TaxTMI 
TaxTMI 
TaxTMI 
2021 (3) TMI 50
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.... was correct in concluding that the assessee was a beneficiary of the accommodation loans. The appellant prays that the order of the CIT(A) on the above grounds be set aside and that of the Assessing Officer be restored. The appellant craves leave to amend or alter any ground and/or add new grounds which may be necessary." 4. The brief facts of the case are that the assessee filed its return of income on 12.09.2011 declaring total income to the tune of Rs. Nil for the A.Y. 2011-12. The return was processed u/s 143(1) of the I. T. Act, 1961. Thereafter, the case of the assessee was reopened u/s 148 of the Act. The reasons for reopening of the assessment was given to the assessee. The assessee received the accommodation entry in form of bogus unsecured loans from Bhanwarlal Jain Group run entities during the previous year in consideration. The assessee filed the objection vide letter dated 17.05.2018. The AO rejected the objections by virtue of order dated 01.06.2018. The AO completed the assessment by making an addition of Rs. 24.35 crores u/s 68 of the Act treating the loans received by the appellant as bogus thereby assessing the total income of the appellant at Rs. 9,24,88,9....
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.... upheld the order of CIT(A), which had deleted the addition made by the AO u/s 68 of the Act. 13.4 For the A.Y. 2013-14, an addition of Rs. 34.35 crores was made by the AO u/s. 68 of the Act for loans received by the Appellant from various parties belonging to the Bhanwarlal Jain group. The Appellant preferred an Appeal before CIT(A), who had vide order No. CIT(A)-47/E10046/2012-13 deleted the addition made u/s.68 of the Act and other connected additions. The Department preferred an Appeal before the Hon'ble ITAT and the Hon'ble ITAT, Mumbai, 'F' Bench, vide its order dated 16.01.2019 in ITA No.5637/Mum/2017 dismissed the Appeal of the Department and upheld the order of CIT(A) deleting the addition made by the AO. In this judgment, the Hon'ble ITAT had discussed the order of the Hon'ble ITAT in the case of the Appellant for the A.Y. 2012-13 and had also referred to the order passed by the Ld. CIT(A). The relevant portion of the said judgment of Hon'ble ITAT Mumbai being comprehensive and detailed the same is reproduced, as under: "we have heard both the parties and we have also perused the Ss well as the orders passed by revenue placed on record as by the Coordinate Bench o....
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....t the directors of various companies are only employees of Shri Bhanwarial Jain. This group ensured that the transactions are arranged in a perfect manner in order to avoid even slightest of doubt. He submitted that the search team has, however, unearthed the bogus nature of all transactions, which has also been confirmed by Shri Bhanwarial jain and other persons. 6. The Ld D.R submitted that the appellate authorities are also duty bound to conduct necessary enquiries, if there ts any deficiency in the enquiry conducted by the AO, as held by Hon'ble Delhi High Court in the case of jansampark Advertising @ Marketing (P) Lid (ITA 525/2014 dated 11-03-2015). He further submitted that the Hon'ble Delht High Court has highlighted in the case of Pr. CIT Vs. Bikram Singh (ITA 55/2017 dated 25-08.2017) there is constant use of deception of loan entries to bring unaccounted money into banking channels and the device of loan entries continues to plague the legitimate economy of our Country. The Hon'ble Delhi High Court found in the above said case that the loan transactions did not inspire confidence as being genuine and are shrouded in mystery and accordingly confirmed the add....
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....t the order passed by Ld CIT(A) should be reversed. Alternatively, he suggested that the matter may be restored to the file of the AO for examining it afresh by conducting further enquiries. 10. The Ld A.R submitted that the assessing officer has made the addition u s 68 of the Act. He submitted that the assessee is required to discharge the initial onus placed upon it u/s 68 of the Act. He submitted that the assessee has furnished all the documents in order to prove the identity and creditworthiness of the creditors. All the transactions have been routed through the banking channels ana hence genuineness of the creditors is also proved. The ld A.R submitted 'the revenue did not find any incriminating material during the real of survey operations conducted in the hands of the assessee that the assessee, vide its letter dated 03-03-2015, has all the documents relating to the loan creditors, viz., copy of their ITR, their financial statements and bank statements, loan confirmation letters obtained from them and thus the assessee has discharged the initial onus placed upon it u/s 68 of the Act. He submitted that the onus to disprove the claim of the assessee was accordingly shifted ....
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....ded from him and the, employees. The assessing officer, however, did not confront those materials and sworn statements with the assessee. He submitted that the assessee, vide its letter dated 13-03-2015 (copy placed at page 89 of the paper book), has requested the AO to furnish copies of information, statements, reports or any document on which the AO has placed reliance. Further the assessee has also requested the AO to allow reasonable opportunity to give submissions and explanations on those materials. The assessee has also specifically asked for an opportunity to confront and cross examine the parties who gave the Statements. The assessee again made similar request in its letter dated 19-03-2015. The Ld A.R submitted that the AO, however, did not furnish the copies of documents and also did not allow the opportunity to cross examine the parties who gave adverse statements. 13. The La A.R submitted that the assessing officer is not entitled to rely upon the documents collected behind the back of the assessee. In this regard, the Ld A.R placed his reliance on the decision rendered by Hon'ble Supreme Court in the case of Kishinchand Chellaram vs. CIT (1980 125 ITR 713). He....
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....f his order. The Ld A.R further submitted the statements given by Shri Bhanwarlal Jain has been claimed to have been retracted. He submitted that the co-ordinate bench of the Tribunal has rendered its decision in the case of M/s Vama International (ITA No.7315, 7316 & 7317/Mum/2016 dated 15-02-2018), wherein the issue was related to the disallowance of purchases made from M/s Bhanwarlal Jain Group. In the said decision, the Tribunal has recorded that the statements have been retracted by them subsequently. The co-ordinate bench has further held that the purchases could not be treated as bogus simply relying on the statements given in the case of Bhanwarlal Group. Accordingly the La | A.R submitted that the AO could not have placed reliance on the statements given by Shri Bhanwarlal Jain and others. 16. We have heard rival contentions and perused the record. We also notice that the Ld CIT(A) has deleted the additions by making detailed observations. For the sake of convenience, we extract below the operative portion of the order passed by Ld CIT(A): he "ty have carefully considered the issues brought out by the AO in the impugned assessment order and also the submissions made by....
