TaxTMI 
TaxTMI 
2008 (8) TMI 415
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....dition of Rs. 3,35,000 on account of unaccounted commission paid to the broker to fetch the accommodation entries of long-term capital gains on shares." 2. Both the parties were heard regarding the issues raised by the assessee and its legal implications. 3. During the course of the hearing learned Departmental Representative has vehemently argued supporting the case of the Department and relying on orders passed by the AO contending inter alia that the AO has made out voluminous evidence to show that the assessee's claim of long-term capital gains is totally incorrect insofar as the assessee is not able to prove either the purchase of the shares or sale of the same and thereby earning the huge amount of Rs. 66.90.330 as sale proceeds....
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....ly unsustainable under law and required to be set aside by restoring that of the AO. Accordingly he sought for allowing the appeal of the Department. 4. Contrary to this the learned Authorised Representative of the assessee has vehemently argued contending inter alia that the assessee has proved the purchase as well as sale of the shares in question by producing the intimation issued by the broker who carried out the purchase and sale of the shares on behalf of the assessee and also producing the statement of account of the assessee with the said broker which categorically discloses that the sale proceeds of shares of the assessee are continuously lying with the broker and out of that proceeds the broker has purchased the shares on behal....
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....e AO in adding the amount of Rs. 66,90,330 as unexplained cash credit to the income of the assessee is not at all justified. In view of categorical mention of commission amount of Rs. 3,35,000 paid by the assessee to the broker in intimation issued by the said broker to the assessee itself categorically establishes that the purchase and sale of the shares on behalf of the assessee and realisation of the same has resulted into credit of Rs. 66,90,330 and commission of Rs. 3,35,000 was paid to the broker towards services for purchase and sale of shares. Therefore, under these facts and circumstances of the case the impugned order passed by the learned CIT(A) is a well reasoned one and accordingly he sought for upholding the same and dismissin....
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....lders coupled with the holding of the said shareholders together with the share certificate numbers and folio numbers of the shares held by each shareholder. This is cogent evidence, which goes to the root of the matter to find as to the genuineness of the purchase and sale of shares by the assessee, but this was not done by the AO though he is having abundant powers under s. 131 of the IT Act, The AO simply making assumptions and presumptions from the evidence produced by the assessee and taking ship shot extracts of the statement of the assessee, but not considering the statement as a whole. The AO has also not written to the stock exchange of Ahmedabad as to the trading of these shares by the said broker in the stock exchange. In the abs....