2022 (11) TMI 1137

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....(d) ('impugned order') of the Income Tax Act, 1961 ('the Act') and the notice ('impugned notice') issued under Section 148 of the Act, both dated 21st July, 2022, by the Income Tax Officer, Ward 54(1), Delhi for the Assessment Year ('AY') 2015-16. 2. The brief facts giving rise to the present proceedings are that the Petitioner Assessee was served Show Cause Notice ('SCN') dated 23rd May, 2022 under Section 148A(b) of the Act by the Assessing Officer ('AO') wherein it was stated that a search was conducted by the Investigation Wing, Rohtak on Tradenext Securities Ltd. (Earlier known as Lifeline Securities Limited) and the said entity is involved in providing accommodation entries through the modus operandi set out in the notice. It was sta....

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.... and this was ultimately transferred to the beneficiaries. Sh. Rakesh Sharma has stated that his account was mis-used and he had lodged FIR in regard to the same. Sh. Rakesh Sharma has also stated that he has never opened any Demat Account. 5. Some of the beneficiaries have admitted that they had no knowledge of Share trading and they had arranged exempt LTCG for 2-3% commission. 6. Modus-Operandi(MO)- * Cash will be received from various clients and this cash will be deposited in account of some dummy persons who would purchase shares of well known companies on exchange. * These stocks will subsequently be transferred to the beneficiaries in off-line/off- market transaction but the bills will be issued in past date at a much lower....

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.... material related to initiation of the reassessment proceedings. The Assessee did not dispute specific transaction in shares of Aurobindo Pharma through Mridul Securities as stated in the SCN in its reply. 4. After perusing the reply filed by the Assessee, the AO held that it is a fit case of issuance of notice under Section 148 of the Act. 5. Learned counsel for the Petitioner states that AO failed to appreciate that the Assessee has not claimed exempt Long Term Capital Gains ('LTCG') in the Return of Income ('ROI') filed for the relevant year. He further states that the AO appears to have initiated the proceedings on the wrong assumption that the Petitioner herein has claimed LTCG on the sale of the said shares, which is incorrect. He s....

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....cannot be maintained and the Assessee must establish the genuineness of the transactions in the re-assessment proceedings. 8. We have heard learned counsel for the parties and perused the paper book. 9. The Petitioner has not brought on record any relevant or contemporaneous documents evidencing the said purchase, i.e. bank statement etc., placed on record in this petition. As regards the disclosure, if any, of the purchase of the shares, in its earlier ROI, it was clarified by the learned counsel for the Petitioner that since the shares were bought in the same financial year, it is only the transaction with respect to sale of shares which is reported in the ROI. Thus, it is only the sale of shares which is documented by the Assessee in i....