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....chased against payment of unaccounted cash? c. Has the Assessing Officer brought any material on record to show that commission was paid to Shri Bhanwarlal Jain? 6.3.2 First of all, it would be worthwhile to examine the impugned assessment order with regard to material that shows that the hawala racket was run through benami entities of Shri Bhanwarlai Jain, In this regard it may be mentioned that: a. In sub-paragraph 4.18 of the. assessment order, the Assessing Officer claims that in their respective statements, recorded u/s 132(4) all Directors/ Proprietors/Partners of the alleged benami entities run by Shri Bhanwarlal Jain have admitted to being dummies, business in whose names was actually being run by Shri Bhanwarlal Jain. b. In the very next sub-paragraph 4.19, the Assessing Officer goes on to name 13 individuals (LunkaranParasmal Kothari, Anil Khicha, Rajesh Chopra, RiteshSiroya, Rohit Birawat, Basant D Jain, Shreyansh L Jain, Bharat Omprakash Jain, Mahavir Mangalchand Jain, RamnivasChoyal, Gautam Kumot, Rajesh Chopra and Atul Ladda). - According to the Assessing Officer, these. persons were dummy Directors/Partners/Proprietors, used by Shri Bhanwarlal Jain in runnin....
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.... bring any concrete material on record. 6.3.5 Survey Action u/s 133A of the Act at the appellant premises: Material, brought on record by the appellant before the Assessing Officer in the course of assessment proceedings clearly shows that about a year after search action of 2013 in the case of Shri Bhanwarlal Jain, the appellant was surveyed by the Investigation Wing on 16-10-2014. The survey party found that the impugned loans of * 24.75 crore from the aforesaid 17 entities were incorporated in the Pare 6 of account of the appellant. Statement on oath of Shri Hemal Jhaveri, Key Person, was recorded on the 16th, the 17th and the 18th of October, 2014. Shri Hemal Jhaveri maintained that these loans were genuine and were not part of any hawala. He claimed that no commission whatsoever had been paid to Shri Bhanwarlal Jain; that interest had been paid to the creditors; and, that TDS had regularly been deducted and paid into the Government Treasury. The officers conducting the survey showed Shri Jhaveri an alleged confessional statement of 09-10-2013 made by Shri Bhanwartal Jain, admitting hawala operations through benami entities. Shri Hemal Jhaveri did not dispute the said state....
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....imply explains that balance sheet which explains source of loan doesn't prove credit worthiness of concerns. In view of this please explain why the unsecured loan taken by M/s Jainam Investments from the group concerns of Shri Bhanwarlal Jain should not be treated as just accommodation entry? Ans. In view of my reply to earlier question I can't comment on this. Q.31 Please go through the Q. No 29 to 34 of Shri. Bhanwar Lal Jain. In this statement Shri. Bhanwar Lal Jain has admitted that concerns operated by him has certain transactions which are not recorded in regular books of accounts. These transactions had not been routed through banks but through angdiya account in cash. Shri. Bhanwar Lal Jain had also admitted that he used to record these transactions in separate parallel books in electric form as well as and in physical form. During the course of search u/s 132 on 03.10.2013 these parallel books of accounts were seized and Shri Bhanwar Lal Jain has also explained in detail the codes under which these accounts were maintained. In post search investigation, these accounts were deciphered wherein your name against transactions through angadiya channel were also reco....
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....s. There was nothing to show that there was any actual exchange of cash between the appellant and the alleged hawala giver, before the impugned loans were incorporated in the books of account of the appellant. Also, there was no material to show that any commission for arranging the hawala had been paid by the appellant to the said Shri Bhanwarlal Jain. The situation retrained unaltered in the course of the assessment proceedings and the Assessing Officer did not in any manner improve upon what had been done by the investigation Wing. 6.3.7 Non-observance of Principle of Natural Justice: Not making available material used against the appellant & denying opportunity to cross-examine witnesses: In the grounds of appeal, first six grounds raised by the appellant are dealing with the issue of AO not observing the principles of natural justice and the material relied upon is not made available to the appellant and denying the opportunity of cross examination of witnesses. The record shows that through various letters filed before the Assessing Officer in the course of assessment proceedings, the appellant had on more than one occasion specifically asked the Assessing Officer to make....
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....he decisions cited by Mr. Tralshawalla and finding that on a very fundamental aspect, the revenue was not justified in making addition at the time of reassessment without having first given the assessee an opportunity to cross examine the deponent on the statements relied upon by the A CIT. Quite apart from denial of an opportunity of cross examination, the revenue did not even provide the material on the basis of which the department sought to conduct that the loan was a bogus transaction. 17. In our view in the light of the fact that the monies were advanced apparently by the account payee cheque and was repaid vide account payee cheque the least that the revenue should have done was to grant an opportunity to the assessee to meet the case against him by providing the material sought to be used against assessee in arriving before passing the order of reassessment. This not having been done, the denial of such opportunity goes to root of the matter and strikes at the very foundation of the reassessment and therefore renders the orders passed by the CTT(A) and the Tribunal vulnerable. In our view the assessee was bound to be provided with the material used against apart from bein....
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.... statutory authority arrives at a just decision and it is calculated to act healthy check on the abuse or misuse of power." "The maxim pattern has many facets. Two of there are (a) notice of met and (b) opportunity to explain. "In facts and 6% genuineness of a particular case when non-alliance with the implied requirements of the audialterm partem, rule of natural justice at decisional stage, the impugned order can be struck down as invalid on that score atone" 6.3.13 It has also been held by the Apex Court in the case of Delhi Transport Corporation vs DTC Mazdoor Congress, in 1991 AIR 101, that the audialterm partem rule which in essence enforces the equality clause of Article 14 of the Constitution and is applicable not only to quasi-judicial orders but to administrative orders -affecting prejudicially the party in question. 6.3.14 A similar matter came up before the Hon'ble Supreme Court in the case of M/s Gira Enterprises & Another (Civil Appeal Nos. 433-434 of 2006); Dated: 21-08-2014. In that case, it was alleged that prices declared for import purposes had been suppressed. The case was based on evidence contained in a computer printout, reportedly prepared on the bas....
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.... 6.3.16 The case law relied by the assessee of Rushabh Enterprises vs. Asst CIT WRIT Petition No. 167 of 2015 is not applicable to the present case as in that case the assessee filed petition against the reopening u/s 148 of the Act and in present the assessment is made u/s 143(3) of the Act. 6.3.17 Absence of material to show that the Loan Entries are Unexplained: From the forgoing, it is obvious that there is no scope for arriving at a conclusion that the appellant had taken hawala entries to incorporate the impugned loans in its books of account. Hence, the only issue that remains to be seen is whether on the basis of facts brought on record the impugned loans could be treated as unexplained within the fore corners of section 68 of the Act. At the outset, it will necessary to look at some legal precedents with regard to the intent and application of section 68. It needs no elaboration that through a catena of decisions the Courts have laid down the following three fundamental tests which have to be established to discharge the burden under section 68 of the Act: Identity of the creditor - Creditworthiness of the creditor, and Genuineness of the transaction, 6.3.18 The ....
