TaxTMI 
TaxTMI 
2015 (11) TMI 1716
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....ate of purchase 2. On the facts and in the circumstances of the case and in law the learned CIT(A) has failed to appreciate that the assessee made shares transaction from M/s Badri Prasad and Sons stock broker who has been penalized by the SEBI for indulging in penny stock transaction during the year 2005 which is relevant to the current year under consideration 3. On the facts and in the circumstances of the case and in law the learned CIT(A) erred in holding that the transaction was genuine without appreciating the fact that;- a. The Broker M/s Badri Prasad & Sons through whom the assessee has claimed to have purchased the shares, has clearly denied the execution of any share transaction of M/s Emerald Commercial Ltd. on 06.05.2004, the date on which the assessee has claimed to have purchased 10000 shares. b. The purchase transactions are out of cash in hand which was on account of gift received by the assessee from his relatives. The purchases of shares are off bolt and such purchases are not reflected in the stock exchange." 2. Assessee purchased 10,000 shares of M/s Emrald Commercial Ltd. for a total consideration of Rs. 2,17,100/- vide Bill No.CK012....
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....e first return of the appellant because the appellant had become major only on 26.05.2005 and there was no previous records of return filed or Balance Sheet available according to which the appellant was holding 10,000 shares of Emrald Commercial Ltd as on 31.03.2005. The cash on hand shown by the appellant as on 01.05.2004 at Rs. 3,45,602/- did not had any antecedent as to how the appellant is in possession of such a huge cash because the appellant was minor prior to 26.05.2005 and the cash has been shown in the hands of the appellant prior to his becoming major. Thus the source of such huge cash remains unexplained. e) The value of the shares which was purchased at Rs. 21.7 per share suddenly jumped in about a year to Rs. 465 to Rs. 489 on the Stock Exchange and the company did not had such fundamental for this share to justify the price. f) The appellant is not investing in shares and know nothing about the shares and therefore it is difficult to believe that he ought to have purchased such a large quantity of shares unless there are different motives for such purchase. g) When the above details of transactions of purchase on Calcutta Stock Exchange wa....
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....rmation gathered by the appellant, the Broker Badri Prasad & Sons was examined by the AO and everything was explained by the Broker alongwith evidence. iii) The appellant had further filed during the assessment proceedings, the letter dt.17.07.200/1 issued by the Company M/s Emrald Commercial Ltd transferring 10,000 shares in the name of the appellant alongwith physical share certificates for shares transferred in his name which aspect independently confirmed that the appellant was in possession of share certificates duly transferred in his name proving him to be legal owner of shares. iv) The appellant further filed details of Demat Account with HSBC and the Broker's Note for the sale of shares which it made through the Broker Murarilal Goenka and Shivam Stock Broking Pvt.Ltd both Brokers' of Calcutta Stock Exchange through online Trading System on Calcutta Stock Exchange. v) The AR further stated that it has filed during the assessment proceedings, copy of Bank Statement in which the sale proceeds of the shares were deposited and there was no equivalent or any transactions of withdrawal of cash against such deposit of sale proceeds in the banks.....
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....ns vide Bill No. CK012/20053226 dated 06.05.2004 which shares were purchased in physical form which were submitted to the Company for transferring in its name, which the company transferred by its letter dated 17.07.2004, which were later on submitted on 12.08.2005 for demat in the Demat Account of the assessee with HSBC Bank and later on the shares were sold through the online trading system of the Calcutta Stock Exchange through the Broker Murarilal Goenka and M/s. Shivam Stock Broking Pvt. Ltd. and each and every details of sale of shares were duly furnished in assessment proceedings. Hence, in the view of the assessee, the transactions giving rise to LTCG on sale of shares of Rs. 45,43,362/- is fully supported by all the necessary evidences mentioned above and therefore Assessing Officer was not justified to tax the entire sale proceeds on sale of shares as unexplained cash credit under section 68 of the Act. 6. The CIT(A), after going through the submissions on behalf of assessee accepted the contentions of assessee and granted relief as prayed. Same has been opposed before us on behalf of Revenue. The learned D.R., inter alia, submitted that CIT(A) erred in holding that lo....
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....ogus or fabricated documents. 8. Assessee duly received physical delivery of 10,000 shares by way of 20 share certificates of 500 shares each of the company Emrald Commercial Ltd. and such shares were duly transferred in the name of the assessee by letter of the company dated 17.07.2004 which aspect is also not found incorrect or manipulated. The physical shares received by assessee duly transferred in his name were thereafter demated by delivering them to HSBC, the demat Account holder and after demating the shares have continued to remain in the Demat A/c of assessee which aspect is also independently verified from the Demat Statement of assessee with HSBC. 9. The 4000 demated shares were thereafter sold through the Broker Shivam Stock Broking Pvt. Ltd. of the Calcutta Stock Exchange through online trading system and the balance shares numbering 6000 were duly sold through the Broker Murarilal Goenka of Calcutta Stock Exchange through online trading system. The Sales Bills/Contract filed by assessee for sale of the shares has not been disbelieved or disputed by Assessing Officer in any manner. The sale proceeds received on sale of shares have been duly received by "A/c paye....