TaxTMI 
TaxTMI 
2012 (1) TMI 305
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.... to the said sum as "Income from other sources" as against claim of assessee of Long Term Capital Gain on sale of shares of M/s. Jay Kay Dee Industries Ltd. 2. The relevant facts are that assessee is an individual and claimed capital gain of Rs. 10,12,449/- in assessment year 2003-04 and of Rs. 6,99,796/- in assessment year 2004-05 on account of sale of 10,000 shares and 7000 shares respectively of M/s. Jay Kay Dee Industries Ltd. The Assessing Officer stated that assessee claimed to have purchased 25000 shares of M/s. Jay Kay Dee Industries Ltd. @ 4.31 per share on 3.11.2001 through M/s. VRP Financial Services Pvt. Ltd. out of which assessee sold 10000 shares in assessment year 2003-04 i.e. after one year at an average realization of Rs....
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....Dhanuka wife of Shri Pradeep Dhanuka, Director of his broker VRP Financial Services (P) Ltd. He has further stated that Shri Pradeep Dhanuka, has close association or nexus with M/s. Jay Kay Dee Industries Ltd. AO has stated that he made enquiries from Standard Chartered Bank, Mumbai who was the depository participant (DP) of the assessee and it was found that during the relevant assessment year, assessee has issued only six D-mat instructions. AO observed that said company is an unknown company and notice sent to said company was returned unserved. 3. Considering above facts, AO stated that above transactions were not genuine transaction and accordingly considered the entire sale proceeds of Rs. 10,55,575/- on sale of 10000 shares in as....
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....22 of Paper Book and reflecting the credit of said shares in D-Mat statement of assessee. Assessee submitted that he sold 10000 shares during assessment year 2003-04 through his broker M/s. VRP Financial Services Pvt. Ltd. i.e. 4000 shares on 29.11.2002, 1,000 shares each on 6.12.2002, 17,12,2002, 18,12,2002 and 19,12,2002 and remaining 2000 shares on 30.12.2002. It was also contended that assessee sold in the same manner 7000 shares in assessment year 2004-05. The assessee furnished during the course of assessment proceedings copies of contract notes and bills issued by broker on account of sales of shares. It is relevant to state that copies of said bills and contract notes for sale of shares issued by broker are placed at pages 23 to 40 ....
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....same. Ld. CIT(A) has stated that assessee has produced clinching evidences in the shape of purchase and sales bills, contract notes, records of payments made and received through normal banking channels, the confirmation of broker, records of transactions of purchase of shares in his balance sheet, the record of debit and credit of shares in his D-Mat account maintained with D.P holder etc. which are not disproved or found incorrect or false by AO. Ld. CIT(A) has also stated that the entire lot of 25000 shares of M/s. Jay Kay Dee Industries Ltd. were purchased in the preceding assessment year, the balance sheet and return of income for the said assessment year filed is duly accepted and no fault therein found by the AO. He has further obser....
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....bmitted that sale price shown by assessee are on higher side and therefore AO considered that transactions are not genuine. On the other hand, Ld. AR made his submissions on the lines of submissions made before authorities below and also referred relevant documents placed on Paper Book, the references of which have already been mentioned herein above. He further submitted that all the rates are comparable and transactions are genuine. He further submitted that assessee sold the balance 8000 shares out of 25000 shares in assessment year 2009-10 @ Rs. 8/- only. He submitted that order of Ld. CIT(A) is in order. 8. We have carefully considered the orders of authorities below and the submissions of Ld. Representatives of the parties. We have....