TaxTMI 
TaxTMI 
TaxTMI 
2023 (10) TMI 390
X X X X Extracts X X X X
X X X X Extracts X X X X
....before the Tribunal is late by 14 days. For which the assessee has filed delay condonation application. After going through the application, and hearing both the sides, I find that in the interest of substantial justice, a small delay of 14 days caused in the filing of the appeal before the Tribunal deserves to be condoned, and I hold so. I shall now proceed to adjudicate the appeal of the assessee. 3. In the appeal, the assessee has raised the following grounds: "1. The Ld. CIT (A) NFAC, Delhi was grievously erred in confirming the addition of Rs. 15,61,447/- on account of stating that the data received from NSE, the appellant has evaded the tax which is patently wrong and not justifiable. The appellant submits that the Ld. A. O. cou....
X X X X Extracts X X X X
X X X X Extracts X X X X
....) ought to have confirmed that notice u/s. 148 was invalid and without jurisdiction. 1.3 The Ld. CIT(A) has failed to appreciate that the conditions precedent for valid reopening of the concluded assessment were not satisfied, more particularly the "reason to believe". Ld. counsel for the assessee pleaded that being a legal ground the adjudication of which requires no fresh facts to be gone into, the same should be admitted for adjudication. He placed reliance on the following decisions of the Hon'ble Apex Court: i) Jute Corporation of India Vs. CIT, 187 ITR 688 ii) National Thermal Power Co. Ltd. Vs. CIT, 229 ITR 383. However, the ld. DR objected to admission of the additional ground. 6. Heard both the parties; I am of the vie....
X X X X Extracts X X X X
X X X X Extracts X X X X
....see contended that the reasons did not reveal source of the information; the scrip, on the trading of which client modification code was resorted to, and also role and status of the said Gold Mine Stocks P. Ltd. in the same. He, therefore, contended that it was not clear from the reasons as to what was the specific information or material which formed the basis for the AO to be satisfied that income of the assessee had escaped the assessment. Further, he contended that since the reasons did not reveal the exact scrip in whose trading CCM was resorted to, the AO could not have possibly verified this information from the records; that he could not have and did not even attempt to verify, whether the information in his possession matched with ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....his office on 1 1.02.2016. Modification of the client codes is a practice under which brokers change the client codes in sale and purchase orders of securities after the trades are conducted. While it is legally permitted to rectify inadvertent errors in punching the orders, there were concerns that such modifications could be misused for manipulative activities in the market. SEBI conducted a probe into 'Modification of client codes' by brokers, pursuant to observation by the Finance Ministry about many such modifications taking place in derivatives transactions at the National Stock Exchange during March 2010. After analysis of data received from national stock exchange and the findings during the survey, the ADIT concluded that....
X X X X Extracts X X X X
X X X X Extracts X X X X
....application of mind by the AO, relying merely on the information available with him. This information, I have noted, neither reveals the material nor the source from where it came, nor it specifies scrip on which CCM was resorted to by the assessee to earn loss. In the absence of the specific information available with the AO, there was no scope for the AO to apply his mind on it independently, and check the information available with him so as to arrive at his own satisfaction of the income of the assessee being escaped the assessment. Therefore, I am in complete agreement with the ld. counsel for the assessee that the jurisdiction assumed by the AO to reopen the case of the assessee is de hors the satisfaction of the AO of any income of t....
X X X X Extracts X X X X
X X X X Extracts X X X X
....lied to the assessee, with the original being held back by the AO, will not suffice to fulfill this mandatory requirement of law. For this reason, I reject the arguments of the ld. DR. In view of the above, the additional ground raised by the assessee is allowed. Since the assessment order passed in the present has been quashed by us the ground raised on merits requires no adjudication being a mere academic exercise. However I shall still adjudicate the ground raised on merits also challenging the addition made on account of alleged shifting out of profits by resorting to CCM. 14. I find that throughout the re-assessment proceedings, and even in the appellate proceedings, the assessee was never confronted with the information with the AO....