2018 (3) TMI 1084 - HC - Income Tax

Court upholds Tribunal order for assessment years 2008-09 and 2009-10 based on share transactions.

Principal Commissioner of Income Tax-5 Versus Dipali Mahendra Shah

The court upheld the Income Tax Appellate Tribunal's order for assessment years 2008-09 and 2009-10, dismissing the appellant's challenge. The court found ... Treatment of Long Term Capital Gains as undisclosed income - addition appreciating the fact that the assessee had not carried out share transactions through stock exchange and those transactions were carried out off market - statement of Shri Mukesh M. Chokshi taken on oath u/s. 132(4) of the Act and is binding as evidence or not? - Held that:- As decided in Principal Commissioner of Income Tax-5 v. Dhwani Mahendra Shah [2017 (2) TMI 463 - ITAT AHMEDABAD] the shares were thereafter transferred to demat account. The demat account was in the name of the assessee, from where the shares were sold. In our understanding of the facts, if the shares were of some fictitious company which was not listed in the Bombay Stock Exchange/National Stock Exchange, the shares could never have been transferred to demat account. Shri Mukesh Choksi may have been providing accommodation entries to various persons but so far as the facts of the case in hand suggest that the transactions were genuine and therefore, no adverse inference should be drawn. - Decided in favour of assessee Issues:Challenge to the common order of the Income Tax Appellate Tribunal for assessment years 2008-09 and 2009-10 under section 260A of the Income Tax Act, 1961. Questions raised regarding the consideration of a statement taken under oath and the treatment of off-market share transactions as illegal and fraudulent.Analysis:The appellant-revenue challenged the common order of the Income Tax Appellate Tribunal for assessment years 2008-09 and 2009-10. The appellant proposed substantial questions of law, questioning the Tribunal's failure to consider a statement taken under oath and the deletion of additions related to off-market share transactions. Mrs. Mauna Bhatt represented the appellant, while Mr. Ruchir Patel represented the respondent.The respondent's advocate referred to a previous court order in a similar case and argued for the dismissal of the appeals based on the precedent set by that order. Mrs. Mauna Bhatt, representing the revenue, did not contest the legal position presented by the respondent's advocate. The court noted that the controversy in the present case was settled by the previous court decision, and there was no need to delve into the facts and contentions in detail.Based on the court's previous decision in a similar case, the Tribunal's order was upheld, and the appeals were summarily dismissed. The court found no legal infirmity in the Tribunal's order, thereby rejecting the appellant's challenge and concluding the case in favor of the respondent.