TaxTMI 
TaxTMI 
TaxTMI 
2023 (4) TMI 272
X X X X Extracts X X X X
X X X X Extracts X X X X
....cle-10(1), Kolkata u/s. 147/143(3) of the Income-tax Act, 1961 (hereinafter referred to as the "Act"), dated 16.12.2017. 2. Grounds raised by the revenue are reproduced as under: "1] That on the fact and circumstances of the case, the Ld. CIT(A)-4, Kolkata erred in deleting the addition of Rs. 2,99,85,863/- u/s. 68 of the Act by wrongly holding that what could be added even in case of bogus or contrived transaction is net result of purchase and sale and not the entire sales, without appreciating material facts and evidences of this case. 2] That on the facts and circumstances of the case, the Ld. CIT(A)-4, Kolkata erred in deleting addition of Rs.5,76,752/- (Rs.5,99,755 (-) Rs.23,003) u/s. 37(1) of the Act by wrongly holding that in t....
X X X X Extracts X X X X
X X X X Extracts X X X X
....vide intimation dated 12.02.2011, which was subsequently rectified u/s. 154 of the Act with the last order passed u/s. 154 dated 20.07.2016. Subsequently, a notice u/s. 148 of the Act dated 31.03.2017 was issued on the assessee and served thereon. Assessee filed its return in response to the said notice u/s. 148 reporting total income at nil. Ld. AO observed that assessee had derived speculative income from commodities through member/broker of NMCE, Fast Track Marchants Pvt. Ltd. Ld. AO further noted that trades were executed with the counter-party clients M/s. Fairdeal Vincom Pvt. Ltd. and M/s. Anand Share Broking (P) Ltd. Assessee submitted copy of contract notes, bank statements and other relevant documents to substantiate its claim. 3.....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... said amount and added it by disallowing u/s. 37(1) of the Act. Aggrieved, assessee went in appeal before the ld. CIT(A). 3.2. Before the Ld. CIT(A), assessee reiterated the submissions, the details in respect of the transactions under taken by the assessee is tabulated below: Contract No. Date Difference being Profit/Loss Net of Brokerage & S. Tax (Rs.) Brokerage (Rs.) Service Tax (Rs.) 00000379/0910 21.07.2009 4,98,719,58 1,376.50 142.92 001378/0910 24.02.2010 4,98,900.61 1,450.00 149.39 001560/0910 12.03.2010 1,52,531.23 425.00 43.77 Total 11,50,151.42 3,262.50 336.08 3.3. In respect of the difference of Rs.3,598/- between the details furnished by the assessee and NMCE, it was submitted by assessee that ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....n the net result of purchase and sale of commodities transaction as income in its return and thus deleted the addition of Rs.2,99,85,863/-. However, Ld. CIT(A) directed the ld. AO to compute commission on the commodity transaction by taking 2% of the net speculative income reported by the assessee as against what Ld. AO took as 2% of the total sales value. Further, Ld. CIT(A) while disposing ground no. 10 in respect of allowing set off of brought forward loss and depreciation noted that the commodity profit has been held to be bogus. For the purpose of allowing set off of brought forward loss/depreciation, Ld. CIT(A) observed that either this profit does not exist or alternatively the Ld. AO has to allow the set off of past losses and thus,....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... Ld. AO and Ld. CIT(A), which are narrated above and are not repeated here for the sake brevity. 5. We have heard the rival contentions and perused the material available on record. We take note of the findings given by the Ld. CIT(A) in para 4.3 and 5 which are extracted below: "4.3. I have perused the Submissions of the ld. AR and the Assessment Order. The AO has added the entire turnover of the commodities to the assessee's income. What could be added even in case of bogus or contrived transaction is net result of purchase and sale and not the entire sales. To give an example, if an assessee shows bogus purchase of Rs. 5 crore and bogus sale of Rs. 5.01 crore then what could be added at most is the difference i.e. Rs. 1 lakh not t....
X X X X Extracts X X X X
X X X X Extracts X X X X
....lusion to sustain the addition of the net result of purchase and sale and not the entire sale and thus, deleted the addition made by the Ld. AO. However, while dealing with ground no. 10 in para 5, Ld. CIT(A) has held the commodity profit to be bogus. We note that while holding so, Ld. CIT(A) has not given his explanations, reasoning and the basis for arriving at such a conclusion. From these findings given in two paragraphs by the Ld. CIT(A) it is not discernible as to how and on what basis, Ld. CIT(A) has arrived at this conclusion. In the entire order, Ld. CIT(A) has merely extracted the observations of the Ld. AO and the submission of the assessee without dealing with them objectively and analytically. Accordingly, to meet the ends of j....