AI Drafter 
TaxTMI 
TaxTMI 
TaxTMI 
2023 (3) TMI 341
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....:- ''4. Decision of the appellate authority 5.1 On perusal of the details on records, it is evident that the appellant is contesting the addition of Rs 6, 12, 367/- made by the Ld A O by denying exemption for Long Term Capital Gain u/s 10(35). The assessee purchased 50 share of M/s Rani Sati Commotrade P Ltd for Rs 500, the payment was made in cash. The purchase of shares is off market transaction and paid in cash. These shares were purchased from one Pushpanjali Commotrade Pvt Ltd. Subsequently, the Rani Sati Commotrade Pvt Ltd amalgamated with M/s Blue Print Securities Ltd a public limited company. As per amalgamation scheme the assessee received 2000 shares of M/s Blue Print Securities Ltd. During the year, assessee sold these shares @Rs. 307 per share for total sale proceeds of Rs 6, 14,000/-. The assessee computed Long Term Capital Gains and claimed the same as exempt u/s 10(35). The Id AO on deeper investigation as narrated in para 5 to 7 of his order, he found facts to suggest that the above transaction is not genuine and hence, concluded exemption claimed u/s 10(35) is to be disallowed. 5.2 I have sincerely considered the submissions of the assess....
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.... was no information before him for any escaped assessment as in these reasons recorded the Ld.AO has stated that the assessee was beneficiary of receiving bogus short term/long term capital gain entries from the bogus/fake entry providers i.e., M/s Blue Prints Securities Ltd. as no transaction was made by the assessee with M/s Blue Prints Securities Ltd. and no bogus/ fake entry was provided by this company. The re-opening of the assessment was made in suspicion and on whims only. No needful enquiry or investigation was made by the Ld.AO before re-opening the assessment hence, the Ld.AO erred in re-opening the assessment, which is unjustified and bad in law. During the course of assessment proceedings, detailed computation of income (PB-2) expalaining all the sources of income and various activities done by the assessee, datewise statement of long term capital gain on sale of shares (PB- 2) having the complete datewise details of purchases and sales of shares, copies of contract notes (PB-3) in support of sales and purchases, copy of bank statement (PB-6) alongwith copy of account payee cheque (PB-4) evidencing the receipt of sales consideration of sales ....
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....hout conducting any enquiry from the relevant parties or independent source or evidence but has merely relied upon the statements recorded by the Investigation Wing as well as information received from the Investigation Wing. It is apparent from the Assessment Order that the Assessing Officer has not conducted any independent and separate enquiry in the case of the assessee. Even, the statement recorded by the Investigation Wing has not been got confirmed or corroborated by the person during the assessment proceedings. It is provided u/s. 142 (2) of the Act that for the purpose of obtaining full information in respect of income or loss of any person, the Assessing Officer may make such enquiry as he considers necessary. In our considered view the Assessing Officer ought to have conducted a separate and independent enquiry and any information received from the Investigation Wing is required to be corroborated and affirm during the assessment by the Assessing Officer by examining the concerned persons who can affirm the statements already recorded by any other authority of the department. Facts narrated above clearly show that the Assessing Officer has not made any enquiry a....
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....prove the evidences produced by the assessee. The report of Investigation Wing is much later than the dates of purchase / sale of shares and the order of the SEBI is also much later than the date of transactions transacted and nowhere SEBI has declared the transaction transacted at earlier dates as void. Considering the vortex of evidences, we are of the considered view that the assessee has successfully discharged the onus cast upon him by provisions of section 68 of the Act as mentioned elsewhere, such discharge of onus is purely a question of fact and therefore the judicial decisions relied upon by the DR would do no good on the peculiar plethora of evidences in respect of the facts of the case in hand and hence the judicial decisions relied upon by both the sides, though perused, but not considered on the facts of the case in hand." 4. (ITAT, Jaipur bench) in the case of M/s Shree Silika Product Pvt.Ltd. (JP-ITAT) 2020 ITL 162 dt.of order 07.01.2020 in which it has been decided that "it is an admitted fact that the AO reopened the assessment on the basis of information received from the Investigation Wing that during the course of search & seizure operation of various ....
