TaxTMI 
TaxTMI 
2016 (7) TMI 371
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....ssessee has raised multiple Grounds of appeal, which I shall deal in seriatim. 3. The first issue relates to an addition of Rs. 8,80,332/- made by the income tax authorities on the ground that it was income from undisclosed sources. In this connection, brief facts are that the appellant is an individual, who was deriving income from business and other sources. For the year under consideration, he had filed the return of income declaring a total income at Rs. 2,75,400/-, which, inter-alia, included capital gain on sale of shares. The assessee had sold 3450 shares of Essar Oil Ltd. through stock broking firm M/s. Hem Securities Ltd. for a net consideration of Rs. 8,80,332/-. 950 shares were purchased by the assessee on 04/04/2007 and 2500 ....
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....nt and passed an order under section 143(3) r.w.s. 147 of the Act and held that there was no real purchase and sale of shares carried out by the assessee. As a consequence, the entire sale consideration of Rs. 8,80,332/- was added to the returned income as 'income from undisclosed sources'. Primarily, such position has been affirmed by the CIT(Appeals) also and accordingly, the assessee is in further appeal before the Tribunal. 4. The Ld. Representative for the assessee vehemently pointed out that the entire addition is based on mere conjectures and surmises. The Ld. Representative for the assessee referred to a detailed Paper Book filed, wherein the relevant documents, namely, contract note for purchases of shares, bank statement , D-ma....
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....nted out that the reference made by the Assessing Officer to the enquiries from National Stock Exchange is not relevant in as much as the aforesaid purchase has been made in off-market deals and, therefore, it would not be in the knowledge of the stock exchange authorities. It was pointed out that merely because the assessee has purchased the shares in off-market transactions, it cannot be a ground to disbelieve them so long as the transaction is duly supported by the contract notes and in the present case it is further evidenced by the factum of sale of shares. The Ld. Representative for the assessee further pointed out that the reliance placed by the Assessing Officer on the statement of Shri Mukesh Chokshi is not relevant in as much as n....
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....ee and the Revenue is with regard to the determination of purchases of such shares, which is claimed to have been made from one M/s. Alliance Intermediaries & Network Pvt. Ltd. The assessee claimed that 950 shares and 2500 shares of M/s Essar Oil were purchased by him on 04/04/2007 and 13/04/2007 respectively through M/s. Alliance Intermediaries & Network Pvt. Ltd. for a total consideration of Rs. 1,78,550/-. It is further claimed that such purchase was reflected in the balance sheet for the preceding year ending on 31/3/2008, copy of which has been placed in Paper Book at page-20. It is further canvassed that such balance sheet accompanied the return of income, which has been subject to an assessment under section 143(3) r.w.s. 147 of the ....
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....made by the Assessing Officer to demonstrate that qua the instant transaction of the assessee, any infirmity has been confessed by Shri Mukesh Chokshi. Be that as it may, assessee has been consistently canvassing before the lower authorities that the statement of Shri Mukesh Chokshi be confronted to him. I do not find anything on record to suggest that any specific statement Shri Mukesh Chokshi has been confronted to the assessee. 6.1 Considering the entirety of circumstances and the material on record, in my view, there is no justification for the Assessing Officer to hold that that the sale consideration received on the sale of shares of M/s. Essar Oil Ltd. of Rs. 8,80,332/- is unexplained or from undisclosed sources. Therefore, I set ....