TaxTMI 
TaxTMI 
2021 (1) TMI 225
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....e time directing the AO to disallow exemption of Rs. 58,56,466/- u/s 10(38) LTCG on Sale of shares of NYSSACORP thus directions are contradictory. 3. On facts and circumstances of the case and in law Ld. Pr.CIT erred in giving finding that appellant has voluntarily disclosed income of Rs. 40,67,350/- on account of LTCG on same issue in A.Y. 2013-14, without appreciating the fact that voluntary disclosure of LTCG was sale of shares of UNISYS SOFTWARE in A.Y. 2013-14 and not shares of 'NYSSACORP' which were sold during the year, thus scrip were different. 4. On facts and circumstances of the case and in law Ld. Pr. CIT erred in holding that order of AO u/s 143(3) is erroneous in so far as it is prejudicial to the interest of revenue without appreciating the fact that issue of taxability of LTCG on sale of shares of NYSSACORP was fully examined by AO at the time of assessment proceedings and only after examining such issue AO satisfied himself that same is exempt and accordingly passed order u/s 143(3). 5. On facts and circumstances of the case and in law Ld. Pr. CIT erred in holding that order of AO u/s 143(3) is erroneous in so far as it is prejudicial to the interest ....
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....shares as exempt under Sec.10(38) of the Act, the Pr. CIT was of the view that the A.O while framing the assessment had accepted the same without making any verification as regards the genuineness/correctness of the purchase/sale transactions under consideration. Holding a conviction that the failure on the part of the A.O in allowing the assessee's claim of exemption under Sec.10(38) without making any verification as regards the genuineness and correctness of the aforesaid share transactions had rendered the assessment order passed by him as erroneous insofar it was prejudicial to the interest of the revenue the Pr. CIT issued a 'Show cause' notice (for short "SCN") dated 12.09.2017 therein calling upon the assessee to explain as to why the assessment order passed by the A.O may not be revised. In reply, it was submitted by the assessee that he had in the course of the assessment proceedings furnished the requisite details and documents as were called for by the A.O. As regards the purchase/sale of shares carried out during the year under consideration it was the claim of the assessee that the documents substantiating the genuineness and veracity of the aforesaid transactions viz....
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.... the present appeal involved a delay of 142 days. Explaining the reasons leading to the delay in filing of the present appeal it was submitted by the ld. A.R that the same had occasioned, for the reason, that the impugned order passed by the Pr.CIT u/s 263, dated 27.02.2018 was though served upon the assessee's employee viz. Mr. Jitesh Chauhan, however, the latter forgot to deliver the same to the assessee. It was stated by the ld. A.R that the impugned order was handed over by the employee i.e Mr. Jitesh Chauhan to the assessee only on 28.09.2018. It was submitted by the ld. A.R that after receiving the impugned order the assessee immediately delivered the same to his tax consultant and involving no further loss of time filed the present appeal on 01.10.2018. In the backdrop of the aforesaid facts it was submitted by the ld. A.R that as the delay involved in filing of the present appeal had occurred on account of a bonafide reason, therefore, the same may be condoned. In order to dispel any doubts as regards the aforesaid factual position so projected before us the ld. A.R took us through the 'affidavits' of the assessee i.e Shri Bansilal C.Jain and that of the latters employee i.....
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....any details as regards the aforesaid share transactions the ld. A.R took us through a notice issued under Sec. 142(1), dated 11.04.2016. It was stated by the ld. A.R that pursuant to a query raised by the A.O as regards the addition made to the assessee's 'capital account' for the year under consideration documents in support of the aforesaid share transactions were placed on his record. As regards the view taken by the Pr. CIT that a similar issue was involved in the case of the assessee for the immediately preceding year i.e A.Y 2013-14, it was submitted by the ld. A.R that the said observation of the revisional authority was absolutely incorrect and in fact out of context. It was submitted by the ld. A.R that in A.Y 2013-14 the assessee had sold shares of Unisys Software. It was submitted by the ld. A.R that as Unisys Software was subjected to certain investigations by SEBI, therefore, the assessee only in order to buy peace of mind had offered LTCG on sale of shares of the said company under the IDS scheme. It was averred by the ld. A.R that the Pr.CIT was in error in drawing adverse inferences on the basis of the aforesaid transaction which had no nexus with the sale of shares....
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....ty did emerge from the 'setting aside' of the assessment framed by the A.O on the basis of one of the aforesaid issues. As regards the observations recorded by the Pr.CIT in respect of the voluntary disclosure of income i.e LTCG by the assessee in A.Y. 2013-14, it was submitted by the ld. D.R that the Pr.CIT by referring to the past conduct of the assessee had only tried to supplement his conviction that considering the same the A.O ought to have been more vigilant while verifying the authenticity of the assessee's claim for exemption raised under Sec. 10(38) during the year under consideration. Adverting to the notice issued by the A.O under Sec. 142(1), dated 11.04.2016, it was submitted by the ld. D.R that no query as regards the aforesaid share transactions was ever raised by the A.O. It was stated by the ld. D.R that though the assessee is stated to have filed certain documents as regards the aforesaid share transactions, however, the A.O had at no stage during the course of the assessment proceedings carried out any verification as regards the genuineness and correctness of such transactions. On the basis of the aforesaid contentions it was averred by the ld. D.R that no infi....
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....t at all impressed by the claim of the ld. A.R that though the Pr. CIT vide his SCN, dated 12.09.2017 had sought to revise the assessment order in context of the LTCG of Rs. 58,56,466/- pertaining to purchase/sale of shares of M/s Ravinay Trading Corpn. Ltd. (Nyssacorp) that was claimed by the assessee as exempt under Sec. 10(38), but then, considering the fact that the assessee had voluntarily disclosed LTCG of Rs. 40,67,350/- in A.Y. 2013-14 he had directed the A.O to conduct proper inquiries, investigations and examination. As observed by us hereinabove, the reference by the Pr. CIT to the voluntary disclosure of LTCG of Rs. 40,67,350/- on sale of shares and payment of taxes on the same in A.Y. 2013-14 was only in order to support his conviction that considering the past conduct of the assessee the A.O ought to have been more careful and should have thoroughly verified the genuineness of the share transactions and the resultant claim for exemption of LTCG raised by the assessee u/s 10(38) during the year in question. 12. On a perusal of the orders of the lower authorities, we find, that as the A.O had failed to verify the genuineness and correctness of the aforesaid share trans....