TaxTMI 
TaxTMI 
2019 (6) TMI 1698
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....e Respondent : Shri Sankar Halder, JCIT-SR-DR. ORDER These assessees have filed their instant appeals involving different assessment year(s) against the respective Commissioner of Income-tax (Appeals) separate order(s) affirming the Assessing Officer(s) identical action treating varying sums of Long Term Capital Gains (LTCG) / Long/Short Term Capital Loss (LTCL); as the case may be as involving unexplained cash credits u/s 68, involving proceedings u/s 143(3) of the Income Tax Act, 1961; in short 'the Act'. 2. I have heard these appeal(s) together of the fact that the sole identical issue raised in the instant entire batch is that of genuineness of assessees' LTCG/LTCL, as the case may be, derived from sale of shares held in various scrips. It is in this identical backdrop that I am treating ITA No.258Kol/2019 in case of Rahul Goenka vs. ITO Wd-47(1), Kolkata for assessment year 2014-15 as the "lead" case. 3. Both the learned representative(s) take me to CIT(A)'s detailed discussion whilst treating the impugned STCL pre-arranged bogus loss in the instant "lead" case vide the following lower appellate discussion:- "I have considered the submission of the appella....
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....market prices and the same supported by time stamped contract notes. The deliveries were received and given through depository account and the payments were made through banking channels. All the transactions are duly supported by credible evidences in no defect has been found in such documents the facts that all transactions were carried out through portal of recognized stock exchange and payments made through banking channels does not indicate genuineness and only reflects proper paper work or documents. What is importance is whether the fluctuation of price of the companies are supported by the performance and financial fundamentals. It appears that most of these companies have hardly any business activities. On perusal of the share price of these companies over a period of 5 years, it is revealed that the graph assumes the shape of bells indicating rapid rise and fall in the shares of both the companies M/s Unno Industries and M/s Lumitech. The share price of both companies were examined and it is revealed that the share price had declined rapidly after reaching a peak for a short period. The share prices of the both companies are analyised as follows: There is evidenc....
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..... CIR/CFD/CMD/12/2015 dated November 30, 2015 issued by Securities and Exchange Board of India (SEBI) with respect to Standard Operating Procedure (SOP) for suspension and revocation of equity shares of listed entities for non-compliance with provisions of SEBI Listing Regulations, 2015, Trading members are requested to note that the following will be effected; (1) Trading in securities of the undermentioned companies will be suspended w.e.f. May 26,2016 (being 21 days from issue of this notice); on account of non-compliance with Regulation 33 of SEBI Listing Regulations; 2015 for two consecutive quarters i.e., September 2015 and December 2015 (2) Sr. No. Scrip Code Company name 1 517496 Ricoh India Ltd. 2 519273 Unno Industries Ltd.* 3 513937 Beckons Industries Ltd. 4 590063 Duncans Industries Ltd. "This company is presently suspended due to Surveillance Measures wef March, 31,2016 vide provisions of. Exchange Notice: 110. 2016032-8'-15* dated March, 28,2016. The following company has submitted- Financial Results-under Regulation 33 of SEBI Listing Regulations, 2015 for two consecutive quarters i.e, Septem....
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....t the share prices were rigged for ulterior purposes. These suspicions had been confirmed by the report of Investigation Wing and the report of the SEBI which as pointed out by the AO had suspended trading in these two shares. The divergent range in price fluctuation of both shares raises doubts about the genuineness of transactions in these shares which appears to be bogus. After careful consideration of the submission of the appellant, the relevant assessment records, and the data of share prices of M/s Unno Industries Limited and M/s Luminaire Technologies as traded in BSE, it has to be held that the abnormal appreciation of share price which is not supported by any financial fundamentals is nothing but a colourable device for the avoidance of taxes. The appellant has indulged in chicanery and manipulation to launder his undisclosed income through a series of bogus transactions. The addition of Rs.6,50475/- as unexplained cash credit u/s. 68 is sustained. The appeal on these grounds fails and is therefore dismissed. The AO is directed accordingly. 5 In the result, the appeal is dismissed." 4. I have given my thoughtful consideration to rival contentions. Lea....
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.... of the Act. The evidence produced by the assessee in support of the genuineness of the transaction was rejected. 3. The assessee carried the matter in appeal and the ld. CIT(A), Kolkata, had upheld the addition. The ld. CIT(A) has in his order relied upon "circumstantial evidence" and "human probabilities" to uphold the findings of the AO. He also relied on the so called "rules of suspicious transaction". No direct material was found to controvert the evidence filed by the assessee, in support of the genuineness of the transactions. In other words, the overwhelming evidence filed by the assessee remains unchallenged and uncontroverted. The entire conclusions drawn by the revenue authorities, are based on a common report of the Director of Investigation, Kolkata, which was general in nature and not specific to any assessee. The assessee was not confronted with any statement or material alleged to be the basis of the report of the Investigation Wing of the department and which were the basis on which conclusion were drawn against the assessee. Copy of the report was also not given. 4. The ld. D/R, submitted that the transaction was not genuine. He argued that the e....
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....e the lower authorities by the assessee, the ITAT rejected these arguments. In the case on hand, all evidences were produced by the assessee. In the case of Sanjay Bimalchand Jain, legal heir of Santi Devi Bimalchand Jain, the Hon'ble High Court upheld the stand of the Revenue that the transaction in question is an adventure in nature of trade and the profit of the transactions is assessable under the head of 'Business Income'. In the case on hand, the ld. Assessing Officer has not assessed this amount as 'Business Income'. In any event, I am bound to follow the judgment of the Jurisdictional High Court in this matter. I find that the assessee has filed all necessary evidences in support of the transactions. Some of these evidences are (a) evidence of purchase of shares, (b) evidence of payment for purchase of shares made by way of account payee cheque, copy of bank statements, (c) copy of balance sheet disclosing investments, (d) copy of demat statement reflecting purchase, (e) copy of merger order passed by the High Court , (f) copy of allotment of shares on merger, (g) evidence of sale of shares through the stock exchange, (h) copy of demat statement showing the sale of shares, ....