Hon.ITAT was justified in holding that the addition on account of disallowance of brokerage of Rs.1,61,592/- does not fall within the definition of undisclosed income u/s.158(B)(b) of the Act? (g). Whether on the facts and in the circumstances of the case, the Hon.ITAT was justified in holding that the addition of Rs.22,426/- on account of dividend received does not fall within the definition of undisclosed income u/s.158B(b) of the Act? 3. The learned Counsel appearing on behalf of the Respondent pointed out that in view of the Judgment of this Court in the case of Commissioner of Income-Tax V/s. Vikram A. Doshi & Anr. [256 ITR 129], the above substantial questions of law does not arise at all. In that behalf the learned Counsel for the Respondent brought to our notice the following observations in the aforesaid Judgment :- "The other questions sought to be raised by the Revenue need no consideration as the issues raised : 5 : therein are based on transactions which, by no stretch of imagination can be said to be undisclosed transactions falling under section 158B of the Income-Tax Act, since the transactions in question were disclosed in returns which were the subject-matter of regular assessment. The same ought to have been assessed in the regular assessment and not in the block assessment. We, therefore, affirm the conclusions or findings recorded by the Tribunal with respect to those transactions referred to in other questions sought to be canvassed, may be for additional different reason recorded herein." 4. In view of this, we do not find any substantial question of law involved in the above Appeal and the same is dismissed. [A.V. [A.V. [A.V. NIRGUDE, J.] [DR. S. RADHAKRISHNAN, J.] NIRGUDE, J.] [DR. S. RADHAKRISHNAN, J.] NIRGUDE, J.] [DR. S. RADHAKRISHNAN, J.]