AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2021 (9) TMI 540
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....in Form 36, for receipt of order from office of the CIT(A), as per which, the date taken as 12.06.2018 instead of 16.07.2018. if, actual date of receipt of order, i.e. 16.07.2018 is considered, then there is no delay in filing appeal. Therefore, delay may be condoned in the interest of advancement of substantial justice. 3. The learned DR, on the other hand, strongly opposing condonation of delay petition filed by the assessee submitted that the reasons given by the assessee do not come within the ambit of reasonable and bona-fide reasons, which can be considered for condonation of delay and hence, appeal filed by the assessee for assessment year 2012-13 may be dismissed as not maintainable. 4. Having heard both sides and considered the petition filed by the assessee for condonation of delay, we are of the considered view that reasons given by the assessee for not filing the appeal within the time allowed under the Act comes under reasonable cause as provided under the Act for condonation of delay and hence, delay in filing of appeal is condoned and appeals filed by the assessee for assessment year 2012-13 is admitted for adjudication. 5. The assessee has, more or less filed com....
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....nd Sapani . The order passed by the learned CIT(A) is totally against judicial discipline and is bad in law. The learned assessing officer as well as the CIT(A) erred in relying on a certain pattern of bogus claim which is totally irrelevant to facts of the appellants. The learned lower authorities erred in relying on investigation in the case of third party which has no bearing on the appellants transaction to disallow the claim of the appellant under section 10(38). The learned assessing officer as well as the CIT(A) have not brought to record any evidences to prove that the said transaction that the assesse had entered into was bogus in nature, basing the above purely on assumptions and suspicion. The learned assessing officer as well as the CIT(A) have not followed the doctrine of Res inter alios acta alteri nocere non debet and have, without any evidence to the same, held a valid transaction of the appellant as an unexplained credit." 6. Brief facts of the case as culled out from assessment order for Asst. year 2012-13 are that the assessee is an individual, derives income from business or profession and income from other source, filed her return of income for assessment ye....
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....the Department. 8. The assessee being aggrieved by the assessment order preferred an appeal before CIT(A). Before the learned CIT(A), the assessee submitted that the Assessing Officer has erred in making addition towards consideration received for sale of shares u/s.68 of the Act as unexplained cash credit, without appreciating fact that the assessee has purchased shares through recognized stock exchange and further, sold shares in recognized stock exchange for which necessary evidences including broker note and bank statements evidencing payment and receipt of consideration through cheque has been filed. The learned CIT(A), after considering relevant submissions of the assessee and also taken support from certain judicial precedents held that although the assessee claims to have purchased shares through recognized stock exchange and also utilized services of broker M/s.Kunvarji Finstock Pvt.Ltd. based at Ahmadabad, but failed to explain as to why she has availed services of a broker based at Ahmadabad for specific transaction of purchase and sale of shares of M/s. Tuni Textile Mills Limited., even though she is based at Chennai. The learned CIT(A) further noted that the broker M/....
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....at various High Courts, including the Hon'ble Delhi High Court, has considered similar issue in light of investigation carried out by income-tax department to unearth organized racket of penny stocks companies and after considering facts held that unless the Assessing Officer proves that there was an agreement between the parties to convert unaccounted money by taking fictitious long term capital gain in a pre-planned manner, he cannot proceed to make additions entirely on unsupported material on record. The AR further submitted that no doubt, there are divergent views on the issue, where some High Courts have held that once it is proved that scrip is a penny stock, then it is to be held that the assessee is also a beneficiary of bogus long term capital gain, but fact remains that in all those cases considered by Hon'ble High Courts and decided in favour of revenue, the fact was that purchase of shares was always offline either through private placement or purchase in grey market and sale was through recognized stock exchange. In this case, purchase as well as sale both are online and the assessee has paid and received consideration through cheque, therefore, case laws relied upon ....
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....explained cash credit and assessable u/s.68 of the Income Tax Act, 1961 and we do not ourselves subscribe to reasons given by the Assessing Officer as well as learned CIT(A), because both authorities had proceeded predominantly on the basis of analysis of financial statements of M/s.Tuni Textile Mills Ltd. We do not find anything to comment on the analysis of financials of the company by the Assessing Officer, but we do not agree with the conclusion arrived at by the Assessing Officer only on the basis of analysis of financial statement of the company to treat consideration received for sale of transfer of shares by the assessee as unexplained cash credit. No doubt, M/s. Tuni Textile Mills Ltd. may be named as penny stock by the income tax department based on facts gathered during the course of investigation. It may also be correct that financials of the company may not support such a huge rise in share price within short span of two years. But, these two facts alone are not sufficient to draw adverse inference against the assessee, unless the AO linked transactions of the assessee to organized racket of artificial increase in share price. 13. In this case, there is no dispute wit....