2018 (12) TMI 754
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....A.No.5882/Del./2018 as under. ITA.No.5882/Del./2018 - Shri Amar Nath Goenka, New Delhi : 3. This appeal by Assessee has been directed against the Order of the Ld. CIT(A)-7, New Delhi, Dated 08.08.2018, for the A.Y. 2015-2016, challenging the addition of Rs. 14,61,585/- under section 68 of the I.T. Act, 1961, on account of long term capital gains. 4. Briefly, the facts of the case are that the assessee filed its original return of income declaring income of Rs. 25.35.010/-. The assessee is an individual and declared income from Salary, House Property and Income from other sources. The assessee is Employee-Director of M/s. Premier Polyfilm Ltd. The assessee filed necessary details which have been examined by the A.O. The A.O. found that the assessee claimed Rs. 23.44.613/- as long term capital gain (LTCG) on sale of listed shares. Part of the Long Term Capital Gain (LTCG) has been claimed to have been earned is through sale of shares of M/s.Esteem Bio Organic Food Processing Ltd., (Scrip Code - EBFL Security Id-534927) listed on Bombay Stock Exchange (BSE). The summary of the share transaction is as under : Sale consideration of 1200 shares Rs.14,61,585/- Less: Cost of acquisi....
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....s have been made through banking channels and sold through stock market platform. Reason of suspicion is insufficient. The allegation that price is rigged is baseless and without any evidence. No opportunity to crossexamine have been given of the statements which are used against the assessee. The A.O. however, did not accept the contention of the assessee and by applying the test of human probability held that long term capital gains claimed by assessee is not genuine and falls within the ambit of Section 68 of the I.T. Act. Therefore, Section 115BBE of the I.T. Act is applicable and the same is taxable @ 30%. The A.O. accordingly made the addition of Rs. 14,61,585/-. 5. The assessee challenged the addition before Ld. CIT(A). The written submissions of the assessee and grounds of appeals are reproduced in the appellate order in which the assessee briefly explained that cost of the acquisition of Rs. 60,000/- have not been reduced. The addition is perverse and invalid and based on irrelevant reason. The statement of Shri Sanjay Vohra was not confronted to the assessee and no right of cross-examination have been given to rebut his statement. Therefore, such statement cannot be read....
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.... Jatin Investment Pvt. Ltd., New Delhi in ITA.No.4325 & 4326/Del./2009. The Ld. CIT(A), however, did not accept the contention of assessee and dismissed the appeal of assessee. The Ld. CIT(A), more or less on the same reasoning as given by the A.O. noted that there is strong circumstantial evidence against the assessee and that transaction is an accommodation entry, therefore, following the rule of preponderance of probability decided the issue against the assessee. It is also observed that A.O. is not under obligation to allow cross-examination of any person. The appeal of assessee was accordingly dismissed by the Ld. CIT(A). 6. Before the Tribunal, the Learned Counsel for the Assessee reiterated the submissions made before the authorities below and submitted that that all documentary evidences were filed before A.O, of which were filed in the paper book. The documents are, copy of the application for allotment of shares along with copy of the cheque. Allotment of shares, copy of the bank pass book, copy of the Demat account of Oriental Bank of Commerce showing accrued 6000 shares of the aforesaid company, copy of the contract note of share broker for sale of the shares, copy of ....
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.... in the assessment order have not been confronted to the assessee. The assessee has not been named by any of these persons for indulging in taking accommodation entries. He has, therefore, submitted that such evidence cannot be read in evidence against the assessee and relied upon the decision of the Hon'ble Supreme Court in the case of Kishan Chand Chela Ram 125 ITR 713 (SC). He has submitted that for claiming exemption u/s 10(38) of the Act, the assessee shall have to prove twin conditions i.e. the income arise from the transfer of long term capital asset and being equity share in a company where the transfer of sale of such equity share is entered into on or after the date of which Chapter-VII of the Finance Act, 2004 comes into force and such transaction is chargeable to security transaction tax under that Chapter. In the case of the assessee, both twin conditions are satisfied. He has filed copy of the shares certificate with transfer form, copy of debit note issued by Shreeji Broking (P) Ltd., copy of cash receipt of Shreeji Broking (P) Ltd., copy of ledger account of Indus Portfolio (P) Ltd., Page | 18 ITA No.3035/Del/2018 copy of form for evidence for payment of securit....