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....e of credits need not be proved. 6.3.23 In the case of CIT vs. Smt. Sushiladevi Khadaria [2009] 319 ITR (Bom), Hon. Bombay HC held that when loans were taken 'by account payee cheques and the record indicated that there was no cash payment in the account of the borrower prior to the issuance of such cheques, the loans and interest paid on such loans were not includible in the total income of the assessee u/s.68 of the Act. 6.3.24 In the case of IT O v. Anant Shelters (P) Ltd, [2012] 051 SOT 0234, the Hon'ble TTAT (Mumbai) held that in matters regarding cash credit the onus of proof was not a static one. As per the provisions of the section 68, the initial burden of proof lies on assessee. Amount appearing in books of accounts of the assessee was considered a proof against him. He can prove the identity of the creditors by either furnishing their PANs or assessment orders. Similarly, genuineness of transaction could be proved by showing that money was received by an account payee cheque or by draft. Credit worthiness of the lender could be established by attending circumstances. Once assessee produces evidences about identity, genuineness and credit worthiness of the lender,....
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....elonged to non but the assessee. The addition of Rs. 17,27,250 under section 68 was not justified. 6.3.27 In the case of CIT v. Kinetic Capital Finance Ltd. [2013] 354 ITR 296 (Del), it was held by the Delhi High Court that the assessee had discharged that initial onus. The assessee was not required thereafter to prove the genuineness of the transactions as between its creditors and the creditors' source of income, i.e. the sub creditors. 6.3.28 In a recent decision given by the Delhi High Court in case of CIT v. Samtel Color Ltd. 64 DTR 46, it was held that by bringing on record every possible information regarding the depositors included in the application form which included particulars of applicant/depositor, telephone No., particulars of demand draft/cheque through which the deposit was made, tax status of applicant and other deposits with the assessee, if any, assessee had discharged the initial onus laid on it under section 68 and addition could not be made merely for the reason that no confirmation letters were filed in respect of some of the depositors. 6.3.29 The question whether an assessee is required to prove the source of source also has been answered by the....
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....ASTHA IMPEX 02-06-2011 RTGS 50,00,000 AASTHA IMPEX 27-06-2011 RTGS 50,00,000 AASTHA IMPEX 20-03-2012 RTGS 1,00,00,000 AASTHA IMPEX 20-03-2012. RTGS 1,00,00,000 AASTHA IMPEX 05-03-2012 RTGS 50,00,000 AASTHA IMPEX 24-08-2012 RTGS - 40,00,000 AASTHA IMPEX 12-10-2012 RTGS 10,00,000 AASTHA IMPEX --:16-10-2012_ RTGS. 1,00,00,000 AASTHA IMPEX 16-10-2012 RTGS 50,00,000 AASTHA IMPEX 24-11-2012 RTGS -50,00,000 BALAJI IMPEX 04-05-2011 RTGS. 1,00,00,000 BALAJIIMPEX 13-06-2012 RTGS --_1,00,00,000 IMPEX GEMS 23-06-2011 RTGS' _ 50,00,000 IMPEX GEMS 17-03-2012 RIGS 50,00,000 MAYUR EXPORTS --16-05-2011 | RTGS 50,00,060 MAYUR EXPORTS 25-06-2011 RTGS 1,00,00,000 22-11-2012 RTGS 1,50,00,000 22-07-2011 RTGS 50,00,000 MALHAR EXPORTS 06-02-2012 RTGS 50,00,000 MARVIN ENTERPRISES 20-03-2012 RTGS 1,00,00, 000 MARVIN ENTERPRISES 09-10-2012 RTGS 1,00,00,000 MEHUL GEMS PVT. LTD. 29-02-2012 RTGS 1,00,00,000 MEHUL GEMS PVT. LTD. 29-02-2012 RTGS 1,00,00,000. MEHUL GEMS. PVT. LTD. 1307-2012 RTGS 1,50,00,000 MEHUL GEMS PVI. LTD. 08-11-2012 RTGS 50,00,000 MINAL GEMS 23-06-2011 RTGS 50,00,000 MINAL GEMS 1703-2012 RTGS 50,00,000 MANAS GEMS PVT. LTD. 29-02-2012 RTGS 1,00,00,000 MANAS GEMS PVT. LTD. 08-11-2012 RTGS 1,....
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....ns were unexplained. Therefore, the impugned addition of Rs. 24,75,00,000/-, made in the Assessment Order, fails on several counts - (1) reliance on evidence that is totally inadequate; (2) failure to make available incriminating material (reports, statements etc.) forming basis for action by the Assessing Officer; (3) failure to give due opportunity to the appellant to cross-examine witnesses, whose statement might have been relied upon; and, (4) failure to recognize the satisfactory nature of the explanation/evidence tendered by the appellant to explain identity of creditors, creditworthiness of the creditors and the genuineness of the loan transactions. Hence, the impugned addition of Rs. 24.75 crore is hereby deleted." 17. There should not be any dispute that the initial burden to prove the cash credits is placed upon the shoulders of the assessee. It has been held by Honourable Courts that the initial burden shall be discharged, if the assessee proves three main ingredients, viz. the identity of the creditor, the creditworthiness of the creditor and genuineness of the transactions. If the assessee has discharged the initial onus, then the onus to disprove the same is shifted....
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....and others have been retracted. The question whether the revenue is entitled to place reliance on the retracted statements remains unanswered. Further, the assessing officer has placed reliance on the various observations made by the search officials like, sharing of common address by various concerns, inducting employees as directors etc., to come to the conclusion that these transactions are bogus in nature. We notice that the search officials have only drawn adverse inferences on the basis of information gathered by them and it is the duty of the assessing officer to substantiate those inferences by bringing corroborative materials. The Ld CIT-DR has reiterated these inferences as surrounding circumstances. However, the moot point that remains is by the assessee to prove the cash credits? The various furnished by the assessee, in fact, disprove the inferences drawn by the search officials. When the assessing officer could not disprove the material evidences furnished by the assessee, in our view, he is not entitled to place full reliance on the inferences drawn by the search officials, particularly the assessee could rebut those presumptions drawn by the search officials. Though....
