TaxTMI 
TaxTMI 
2017 (3) TMI 969
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....in ITA No.1499/Ahd/2016 wherein following grounds have been raised :- : 1. The part of impugned order is contrary to the evidence and material on record, contrary to the principles of law and binding judgments of the Court, contrary to the relevant provisions of the Act and deserves to be quashed and set aside. 2. The learned CIT(A) has grievously erred confirming the invocation of the provisions u/s 147 made by learned A.O. and who does not have any reason to believe that the income chargeable for the year has escaped the assessment. 3. Without prejudice to the above the learned CIT(A) should not have accepted the addition of Rs. 3,51,540/- being income of Long Term Capital Gain u/s.10(38) of Income-tax Act, 1961 The said addition is made by learned A.O. without going into the facts and learned CIT(A) should have decided the issue on merits of the facts. 4. The appellant craves leave to add to, alter, amend, modify and/or vary any or all of the grounds aforesaid at the time of hearing. 4. Briefly stated facts as culled out from the records are that assessee being an individual filed his return of income on 22.02.2008 declaring total income of Rs. 1,36,738/- and the said retur....
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....r not is not accessible. Accordingly, all the transactions made by the assessee are unverifiable and also not ascertained that the assessee said transactions whether reflected in his return of income or not. Hence, same transactions also should be required for detailed verification from various aspects for genuineness of the said transactions as per the information supplied by the Director of Income-tax ( I & CI), New Delhi in this case." In view of the above, you are hereby required to show cause as to why the amount of Rs. 3,51,540/- should not be added to your total income as unexplained income. In absence of satisfied reply by the given date, the amount of Rs. 3,51,540/- will be added to your total income." 5. In response to the above referred notice and the queries necessary details were filed by the assessee relating to the nature of transaction including purchase and sale of shares. It was also explained that payment has been received through banking channels and the shares were transferred to the respective demat account and were sold thereof. During the course of assessment proceedings assessee also questioned the statement of Shri Mukesh M. Choksi and strongly contend....
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....igible for claim of exempt u/s. 10(38) of the IT Act. Thus, as stated above, there is no reason to give an opportunity to the assessee to crossexamine Shri Mukesh R. Chokshi and the materials found from the third party i.e. books, etc. Therefore, I do not agree with the opinion of the assessee and reject the request of the assessee. After taking the above view ld. Assessing Officer denied assessee's claim of long term capital gain exemption u/s 10(38) of the Act of Rs. 3,51,540/-. 6. Aggrieved, assessee went in appeal before ld. Commissioner of Income Tax(A) but could not succeed. 7. Now the assessee is in appeal before the Tribunal challenging the reopening of assessment proceedings u/s 147 of the Act as well as denial of exemption u/s 10(38) of the Act for long term capital gain. At the outset ld. Authorised Representative submitted that the issues raised in these appeals are squarely covered in favour of assessee by the decision of the Co-ordinate Bench in the case of Shri Pratik Suryakant Shah & others in ITA No.810/Ahd/2015 for Asst. Year 2006-07 & ors. wherein appeal of the assessee has been allowed directing the Assessing Officer to treat the surplus as long term capital....
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....s the case of the Revenue that the sale consideration received by the assessee was returned back in cash. It is also not the case of the Revenue that the shares in question are still lying with the assessee, nor it is the case of the Revenue that the amounts received by the assessee on sale of the shares is more than what is declared by the assessee. 14. The entire assessment is based upon the statement of Shri Mukesh Choksi. It is an undisputed fact that neither a copy of the statement was supplied to the assessee nor any opportunity of cross-examination was given by the Assessing Officer/CIT(A). The Hon'ble Supreme Court in the case of Andaman Timber Industries in Civil Appeal No. 4228 of 2006 was seized with the following action of the Tribunal:- "6. The plea of no cross examination granted to the various dealers would not help the appellant case since the examination of the dealers would not bring out any material which would not be in the possession of the appellant themselves to explain as to why their ex factory prices remain static. Since we are not upholding and applying the ex factory prices, as we find them contravened and not normal price as envisaged under section....
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....eal No. 2216 of 2000, order dated 17.03.2005 was passed remitting the case back to the Tribunal with the directions to decide the appeal on merits giving its reasons for accepting or rejecting the submissions. In view the above, we are of the opinion that if the testimony of these two witnesses is discredited, there was no material with the Department on the basis of which it could justify its action, as the statement of the aforesaid two witnesses was the only basis of issuing the Show Cause We, thus, set aside the impugned order as passed by the Tribunal and allow this appeal." 16. On the strength of the aforementioned decision of the Hon'ble Supreme Court, the assessment order has to be quashed. 17. For the sake of the completeness of the adjudication, even on facts of the case, the orders of the authorities below cannot be accepted. There is no denying that consideration was paid when the shares were purchased. The shares were thereafter sent to the company for the transfer of name. The company transferred the shares in the name of the assessee. There is nothing on record which could suggest that the shares were never transferred in the name of the assessee. There is als....