TaxTMI 
TaxTMI 
2018 (9) TMI 1308
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....sees are related parties and the issues are common and therefore, the appeals were heard together and are disposed of by this common and consolidated order. For the sake of convenience, the grounds of appeal raised by the assessee Shri Pramod Kumar Bung are reproduced hereunder: "1. That the learned CIT (A) erred in law and on fact in confirming the assessment order and dismissing the appeal filed against the assessment order. 2. That the learned CIT (A) without appreciating the facts and without proper application of law erred in confirming the addition of Rs. 34,99,520 and upholding the denial of exemption claimed u/s 10(38) of the I.T. Act, 1961. 3. That the learned CIT (A) erred in dismissing the ground that n....
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....nce against the appellant. 8. That the learned CIT (A) erred in upholding order of the AO where the claim of the Appellant has been rejected on the basis of certain finding by the Investigating Officers in respect of other persons and not in respect of the appellant, in particular even though there is absolutely no reference to the appellant in the report relating to such investigation. 9. That the learned CIT (A) erred in upholding order of the AO which is based on suspicion and doubt. His suspicion however strong cannot take the place of proof as was held by the Hon'ble Supreme Court in the case of Umacharan Shaw and Brothers vs. CIT West Bengal (37 ITR 271 S.C) and Dhakeshwari Cotton Mills Ltd vs. CIT (26 ITR 775 S.....
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....ed it as exempt from Income Tax. Meanwhile, the Directorate of Investigations, Kolkata carried out a country wide investigation to unearth the organized racket of generating bogus entries of LTCG which is exempt from the Income Tax. As per the said information available, the assessees are also the beneficiaries of the above scheme. The AO therefore, went through the record and found that during the financial year 2010-11 relevant to the A.Y 2011-12, the assessees before us, have sold the shares of M/s. NCL Research & Financial Services Ltd (which was identified as a Penny Stock Company) and claimed the LTCG gain derived from the said transactions as exempt u/s 10(38) of the Act. The AO, therefore, reopened the assessment u/s 147 by issuance....
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....sessment in a letter dated 13.10.2016 and it is also not in dispute that the reasons for reopening were not supplied to the assessees. The Hon'ble Supreme Court in the case of GKN Driveshaft India Ltd vs. ITO (259 ITR 19), has clearly held that the AO has to supply the reasons for reopening of the assessment to the assessee, if it is asked for, and if the assessee filed its objections to the said reasons for the reopening, the AO has to dispose of the said objections before proceeding to complete the assessment. In the case before us, clearly such a procedure had not been followed by the AO and even before the CIT (A), the assessees have not been given the copy of the reasons for reopening. During the course of hearing before us, the le....