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....asked for an opportunity to cross examine them. However, the AO has failed to furnish copies of sworn statements and also did not afford opportunity, to cross examine the deponents. Hence the decision rendered by Hon'ble Supreme Court in the case of Andaman Timer Industries (supra) goes in favour of the assessee and accordingly the Ld CIT(A) was justified in placing reliance on the same and holding that the impugned additions are not justified. 23. We notice that the assessee has specifically asked the AO to issue summons to the loan creditors, but the assessing officer has failed to do the same. It is pertinent to note that the assessee has so requested the AO, even after discharging the initial burden of proof by furnishing all the relevant details available with it. In the case of Orissa Corporation P Ltd (supra), the assessee furnished available details and then requested the AO to issue summons to the creditors, since it could not collect further details from them. The AO failed to do so and hence the Hon'ble Supreme Court held that the addition made u/s 68 is not justified. The assessee herein, in our view, stand on a stronger footing. The assessee has furnished all....
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....considering the facts of the case, applicable case lawsand has taken a justifiable view in this matter. Hence we do not find any infirmity in the order passed by Ld CIT(A). Accordingly we confirm the order passed by Ld CIT(A) in deleting the addition of Rs. 24.75 crores made u/s 68 of the Act. 25. Since we have confirmed the order of Ld CIT(A) in deleting the addition made u/s 68 of the Act, the interest disallowance is also liable to be deleted. Accordingly, we confirm the order passed by Ld CIT(A) in respect of interest disallowance also. 26. The addition made towards commission expenses is also offshoot of the addition made u/s 68 of the Act. For the reasons stated in the preceding paragraph, we confirm the order passed by Ld CIT(A) on this issue also. In the result, the appeal filed by the revenue is dismissed. 7. After having heard the counsels at length and after having 90 A ' through the facts of the present case as well as considering the order passed by revenue authorities, we find that in the present case, the AO had made the additions by treating the 'unsecured loans' receive by the assessee from 34 parties belonging to Bhawarlal Jain Group as 'unexplained lo....
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.... the AO did not supply the same. 9. Apart from that the AO had also failed to provide copy of "partywise ledger account" of the assessee containing details of corresponding cash received against loans on vartous dates and commission charged by Bhanwarlal Jain thereon. Therefore, in such circumstances, the AO had no valid basis for treating the 'unsecured loans' as 'accommodation entries'. There is nothing on the record to show that the assessee admitted at any point of time to have procured accommodation entries of loans. 10. We also found that the Hon'ble ITAT as mentioned above in assessee's own case, we find that the identical issue has already been decided by the Hon'ble ITAT in ITA No. 6099/Mum/16 for AY 2012-13 in assessee's own case. Therefore, on the basis of our above findings and also respectfully following the decision of the Coordinate Bench of Hon'ble ITAT and in order to maintain judicial consistency, we apply the same findings which are applicable mutatis mutandis in the present case. Resultantly, these grounds raised by the revenue stands dismissed. 11. These grounds raised by the revenue are general in nature, thus requires no specific adj....
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....no ground for not following it unless its operation has been suspended by a competent court. If this healthy rule is not followed, the result will only be undue harassment to assessee and chaos in administration of tax laws." 13.7 In the case of Kamlakshi Finance, referred supra, the Hon'ble Apex Court has also brushed aside the plea of the department that it would lose revenue and would also have no remedy to have the matter rectified. The Hon'ble Apex Court has emphasized that the orders of the higher authorities shall be followed and if the Department is correct, finally it will get its due A aikes, though after some procedural delay. The relevant portion of the da t in this regard, is reproduced below:| "7. The impression or anxiety of the Assistant Collector that, if he accepted the assessee's contention, the department would lose revenue and would also have no remedy to have the matter rectified is also incorrect. Section 35-E confers adequate powers on the department in ' this regard. Under Sub-section (1), where the Central Board of Direct Taxes come across any order passed by the Collector of Central Excise with the legality or propriety of which it is ....
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.... undersigned. 13.9 The law on Judicial Precedents & Contempt of Court has been elucidated upon by the Hon'ble Supreme Court in the case of CIT vs. Ralson Industries Ltd. - (2007) 288 ITR 322(SC), wherein it has been held that when an order is passed by a higher authority, the lower authority is bound thereby keeping in view the principles of judicial discipline. This aspect of the matter has been highlighted by the Hon'ble Apex Court in the case of Bhopal Sugar Industries vs. Income Tax Officer, Bhopal [AIR 1961 SC 182] in the following terms: « We think that the learned Judicial Commissioner was clearly in error in holding that no manifest injustice resulted from the order of the respondent conveyed in his letter dated March 24, 1955. By that order the respondent virtually refused to carry out the directions which a superior tribunal had given to him in exercise of its appellate powers in respect of an order of assessment made by him. Such refusal is in effect a denial of justice, and is furthermore destructive of one of the basic principles in the administration of justice based as it is in this country on a hierarchy of courts. If a subordinate tribunal refuses to ....
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....hat some Benches of the Tribunal have either taken independent view on the issue in this appeal or have later on followed Hon'ble Gauhati High Court, referred to above. However, with the latest judgment of Hon'ble Karnataka High Court in Kwality Biscuits Ltd.'s case (supra) the situation is materially different. In the hierarchical judicial system that we have, better wisdom of the court below has to yield to higher wisdom of the court above and, therefore, once an authority higher than this Tribunal has expressed an opinion on that issue, we are no longer at liberty to rely upon earlier decisions of this Tribunal even if we were a party to them. Such a High Court being a non-jurisdictional High Court does not alter the position as laid down by Hon'ble Bombay High Court in the matter of CIT v. Godavari Devi Saraf (1978) 113 ITR 589 (Bom). Therefore, we do not consider permissible to rely upon the earlier decisions of this Tribunal even if them is by a Special Bench. It will be wholly inappropriate for us views of one of the High Courts based on our perceptions reasonableness of the respective viewpoints, as such an exercise will de lacto amount to sitting in judgmen....
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....o amend or alter any ground and/or add new grounds which may be necessary." 9. The brief facts of the case are that the assessee filed its return of income on 27.08.2016 declaring total income to the tune of Rs. 189,05,300/- for the A.Y.2016-17. The case was selected for scrutiny under CASS and notice u/s 143(2) of the Act dated 07.07.2017 was issued and served upon the assessee. Assessment order u/s 143(3) of the Act was passed by the AO on 12.12.2018 determining total income of the assessee to the tune of Rs. 6,60,25,090/- after making certain additions/disallowance. Aggrieved by the said order, the assessee has filed the appeal before CIT(A) who allowed the claim of the assessee, therefore, the revenue has filed the present appeal before us. ISSUE NO.1 10. Under this issue the revenue has challenged the deletion of disallowance of Rs. 4,71,19,785/- on of sale shares of M/s. Mahavir Advanced Remedies. The Ld. Representative of the revenue has argued that the CIT(A) has wrongly deleted the disallowance of Rs. 4,71,19,785/-, therefore, the finding of the CIT(A) is not justifiable, hence, is liable to be set aside. However, on the other hand, the Ld. Representative of the assesse....