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....aid documents and rejected all the claims made by the assessee by relying on the report of the Investigation Wing and thereby made the addition, which is not sustainable in the eyes of law. I further find that the AO has given detailed explanation in the order regarding the modus operandi of bogus LTCG scheme but failed to substantiate how the assessee fell in the purview of the same without bringing any material on record and proving that the assesssee was directly involved in the so called bogus transaction. I further note that the addition in dispute made by the AO and upheld by the Ld. CIT(A) u/s 68 as unexplained credit instead of long term capital gain as claimed by the assessee, however, the source identity and genuineness of the transaction having been established by documentary evidences and there is no case for making addition u/s 68 of the Act, hence, the same deserve to be deleted. I note that in most of the case laws of the Hon'ble High Courts referred by the Ld. DR the reason on the basis of addition was confirmed was that the assessee had not tendered cogent evidence with regard to share transaction, however, in the present the case assessee has submitted all the....
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....he Hon'ble Income Tax Appellate Tribunal has erred in law in upholding the order of the CIT(A) deleting the addition of Rs. 12,59,000/- made by the AO on the basis of seized document on the grounds that the AO has not pointed out as to how the figures of Rs. 12.59 lacs has been worked out ignoring the fact that the assessee himself in his reply to the AO had tried to explain the source of the receipts of Rs. 12,59,000/- instead of challenging the working out of the said figure by the A.O. ? 3. The first three questions of law raised in this appeal are covered against the appellant by an order and judgment of a Division Bench of this Court dated 16.02.2017 in ITA-18-2017 titled as The Pr. Commissioner of Income Tax (Central), Ludhiana vs. Sh. Hitesh Gandhi, Bhatti Colony, Chandigarh Road, Nawanshahar. 4. The issue in short is this : The assessee purchased shares of a company during the assessment year 2006-07 at Rs. 11/- and sold the same in the assessment year 2008-09 at Rs. 400/- per share. In the above case, namely, ITA 18- 2017 also the assessee had purchased and sold the shares in the same assessment years. The AO in both the cases added the appreciation to the assess....
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.... assessee in the books of the broker, copy of ledger account of Indus Portfolio (P) Ltd., copy of evidence for payment of securities transaction tax and copy of the bank statement of the assessee to show that the assessee had entered into genuine transaction of purchase of share which were later on sold through the broker on recognized stock exchange after payment of STT. The claim of the assessee for sale of shares has been supported by the documentary evidences which have not been rebutted by the authorities below. Whatever inquiry was conducted in the cases of other parties and statement recorded of several persons namely Sh. Anil Khemka, Sh. Sanjay Vohra and Sh. Bidyoot Sarkar as referred in the assessment order and the report of the Investigation Wing were not confronted to the assessee and above statements were also not subject to cross-examination on behalf of the assessee. Therefore, such evidences cannot be read in evidence against the assessee. The order of the SEBI was also not confronted to the assessee. AO did not mention any such fact in assessment order. More so in those reports and statements, the name of the assessee has not been referred to. Ld. Counsel for the as....
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....physical form, converted them in D-Mat form and thereupon sale of those shares was carried out through recognized stock exchange after paying securities transaction tax, said transactions were to be regarded as genuine in nature and, therefore, assessee's claim for exemption under section 10(38) was to be allowed." 8.3. ITAT, Delhi Bench in the case of ITO, Ward-4(2), New Delhi vs. Jatin Investment Pvt. Ltd., New Delhi in ITA.No.4325 & 4326/Del./2009 vide Order Dated 27.05.2015 in paras 12 to 14 held as under : "12. We have considered the submissions of both the parties and gone through the material available on the record. In the present case, it is noticed that the assessee purchased the shares in earlier years which were shown as investment in the books of accounts and reflected in the "Asset Side" of the "Balance Sheet", out of those investments (copy which is placed at page no. 23 and 24 of the assessee's paper book), the assessee sold certain investments and accounted for the profit / loss and offered the same for taxation. In the present case, the amount in question was neither a loan or the deposit , it was also not on account of share application money, the sai....
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.... the shares transferred in his name. Purchase was made through cheque which is supported by bank statement. The transactions of sale have been made through Demat account. The contract note along with other details were produced to show that purchase and sale of the shares have been made through banking channel through recognized Stock Exchange through Demat account on which Security Transaction Tax have also been paid. The A.O. did not make any enquiry on the documentary evidences filed by the assessee. No material have been brought on record against the assessee to disprove the claim of assessee. It is not the case of the Revenue that amount received on sale of shares is more than what is declared by the assessee. The assessee pleaded that the Interim Order of the SEBI have been diluted by passing final order in which no adverse view have been taken against the aforesaid company. Thus, the claim of assessee of purchase and sale of shares have been supported by documentary evidences. The statement of Shri Sanjay Vohra was recorded by the Investigation Wing, Kolkata, but, the same was not confronted to the assessee and his statement was also not subjected to cross-examination on beh....