2023 (10) TMI 1228

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....ssee has filed this appeal. 2. Heard the learned Representatives of both sides at length and case records perused. 3. The facts leading to this appeal are such that the AO received an information from DDIT(Inv.)-Unit 8(2), Mumbai which showed that the assessee had done transactions in the shares of M/s Banas Finance Ltd. ["Banas"]. The AO further observed from report that the shares of 'Banas' had been used to facilitate arrangement of bogus capital gain or loss to beneficiaries. Based thereon, the AO made up his mind that the assessee has also taken advantage resulting into escapement of income from assessment. Accordingly, the AO issued notice u/s 148 on 29.03.2019 for proceeding u/s 147. In response, the assessee filed return of income....

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....oss to beneficiaries. He also noted that taking note of such incidents, the Income-tax department has conducted searches/surveys/enquiries on various brokers/companies and found that they were arranging bogus gain or loss. Ultimately, in Para No. 18, the AO doubted the purchase and sale of shares by assessee and thereby did not accept the short-term loss suffered by assessee as genuine and made addition. Ld. AO also relied upon following judicial rulings: (a) CIT Vs. Durga Prasad More 214 ITR 801 (SC) (b) Hersh Win Chadha Vs. DCIT, ITA No. 3088 to 3098 & 3107/Del/2005 (c) Sumati Dayal Vs. CIT 1995 AIR 2009 (SC) (d) McDowell & Co. Ltd. Vs. CTO 1986 AIR 649 (SC) (e) Sanjay Bimal Chand Jain Vs. PCIT, Nagpur (Bombay HC) (f) M.K....

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....ereof, respondent's case was reopened under Section 148 of the Act. 4. The A.O. did not accept respondent's claim of long term capital gain and added the same in respondent's income under Section 68 of the Act. While allowing the appeal filed by respondent, the CIT[A] deleted the addition made under Section 68 of the Act. The CIT[A] has observed that the A.O. himself has stated that SEBI had conducted independent enquiry in the case of the said broker and in the scrip of RFL through whom respondent had made the said transaction and it was conclusively proved that it was the said broker who had inflated the price of the said scrip in RFL. The CIT[A] also did not find anything wrong in respondent doing only one transaction with the said br....

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....ubmitted that the present case of assessee is fully covered by this decision on facts and in law. To demonstrate this, Ld. AR pointed out following facts relating to the case of assessee from the documents placed in the Paper-Book filed by assessee: (a) The shares were purchased through broker M/s Exclusive Securities Ltd. on the floor of Bombay Stock Exchange on 06.03.2012 (Copy of Contract-Note at Page No. 15 of Paper-Book). The assessee has paid Service-tax, Stamp duty and STT on purchase. (b) The shares were sold through broker M/s Exclusive Securities Ltd. on the floor of Bombay Stock Exchange on 23.03.2012 (Copy of Contract-Note at Page No. 16 of Paper-Book). The assessee has paid Service-tax, Stamp duty and STT on sale. (c) ....