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....ck transaction. The AO had failed to bring any material on record, to show as to how the Appellant is connected to this general discussion made in the assessment order. Thus, the AO had failed to bring on record any specific evidence to corroborate it's finding that the impugned share loss was bogus. 10.2 I have noted that the AO had stated in the assessment order that information was received from the Investigation Wing that M/s. Mahavir Advanced Remedies DM is a penny stock and it has been used for booking bogus LTCG/STCL and business loss. But the AO had failed to bring on record, as to what information was received from the Investigation Wing in relation to the Appellant on the basis of which it is held that the share loss was bogus. The Appellant had specifically stated that 'there is no specific mention of the name of the Appellant in the information of Kolkata Inv. Wing. Further, the Appellant had stated that the material on record shows that the enquiry carried out by the Inv. Wing of Kolkata did not reflect the name of the Appellant as the beneficiary. I have noted that the AO is duty bound to at-least spell out in the assessment order, as to what adverse material had be....
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....proceedings. The investment in the impugned scrip had been made through own funds and funds raised from Religare Finvest. Thus, the AO had imputed a grave charge of Exit Provider on the Appellant, without adducing any evidence to substantiate the same. No Enquiries conducted by the AO 11.0 It is pertinent to note that the Assessing Officer had wide powers to issue summons to parties u/s 131 of the Act or could have called for information u/s 133(6) of the Act. The AO should have enquired the details of purchase and sale, if there was any doubt in his mind about the authenticity of the plethora of documents filed by the Appellant to support the genuineness of his claim. Instead of doing these exercises, the AO had passed the order with a pre-determined mind set and disallowed the loss without making any enquiries. 11.1 The Hon. Supreme Court in the case of CIT v. Orissa Corporation P. Ltd. 159 ITR 78 had held, as under: "Held, that in this case the respondent had given the names and addresses of the alleged creditors. It was in the knowledge of the Revenue that the said creditors were income tax assessees. Their index numbers were in the file of the Revenue. The Revenue, apa....
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....had contended that he had waited for re-listing of the stock for more than 10 months and in the end due to requirement of funds, he had to per-force sell the scrip off-line. I have noted that in view of the suspension of "the on-line trading of the stock, there was no option left with the Appellant but to sell the scrip off-line. Purchase & Sale of Shares is well documented 13.0 I have noted that the Appellant had filed all he possible documentation in relation to the purchase and sale of the impugned scrip, which had been challenged by the AO 'he document copies of the contract notes, broker ledger, bank statements, source of payment for purchase, demat account, confirmations etc. 13.1 At the outset, it is clarified that the basic facts narrated by the AO in Para 5.1 of his assessment order viz. "... the scrip was purchased and sold » is an incorrect statement. It is clear from the records that the said shares were purchased by the Appellant in the last year and hence the finding given by the A.O. on this account is wrong. 13.2 During the course of the appellate proceedings, the Appellant had contended that the AO had made the addition without appreciating the fact t....
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....s, if as per the AO the said purchase of shares of M/s Mahavir Advanced Remedies Ltd. was just an accommodation entry, then the amount of Rs. 4,86,51,534.50 should have been taxed in the A.Y. 2015-16. However, I have noted that the AO had after examination of the impugned penny stock transactions, accepted them and no adverse observation was made in the assessment order for A.Y. 2015-16. 13.6 I have noted that the sale of shares is also evidenced by bank Statement showing receipt of consideration, Demat Statement showing delivery of shares and confirmation letter duly signed by buyer. None of these evidences were controverted by the AO in the assessment order. During the course of the Appellate proceeding, it has been contended that the Appellant had fulfilled all the requirements necessary for discharging its onus. 13.7 It is brought on record that where the purchase and sale transactions are supported and evidenced by bills, contract notes, demat statements, bank statements etc., the same could not be treated as bogus simply on the basis of some reports of the investigation Wing and/or the orders of the statements of third parties. In support of the aforesaid, reliance is pla....
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....o long as the transaction meets the specific conditions laid down in the Act, an attempt to negate it or interpret it by applying the yardsticks of rationality, prudence etc., which in any case is highly subjective, would not meet the ends of justice and basic tenets of judicial interpretation or tax administration. Neither Sale nor Purchase linked with Entry Operators. 15.0 It is pertinent to note that there is no evidence on record, which directly links the Appellant with any of operators/intermediaries or proves that the Appellant was involved in any price rigging of the shares, or that they received any cash for getting the bogus loss. A perusal of the assessment order reveals that there is not even an tota of evidence had been brought on record to show that the counter parties in relation to the purchase and sale of the impugned penny stock are Entry Operators / Exit Providers / Shell company / Bogus Concerns. From, the assessment order passed by the AO, it is not at all clear as to what is the material evidence on the basis of which the purchase and sale of the shares had been held to be bogus by him. 15.1 In fact, the AO had failed to bring on record, the counter party m....
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.... u/s 133(6) of the Act. 15.2 Be that may, it is to be noted that there is nothing on record to hold that that the counter parties to the purchase and sale are entry operators / exit providers. I am of the considered opinion that the AO can't hold the transactions of purchase and sale as bogus, without carrying out any enquiry and without bringing on record any adverse material. Profit on Penn Stock scrips offered for taxation: 16.0 It is an undisputed fact that the Appellant had been regularly trading in the equity market with high volumes of trades and the same is duly corroborated by the profit and loss account and Balance Sheet of the Appellant placed on record. It can be seen from the details on record that the Appellant had in the earlier years also earned profit by trading 17.0 I have taken note of the fact that the assessment order of the A.O. itself starts with the heading "Suspicion of the Revenue". The entire case of the AO is based on presumption that the Appellant had claimed bogus business loss by trading in penny stocks, though no evidence had been brought to substantiate the same. The presumption or suspicion however strong it may appear to be true, but needs....
