TaxTMI 
TaxTMI 
2015 (9) TMI 1747
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....are from same family and since the issues urged before us by them are identical in nature, these appeals were heard together and are being disposed of by this common order, for the sake of convenience. 3. The facts relating to the issues are stated in brief. The revenue carried our search and seizure operations in the hands of Shri Mukesh Choksi and his group of his companies. During the course of search, it came to light that they were indulging in providing bogus accommodation bills in order to enable assessees to generate bogus long term capital gains on sale of shares. The Investigation wing gathered details of the persons who had transacted with Mukesh Choksi and his group of companies. It was noticed that the assessees herein had a....
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....ount assessed by the AO is given below:- (a) Shri Devendra Dayabhai Shah L/R of Subhadra Shah -- 6,21,392 (b) Shri Devendra Dayabhai Shah -- 6,12,692 (c) Shri Devendra Surendra Shah -- 5,58,428 5. Before Ld CIT(A), the assessees questioned validity of reopening of assessment. The first appellate authority noticed that the returns of income filed by these assessees u/s 139(1) had been processed and the AO had reopened assessment on the basis of valid information received. Hence the Ld CIT(A) upheld the validity of reopening. With regard to the additions made, the Ld CIT(A) upheld the same with the following reasoning:- (a) Shri Mukesh Chokshi has admitted to have received cash towards sale of shares to the assessees. Whe....
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....e the AO, he has admitted that he had received cash from these assessees for the shares sold to them. Since M/s Alliance Intermediateries Network Pvt Ltd happened to the dealer of M/s Inter connected stock exchange of India Ltd, the AO wrote a letter to the above said stock exchange. But the stock exchange replied that their record did not contain the relevant trade transaction. Hence the AO took the view that the purchases are bogus. We are unable to agree with the view expressed by the tax authorities. The assessee has produced evidences for purchase of shares. The assessees are having relationship with M/s Alliance Intermediateries & Network Pvt Ltd only with regard to the purchases, i.e., they do not have direct relationship with M/s In....
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.... of transaction summary evidencing delivery of shares. However, the Ld CIT(A) has held that the proof of delivery of shares are not sufficient to prove genuineness of sales, when the purchases were found to be not genuine. We are unable to understand the said reasoning given by the Ld CIT(A). If the tax authorities require any other evidence, apart from the evidences furnished by the assessees, they could have asked the assessees to furnish the same. Instead, they have proceeded to assess the long term capital as income under the head income from other sources. In our view, the said action of the tax authorities is not justified. There should not be any dispute that the delivery of shares could not have been done without purchasing them. ....