TaxTMI 
TaxTMI 
2019 (8) TMI 450
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....4. The shares were purchased online through two brokers namely ISF Securities and SMC Global Securities stationed at New Delhi. 5. Shares of M/s. Esteem Bio Organic Food Processing Ltd. which were purchased on 11.02.2013 were dematerialized on the same date as per the de-mat statement exhibited at page 5 of the paper book. The purchase consideration paid to ISF Securities Limited was also paid on the same date i.e. on 11.02.2013 which is evident from the bank statement of HDFC bank which is at page 4 of the paper book. Shares of M/s. Rander Corporation Ltd. purchased on 20.11.2012 were kept in the common pool account with SMC Global Securities Limited which is evident from page 6 of the paper book. The purchase consideration was paid on 23.11.2012 which is evident from the bank statement of HDFC bank exhibited at page 3 of the paper book. 6. Shares of M/s. Esteem Bio Organic Food Processing Ltd. were sold on different dates namely 22.02.2014 1200 shares, 28.02.2014 1200 shares, 04.03.2014 2400 shares and on 06.03.2014 1200 shares. The sale transactions were done through the de-mat account via online trading. 7. The 3500 shares of M/s. Rander Corporation Limited were split in the....
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....term capital gains according to the Assessing Officer the input of the investigation report of investigation wing Calcutta strengthen the theory of sham transaction in the following manner :- (a) The share broker involved admitted that they had received cash from the beneficiaries including the assessee and the same was returned in the form of sale proceeds of shares after paying STT. (b) The admission of the entry providers revealed that share sale transaction were nothing but accommodation entries wherein cheques were issued in lieu of cash. (c ) The stock broker had resorted to money laundering activities by using "Penny Stock". The share prices of the penny stocks were artificially inflated by the stock brokers so that capital gain could be introduced in the books of accounts unaccounted money by converting black money into white in the books of accounts and claimed exempt u/s. 10 (38) of the Act. 13. Once again drawing full support from the report of the Investigation Wing Calcutta the Assessing Officer was of the firm belief that provisions of section 68 of the Act squarely apply. 14. In view of his strong belief the Assessing Officer issued summoned u/s.131 of the Act t....
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....busing the exemption provisions u/s 10(38) of the statute, to circumvent the law of the land, evade taxes and deprive the exchequer of its rightful due. The plethora of cases quoted by the AO all lend support to his decision, especially in such scam ridden cases, wherein it is essential to pierce the veil of legitimacy and innocence/ ignorance and look behind the charade woven to evade taxes. On the other hand, after due consideration of arguments put forth by the appellant, it is held that the Ld. AR has not been able to controvert/ successfully distinguish the judicial pronouncements quoted by the AO. Accordingly, the addition of Rs. 44,65,717/- u/s 68 of the IT Act r. w. s. 115 BBE made by the AO, is confirmed. "5.6 AO has made an addition of 7% of total long term capital gains earned (Rs. 40,51,874/-) amounting to Rs. 2,83,631/- as expenditure incurred out of books to obtain such entry. While the appellant claims it to be a genuine transaction and the addition being presumptive, it is a well known fact, that there are no free lunches in the business world. As has been brought out in various reports, there were multiple operators/ parties. Statement recorded of some of the ope....
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.... recorded by any other authority of the department. Facts narrated above clearly show that the Assessing Officer has not made any enquiry and the entire assessment order and the order of the first Appellate Authority are devoid of any such enquiry. 24. The report from the Directorate Income Tax Investigation Wing, Kolkata is dated 27.04.2015 whereas the impugned sales transactions took place in the month of March, 2014. The exparte ad interim order of SEBI is dated 29.06.2015 wherein at page 34 under para 50 (a) M/s. Esteem Bio Organic Food Processing Ltd was restrained from accessing the securities market and buying selling and dealing in securities either directly or indirectly in any manner till further directions. A list of 239 persons is also mentioned in SEBI order which are at pages 34 to 42 of the order the names of the appellants do not find place in the said list. At pages 58 and 59 the names of pre IPO transferee in the scrip of M/s. Esteem Bio Organic Food Processing Ltd is given and in the said list also the names of the appellants do not find any place. At page 63 of the SEBI order-trading by trading in M/s. Esteem Bio Organic Food Processing Ltd - a further list of....
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.... to be drawn from the reading of the investigation report and the statement of Mr. Mahesh Garg. To elevate the inference which can be drawn on the basis of reading of such material into judicial conclusions would be improper, more so when the assessee produced material. The least that the assessing officer ought to have done was to enquire into the matter by, if necessary, invoking his powers under Section 131 summoning the share applicants or directors. No effort was made in that regard. In the absence of any such finding that the material disclosed was untrustworthy or lacked credibility the assessing officer merely concluded on the basis of enquiry report, which collected certain facts and the statements of Mr. Mahesh Garg that the income sought to be added fell within the description of Section 68." 28. The DR heavily relied upon the judgment of Hon'ble High Court of Delhi in the case of Udit Kalra Vs. ITO in ITA No.220/2019. We have carefully perused the order of the Hon'ble High Court and on going through the said judgment we find that no question of law was formulated by the Hon'ble High Court of Delhi in the said case and there is only dismissal of appeal in limine as the ....