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...., then nothing can be implicated against the assessee". 17.4 Reliance is also placed on the decision of Hon'ble Calcutta High Court in the case of M/s Classic Growers Ltd. vs. CIT [ITA No. 129 of 2012(Cal)]. In this case, the Assessing Officer found that the evidences produced by the Appellant to support huge losses claimed in the transactions of purchase and sale of shares were stage managed. The Hon'ble High Court held that the opinion of the Assessing Officer that the assessee generated a sizeable amount of loss out of prearranged transactions so as to reduce the quantum of income liable for tax might have been the view expressed by the Assessing Officer but he miserably failed to substantiate the same. The High Court held that the transactions were at the prevailing price and therefore the suspicion of the Assessing Officer was misplaced and unsubstantiated. 17.5 Raising of presumption itself does not amount to proof. Presumption however strong, cannot take the place of evidence. Reliance is placed on the decisions of Pooja Bhatt 66 TTJ (Mum) 817& D. M. Kamani (HUF) 65 TTJ (Pat) 504.It is well settled by the Hon'ble Supreme Court in more than one decision that courts have t....
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....Kapoor [2008] 299 ITR 179did not believe on the allegation and held as under: "A cheque had been taken by the beneficiary ie. by paying cash equivalent to the cheque amount and the premium thereon". [he Hon'ble Court at page 182 observed: There wus no matenai before the Assessing Officer, which could have led to « conclusion that the transaction was, simpliciter a device to camouflage activities, to defraud the Revenue. No such presumption could be drawn by the Assessing Officer, merely on surmises and conjectures". 17.10 The Hon'ble Supreme Court in Parimisetti Seetharamamma v. CIT [1965] 57-ITR-532 at 536-537 observed, as under: 'By sections 3 and 4, the Indian Income-tax Act, 1922, imposes a general liability to tax upon all income. But the Act does not provide that whatever is received by a person must be regarded as income liable to tax. In all cases, in which a receipt is sought to be taxed as income, the burden lies upon the department to prove that it is within the taxing provision. Where however a receipt is of the nature of income, the burden of proving that it is not taxable, because it falls within an exemption provided by the Act, lies upon the asse....
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....hat the evidences filed by an assessee are false or fabricated or bogus. Reliance is placed on the following judgment of the Hon'ble High Court' Tribunal's, in which similar disallowance made on identical facts have deleted: a) CIT vs. Shri Mukesh Ratilal Marolia (Income Tax Appeal No.456 of 2007, order dtd. 07/09/2011, Bom HC) b) shyam R. Pawar (54 Taxmann.com 108, Bom HC) Manishkumar Baid and Mahendra kumar Baid vs. ACIT, Cir.35, Kolkata (ITA No.1236 & 1237/Kol/2017, order dt. 18/08/2017, ITAT Kolkata) a) A.C.I.T., Circle-7, Ahmedabad vs. Vineet Sureschandra Agarwal (ILT.A. no.1442/Ahd/2013, order dt. 6/1/2017, ITAT Kolkata) e) A.C.LT. Circle Pali vs. Shri Pankaj Raj Shah (I.T.A. no.330/odh/2011, order dt. 28/06/2016, ITAT Jodhpur) f) Ms. Farrah Marker vs. I.T.O. 19(3)(1), Mumbai. I.T.A. no.3801/Mum/2011, order at. 27/04/2016, ITAT Mumbai) g) I.T.O. - 24(3)(1), Mumbai vs. Indravadan Jain HUF and A.C.LT. - 24(3), Mumbai vs. Indravadan Jain I.T.A. no.4861 & 5618/Mum/2014, order dat.27/05/2016, ITAT Mumbai) 19.1 In the case of CIT vs. Jamna Devi Agarwal-[2012] 2taxmann.com 529 (Bom HC), the Hon'ble Bombay High Court had held that from the documents produced befor....
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....er to show according to him that these transactions were deliberately entered into for the purpose of reducing the liability to pay capital gain tax. 6. On the basis of a suspicion howsoever strong it is not possible to record any finding of fact. As a matter of fact, suspicion can never take the place of proof. What were the individual facts and circumstances in the case of other investors indicated in the chart appearing at Page-51 of the paper book are not known to us. In so far as the assessee is concerned, the facts and circumstances are before us which we have also tabulated. The finding arrived at by the Tribunal indicated above was not even alleged by Mr. Dutta to have not been based on evidence. In the teeth of the aforesaid findings made by the Tribunal on the basis of evidence, it is difficult, if not impossible, to hold that the transaction of buying and selling of shares of Hindustan Development Corporation Ltd. was a colourable transaction or was resorted to with any ulterior motive of reducing the tax payable for long term capital gain. The first ground of appeal is regarding perversity of the judgment of the learned Tribunal. Mr. Dutta did not cite one example t....
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....ned the same. We are unable to agree with the submission that an act which Is otherwise valid in law can be treated as non-est merely on the basis of some underlying motive supposedly resulting in some economic detriment or prejudice to the national interests, as perceived by the respondents." 20.1 In Banyan and Berry v. Commissioner of Income-tax [1996] 222 ITR8&31 (Guj), it was held as under: "...The Court nowhere said that every action or inaction on the part of the taxpayer which results in reduction of tax liability to which he may be subjected in future, is to be viewed with suspicion and be treated as a device for avoidance of tax irrespective of legitimacy or genuineness of the act ; an inference which unfortunately, in our opinion, the Tribunal apparently appears to have drawn from the enunciation made in McDowell's case [1958] 154 ITR 148 (SC). The ratio of any decision has to be understood in the context it has been made. The facts and circumstances which lead to McDowell's decision leave us in no doubt that the principle enunciated in the above case has not affected the freedom of the citizen to act in a manner according to his requirements, his wishes in the ....
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....r shows that the transactions of the Appellant are not pre-meditated or pre-arranged. Genuine Share Transactions Judicial View 22.0 The Hon'ble Bombay High Court in the case of CIT v. Shyam R. Pawar 54 taxman.com 108 (Bom) had held that where DMAT account and contract note showed details of share transaction, assessing Officer were sold, on what dates and for what consideration and the sums received by cheques have been referred extensively by the Tribunal in para 10. A copy of the DMAT account, placed at pages 36 & 37 of the Appeal Paper Book before the Tribunal showed the credit of share transaction. The contract notes in Form-A with two brokers were available and which gave details of the transactions, The contract note is a system generated and prescribed by the Stock Exchange. From this material, in para 11 the Tribunal concluded that this was not mere accommodation of cash and enabling it to be converted into accounted or regular payment. The discrepancy pointed out by the Calcutta Stock Exchange regarding client Code has been referred to, But the Tribunal concluded that itself, is not enough to prove that the transactions in the impugned shares were bogus/sham. The detai....
