TaxTMI 
TaxTMI 
2023 (6) TMI 1116
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....the assessee has sold these shares of M/s. PFL and received sale consideration of Rs.24,67,900/- has made an addition of Rs.24,67,900/- & commission of Rs.49,358/- to the total income. 4. Aggrieved, assessee preferred an appeal before the Ld. CIT(A) who was pleased to dismiss the same. Aggrieved by the action of the Ld. CIT(A), the assessee is before us. 5. We have heard both the parties and perused the records. We note that the assessee had filed her return of income declaring loss of Rs.1,88,350/- for AY. 2012-13 on 30.03.2014 which was later re-opened by AO u/s 147 of the Act on 30.03.2019 on the basis that he received an information from the DDIT Investigation that assessee has dealt with purchase and sale of shares of M/s. PFL which earned her bogus Long Term Capital Gain (LTCG) on sale consideration received to the tune of Rs.24,67,900/-. According to AO, the assessee has brought 10,000 shares at the cost of each share at Rs.20.32 i.e. total Rs.2,03,008/- and sold it for Rs.24,67,900/- and claimed capital gain of Rs.22,64,192/-. According to AO, he brought to the notice of assessee through show cause notice about the proposed action of treating the share of M/s. PFL as penn....
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....llowing documents as under: - Sr. No. Description Annexure Page No. 1 Copy of the purchase contract note of the appellant as on 30.12.2009 "Annexure A" 49-51 - Appeal Set 2 Copies of the contract notes of the appellant as on 20.04.2011, 21.04.2011, 25.04.2011 and 28.04.2011 "Annexure B colly" 52-63 - Appeal Set 3 Copy of the bank statement in which the appellant had received the amount "Annexure C" 64-66 - Appeal Set 7. It is further noted that assessee had received the sale consideration through banking channel. And it has been brought to my notice that similar addition made by the Department in respect of LTCG claim while trading in share of M/s. PFL Infotech has been considered and this Tribunal has upheld the claim of the LTCG (Refer Chennai Bench decision of this Tribunal in the case of Sohanraj Uttamchand, Chennai Vs. DCIT (ITA. No.1787/Chny/2017 for AY. 2014-15 order dated 28.02.2018) wherein it was held as under: - In the case of the assessee, the genuineness of the company M/s. PFL Infotech Ltd which is a third party and not under the control of the assessee and whose shares assessee had purchased and sold is the issue. Moreover, the purchase and sales o....
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....es may raise due to certain hidden factors which may be not known to the public at large even with respect to blue chip companies. Hence conclusion cannot be bluntly made on the basis of surmises and conjectures in the case of any assessee when certain other material factors are in favour of the assessee. 8.6. The Hon'ble Punjab & Haryana High Court in the case CIT vs. Anupam Kapoor reported in 299 ITR 179 in a somewhat similar situation has categorically stated that no presumption could be drawn by the Assessing Officer merely on surmises and conjectures. The gist of the decision and case is extracted herein below for reference: - "The assessee's case was reopened on receipt of an intimation from the Deputy Director of Income-tax (Investigation) stating that the long-term capital gain declared by the assessee was false and the transaction was not genuine. In response to a notice under section 148 of the Income-tax Act, 1961, the assessee submitted his reply and furnished evidence in support of his claim of long-term capital gain. The Assessing Officer held that the assessee failed to lead evidence to support his claim of long-term capital gain and considered the amount of Rs.1....
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.... 8.8 In the case Umacharan Shaw & Brothers vs. CIT reported in 37 ITR 271, the Hon'ble Apex Court held that where conclusion arrived at was due to suspicion which could not take the place of proof but based on many surmises and conjectures reliance cannot be placed. 8.9. Similar ratio was laid down by the Hon'ble Apex Court in the case Lalchand Bhagat Ambica Ram vs. CIT reported in 37 ITR 288 (SC). 8.10 In the case CIT vs. Carbo Industrial Holdings Ltd., reported in 224 ITR 422, the Hon'ble Calcutta High Court has held that when purchase and sale of shares are effected through share brokers, their particulars are furnished and the payment is made by account payee cheque the transaction cannot be doubted just because the brokers fail to appear before the Revenue even after issue of summons. Similar view was upheld by the Hon'ble Calcutta High Court in the case CIT vs. Emerald Commercial Ltd. & another reported in 250 ITR 539. 8.11 In the case CIT vs. Prem Pal Gandhi, the Hon'ble Punjab & Haryana High Court held vide its recent order dated 18.01.2018 has held that:- "the fact that the appreciation in the value of the shares is high does not justify the transactions being tr....