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....n view the ratio laid down by the Hon'ble Jurisdictional High Court in the aforesaid referred to case of Principal Commissioner of Incometax vs. G & G Pharma India Ltd., are of the view that the reopening done by the AO u/s 147 of the Act was not valid and accordingly the ITA No. 491/Del/2016 Layak Fabrics Pvt. Ltd. 16 subsequent assessment framed by the AO was void- abinitio and therefore the same is quashed". Similar decisions have also been made by hon'le ITAT, Jaipur bench in the following cases:- 1. CIT v/s Pooja Agrawal DB ITA No.385/2011 Hon'le Rajasthan High Court dt.of decision 11.09.2017 2. Meghraj Shekhawat v/s DCIT in ITA No.443& 444/JP/2017 Hon'le ITAT, Jaipur bench 07.03.2018 3. DICT v/s Saurabh Mittal in ITA No.16/JP/2018 Hon'le ITAT, Jaipur bench 29.08.2018 But it it very unfortunate that the Ld.CIT(A) without considering the detailed written submissions and judicial pronouncements relied in the appeal, has very arbitrarily decided that "it was as sham transaction whci cannot stand and the test of human probability and therefore, addition so made by the AO is hereb confirmed, but the Ld.CIT(A) has not decided the grou....
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....1 ITL 2057 Nilesh Agrawal HUF v.ITO ITA No.222-223/JP/2020 Dt. of Order 09.02.2021 2. (Rajasthan High Court) DBIT No.209/2018 PCIT v. Pramod Jain Dt. of Order 24.07.2018 3. (Delhi High Court) ITA No.125/2020 PCIT v. Smt.Krishna Devi Dt. of Order 15.01.2021 4. (ITAT, Jaipur bench) in the case of M/s Shree Silika Product Pvt.Ltd. (JPITAT) 2020 ITL 162 dt.of order 07.01.2020 5. CIT v/s Pooja Agrawal DB ITA No.385/2011 Hon'le Rajasthan High Court dt.of decision 11.09.2017 6. Meghraj Shekhawat v/s DCIT in ITA No.443& 444/JP/2017 Hon'le ITAT, Jaipur bench 07.03.2018 7. DICT v/s Saurabh Mittal in ITA No.16/JP/2018 Hon'le ITAT, Jaipur bench 29.08.2018 But it it very unfortunate that the Ld.CIT(A) without considering the detailed written submissions and judicial pronouncements relied in the appeal, has very arbitrarily decided that "it was as sham transaction which cannot stand and the test of human probability and therefore, addition so made by the AO is hereby confirmed. We pray to your honor to please consider the above submissions and please allow the appeal.'' 2.3 On the other hand, the ld. DR supported the orde....
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....nto consideration the orders of the lower authorities and the decisions cited therein. The Bench noted that the issue raised by the assessee is covered by the order of ITAT Jaipur in the case of Nilesh Agarwal, HUF vs ITO (ITA No. 222-223/JP/2020 dated 9-02-2021) wherein the Bench has observed as under:- ''13. Similarly, in the instant case, the assessee is still holding 413,500 shares of M/s. Kailash Auto in his Demat account. The AO has treated the transaction of sale of 66,500 shares as bogus being accommodation entry but has not doubted the holding of the shares by the assessee to the tune of 4,13,500 shares in the Demat account of the assessee. Once the assessee has produced all the supporting evidences which include purchase bill, bank statement showing the payment of purchase consideration, Demat account, holding of shares in the Demat account, sale of the shares through Stock Exchange which are also reflected in the Demat account of the assessee and receipt of the sale consideration in the bank account of the assessee as it is evident from the bank account, statement of the assessee, then in the absence of any contrary material or evidence brought on record by the ....