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....under: "8. We have considered rival contentions and carefully gone through the orders of authorities before and found from the record that the AO has treated the share transaction as bogus on the plea that SEBI has initiated investigation in respect of Ramkrishna Exports Pvt. Ltd. The AO further stated that investigation revealed that transaction through M/s. Basant Perival and Co. on the floor of stock exchange was more than 83%. We found that as far as initiation of investigation of broker is concerned, the assessee is no way concerned with the activity of the broker. Detailed finding has been recorded by CIT(A) to the effect that assessee has made investment in shares which was purchased on the floor of stock exchange and not from M/s. Basant Perival and Co. Against purchases payment has been made by account payee cheque, delivery of shares were taken, contract of sale was also complete as per the Contract Act, therefore, the assessee is not concerned with any way of the broker. Nowhere the AO has alleged that the transaction by the assessee with these particular broker or share was bogus, merely because the investigation was done by SEBI against broker or his activity, assess....
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....merely on the basis of the reasons that share broker was involved in dealing in share of a particular company in collusion with other or in the manner of unfair trade practice against the norms of SEBI and Stock Exchange, then merely because of that fact a person who bonafidely entered into share transaction of that company through such broker then only by mere assumption such a transaction cannot be held to be a sham transaction." 22.4 The Hon'ble Jharkhand High Court had further held, as under "It is not disputed by the revenue before us that the share of these already shown in the balance sheet submitted by the assessee, and therefore, in that situation, how the revenue condemn the transaction even on the ground of sleep rise in the share. If within a period of one year, the share price had risen from Rs. 5 to 55 and from 9 to 160 and one person was holding the shares much prior to that start of rise of the share price, then how can it be inferred that such transaction entered into a sham transaction few years ago and prepared for getting the benefit after few years when share will start rising steeply. In the present case even there was no reason for such suspicion when....
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....e cited case, ie. Jatin Chandra (supra), Harkhchand K. Gada (HUF) & Others (supra) and Andaman Timber Industries (supra) would be applicable and support the case of the assessee since no adverse finding has been rendered in respect of the direct material evidence placed on record in respect of here transaction of purchase and sale of the "said shares" of M/s. Shukun Constructions Ltd. Which stand duly disclosed in her audited Balance Sheet filed with the return of income of assessment years 2004-05 and the current year under consideration. In this factual and legal matrix of the case, as discussed above, we find that the addition of Rs. 95,12,812/under section 68 of the Act made and confirmed by the authorities below to be unsustainable and therefore direct the AO to delete the said addition and accept the LTCG income of Rs. 93,00,012/- shown as exempt under section 10(38) of the Act. Consequently, ground No.1 of the assessee's appeal is allowed." 22.7 During the hearings, the A.R. of the Appellant had distinguished his case from the case of Sanjay Bimalchand Jain L/h Shantidevi B. Jain v. CIT of Mumbai High Court, Nagpur Bench in Income Tax Appeal No.18/2017.1n the said case the....
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....rds, as it is now expressed, 'justice should not only be done but should manifestly be seen to be done'. 23.4 Till the beginning of 20th Century, the applicability of these principles was restricted to the judicial and quasi-judicial authorities. However, with the obscuring of the demarcation between the quasi-judicial and administrative functions, these principles were equally applied to the administrative functions. 23.5 In the case of State of Orissa v. Dr. (Mrs) Binapani Dei (AIR 1967 SC 1269), the Apex Court observed that 'even an administrative order which involves civil consequences...must be made consistently with the rules of natural justice'. In the case of Mohinder Singh Gill v. Chief Election Commissioner, New Delhi ([1978] 1 SCC 405], while defining the term 'civil consequence', the Hon'ble Supreme Court said, 'civil consequence' undoubtedly cover infraction of not merely property or personal rights but of civil liberties, material deprivations and non-pecuniary damages. In its comprehensive connotation, everything that affects a citizen in his civil life inflicts a civil consequence'. The Apex Court has reiterated this view in the case of S.L. Kapoor v. Jagmoh....
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....d that the statements of a partner of another firm upon which the Sales Tax Tribunal relied, had not been tested by cross examinations. 23.10 The Hon'ble Rajasthan High Court in CTO v. Haryana Dal Mill [1993] 90 STC 519 dismissed the departmental revision petitions on the ground that the respondent not having been given opportunity to discredit the entries or cross examine the agent and the entries not having been proved nor the agent examined, the order of the Board of Revenue was not justified. 23.11 The Hon'ble Kerala High Court in P.S. Abdul Majeed v. Agricultural Income tax & Sales Tax Officer [1994] 209 ITR 821 in a writ petition by the Petitioner-Assessee held that there were two inspections of the Petitioner's -holdings on November 3, 1981, and on September 19, 1985, before and after the assessment year in question, when the inspecting authorities estimated the yield of cardamom from the petitioner's holdings at 180 Kgs. The order of reassessment was made without any reference to either of these records but merely on the strength of the entries in the auctioneers' records. Reliance on the auctioneers' records and treating them as if they were conclusive ....
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..... DCIT 287 ITR 91 held that principle of natural justice should be followed in the case where a person suffers civil consequences though the principle of natural justice is not impliedly mentioned. By passing of assessment order and creating a demand, there are civil consequences and the AO should have provided an opportunity. 23.17 A Constitution Bench of the Supreme Court in State of MP. y. Chintaman Sadashiva Waishampayan AIR 1961 SC 1623, held that the rules of natural justice, require that a party must be given the opportunity to adduce all relevant evidence upon which he relies, and further that, the evidence of the opposite party should be taken in his presence, and that he should be given the opportunity of cross-examining the witnesses examined by that party. Not providing the said opportunity to cross-examine witnesses, would violate the principles of natural justice. 23.18 In Lakshman Exports Ltd. v. Collector of Central Excise (2005) 10 SCC 634, the Hon'ble Apex Court, while dealing with a case under the Central Excise Act, 1944, considered a similar issue i.e. permission with respect to the cross-examination of a witness. In the said case, the Assessee had spec....
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....ite of the request of the assessee, evidence of M could not have been used against the assessee - Therefore, the assessment is vitiated." 23.22 In the case of Smt. Sunita Dhadda Vs. Deputy Commissioner of Income-tax [2013] 33 taxmann.com 639 (Jaipur Trib, the Hon'ble ITAT Jaipur has held that where A.O. made addition on account of 'on money' received by assessee on sale of land, relied upon statement director group and did not allow assessee to cross-examine, there was violation of principle of natural justice and addition could not be sustained. The said deletion has been upheld by the Hon'ble High Court & Supreme Court. 23.23 In Bangodaya Cotton Mills Ltd. vs. CIT [2009] 21 DTR 200 (Cab), it was held that the A.O having made the impugned addition simply on the basis of some letters seized from a third party in the absence of any corroborative evidence and without issuing summons to the concerned person or making him available for cross-examination, the order passed by the Tribunal upholding the addition is set aside and the matter is remanded back to the A.O to consider the matter afresh. 23.24 In CIT Vs. Sanjeev Kumar Jain (2009) 310 ITR 178 (P&H), it was held ....
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....n of principles of natural justice and no substantial question of law arose. 23.30 In CIT Vs. A.N. Dyaneswaran (2008) 297 ITR 135 (Mad), it was held as under: "In the absence of any corroborative evidence, statement obtained from 23 mining licensees out of 994 licensees could not be relied upon by the A.O to come to the conclusion that the assessee has received illegal money from all the applicants for granting mining licenses, further the assessee was not allowed to cross-examine the said deponents and no further enquiry was made and therefore assessment suffers from procedural irregularities, defects and infirmities, matter is remanded to the A.O for fresh consideration." 31 In CIT Vs. SM Aggarwal 292 ITP 43, it was held that statement made the assessee's daughter cannot be said to be relevant or admissible against assessee, since the assessee was not given any opportunity to cross examine her and even from the statement, no conclusion can be drawn that the entries made on the relevant page belongs to the assessee and represents his undisclosed income. 23.32 As regards the onus of ensuring the presence of the witness, kind attention is drawn towards the judgment of the Ho....
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.... Ltd. v. DCIT, [2003] 84 ITD 320 (Mum), there was a search at the premises of Shri Niranjan Shah, in which a computer floppy was found. On the basis of the contents of the above floppy, the Revenue held that the assessee had borrowed the money in cash which was denied by the assessee. In support of its contention, the Revenue has relied upon. 132(4A). Under the given facts, the Hon'ble Mumbai ITAT held asunder- "7. Coming to the merits of the penalty levied, the main basis for levy of the penalty is the computer floppy found from the residence of Shri Niranjan J. Shah. The print-out of the above computer floppy showed several transactions between Shri Shah and the assessee-company. The above transactions included some transactions by cheque and some by cash. The assessee had admitted the transactions by cheque but had denied the transactions which were in cash. The Department, in support of its contention, has heavily relied upon the presumption provided under Section 132(4A) of the IT Act, while the assessee disputed the applicability of Section 132(4A) to the present proceedings on the following grounds : (i) that the presumption under Section 132(4A) is limited only to t....
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....oks of account or documents are true. In our opinion, this presumption can also be applied only against the person from whose possession the books of account or the documents were found. Therefore, so far as the case of Mr. Niranjan J. Shah is concerned, the Revenue authorities may presume that the books of account or documents found from his possession are correct. However, while utilizing those documents in the case of any other person (i.e. the person other than Mr. Niranjan J. Shah), there cannot be any presumption about the correctness of such books or documents. The Hon'ble apex Court has considered this matter in the case of CBI v V.C. Shukla (supra). In that case, certain diaries, small note book and various loose papers were found and seized from the premises of Mr. S.K. Jain of New Delhi. In those diaries/loose papers, the names of V.C. Shukla and L.K. Advani were found recorded. The CBI charge-sheeted those persons, namely, Shri Shukla and Shri Advani under the Prevention of Corruption Act, 1988. The Hon'ble apex Court held that the entries in those diaries/loose papers cannot be used against Shri Advani or Shukla but can be used against Shri Jain and may be pr....
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....discretion of the Court, depending upon other factors, to decide whether the presumption must be drawn. The expression used in the sub-section is "may be presumed" as is used in Section 114 of the Evidence Act, 1872. It is not a mandate that whenever the books of account are seized, the Court shall necessarily draw the presumption, irrespective of any other factors which may dissuade the Court from doing so." Similar view was expressed by Their Lordships of Rajasthan High Court in the case of CIT v. S.M.S. Investment Corpn. (P) Ltd. (1994) 207 ITR 364 (Raj) where it was held that the presumption under Section 132(4A) is rebuttable. In view of above, we hold that the presumption under Section 132(4A) is only a rebuttable presumption and not a conclusive one. The learned Departmental Representative has relied upon various decisions. However, all of them are on altogether different facts. The dispute before the Hon'ble Kerala High Court in the cases of CIT v. K. Mahim (supra) and CED v. Smt Sarala Nair and Ors. _ (supra) was whether the purchase of property was Benami or not, while the issue in the case under appeal before us is altogether different. Similarly, the facts in th....
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....ined the assessment orders as well as the order of the Commissioner of Income-tax (Appeals). The loss incurred in share dealings is disallowed by the Income-tax Officer and confirmed by the Commissioner of Income-tax (Appeals) on the presumption that no prudent businessman would undergo loss and investments are always made to earn income by banks and (sic). This concept does not appear proper. To make investment in share dealings is also made for earning income. While doing so, if any loss is incurred, it cannot be said that the loss is incurred to divert the income or it is stage-managed. The appellants found that at the end of the financial year the value of the shares was going down and the assessee thought it proper to fetch whatever was possible by selling the shares at that time at a lower rate. That act does not mean that the loss is stage-managed." 3. It is also brought to our notice that on almost similar facts this Court has considered the similar issue in the case of CIT v. Carbo Industrial Holdings Ltd. [2000] 244 ITR 422 and answered the question in favour of the assessee. 4. The admitted facts in this case are that the details of purchase and sale of shares are fu....
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....s, statements etc. have noted that on both counts, impugned assessment order fails, squarely. 27.8 In view of the above facts and circumstances, as also the binging decisions of the Hon'ble Courts, I am of the considered opinion that the disallowance of loss amounting to Rs. 4,71,19,785/- made by the AO is unsustainable in law and is therefore, deleted. Accordingly, Ground of Appeal No. 1 to 3 raised by the Appellant are allowed." 11. On appraisal of the above mentioned finding, we noticed that the CIT(A) has relied upon the decision of the Hon'ble Calcutta High Court in the case of M/s. Classic Growers Ltd. Vs. CIT (ITA. No. 129 of 2012 (Calcutta), and the decision of the Hon'ble Supreme Court in the case of Chuharmal Vs. CIT (1998) 172 ITR 250, CIT Vs. Emerald Commercial Ltd. (2002) 120 taxman 282 (Calcutta) and in the case of Dhaeshwari Cotton Mills Vs. CIT (1954) 26 ITR 775 and in the case of CIT Vs. Anirudh Narayan Agrawal (2013) 38 taxmann.com 367 (All) and various decision of the Hon'ble Courts mentioned above. Moreover, no law contrary to the law relied by the CIT(A) has been produced before us. There is no cogent and convincing evidence on record to hold this fact that ....