TaxTMI 
TaxTMI 
2023 (8) TMI 1595
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....hree reasons: (a) Substantial increase in capital (Reason Code BL01. 02), (b) Large value sale of futures (derivatives) in recognized stock exchange reported in Securities Transaction Tax Return STT code 06 (Reason Code TX08.02), (c) Low capital gains with respect to sales consideration, i.e. whether capital gain or loss is genuine and has been correctly shown in the return of income (Reason Code CG01.05). 2.1. Ld. AO issued statutory notices u/s. 143(2) and 142(1) of the Act, which were served on the assessee. Ld. AO observed that there has been persistent, continuous, systematic and calculated non-compliance or belated compliance by which assessee had dragged the proceedings to the fag-end of the assessment year, such that requisite enquiry/investigation into the affairs of the assessee on the above three noted issues would be either delayed or scuttled. Ld. AO had made additions to the tune of Rs. 16,21,89,184/- on account of the following: a) Addition on account of transfer entries in the personal capital account for unsubstantiated increase in capital as unexplained cash credit u/s. 68 of the Act - Rs. 13,42,97,642/- b) Addition on account of Long Term Capital Gai....
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....ries claimed to be introduced as capital from individual Balance Sheet into proprietorship Balance Sheet and the source of funds used for the same. Ld. AO thus held that since assessee has not been able to explain the credit in his books of accounts as regards this increase in capital brought in, added it to the total income as it remained unsubstantiated. 4. On the second issue of addition in respect of LTCG and STCG totalling to Rs. 2,58,69,249/-, Ld. AO noted that assessee has claimed an amount of Rs. 2,45,80,798/- as per schedule EI of his return as exempt income u/s. 10(38) of the Act towards LTCG. To examine the genuineness of claim of LTCG, Ld. AO called for details of shares of RSWM Ltd. on which this LTCG was claimed as exempt. From the DMAT account furnished by the assessee, Ld. AO noted certain discrepancies in respect of the opening balance of shareholding and thus concluded that the claim of exemption is untenable in law. Similar view was taken in respect of STCG of Rs. 12,88,451/-. 5. In respect of the third issue relating to disallowance of loss on account of trading of commodities (F&O) amounting to Rs. 20,22,293/-, for which the assessee is before the Tribunal by....
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....0K Appellant is a director of the company 1,59,70,000/ 2013-14 31/03/2016 3. Bonaza Commodity Brokers Pvt. Ltd/Bonanza Portfolio Ltd 4353-4C Madan Mohan Street Ansari Road, Daryaganj New Delhi-110002 PAN:AACCB1987C/ AAACB0764B None, Stock broker of the appellant 1,51,354/ 2014-15 31/03/2016 4. Pradeep More Old Srimanta Shankar Road, Haibargaon, Nagaon-782002 PAN: NOT AVAILABLE None 15,00,000/ 2007-08 31/03/2016 5. Share of image insurance Pvt. Ltd. 13 Community Center, East of Kailash, New Delhi-65 None 16,72,455/ 2015-16 31/03/2016 6. Gautam Bhansali C/o H M Traders, Tura the Appellant Bazar, TURA-794001 PAN: AFUPB8995A Nephew of the appellant 7,00,000/ 2012-13 (18/10/2012 31/03/2016 7. Global School 416. Dreamland Building 1/18B, Asaf ali Road, New Delhi-2 Prop. Concern of the Appellant 1,43,09,409/ Prior to 2015-16 (Opening Balance 2430 9409.24) 31/03/2016 8. Liza Bhansali Srinangar Path, GS Road, Guwahati-781005 PAN: AJDPB4264B Daughter of the Appellant 1,73,44,727/ Prior to 2015-16 (Opening Balance 1694 4727.12) 31/03/2016 9. Pannalal Bhansali & Sons (HUF), Srinagar, GS Road, CHY Guwahati-781005 PAN: AAHHP2822G Appellant is the....
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....e. 7. Ld. CIT DR has placed on record a detailed written submission for each of the grounds. Ld. CIT DR submitted that while deleting the addition, Ld. CIT(A) has made a remark that in case, any of the documentary evidence filed by the assessee during the course of appellate proceedings are found to be incorrect or false or fabricated then, assessee would be liable for requisite action under law for wrong verification and also for wilful attempt to evade taxes. According to him, this remark is important in the backdrop of the observation made by Ld. CIT(A) that the addition was made by the AO since assessee could not satisfactorily explain/ substantiate to build- up his capital. All this had been explained only during the course of appellate proceeding, by filing documentary evidence. Ld. CIT DR stated that assessee had submitted additional evidence before the Ld. CIT(A) which were never submitted in the course of assessment proceeding before the Ld. AO. By whatever submitted before the Ld. AO, substantial increase in the capital of the assessee could not be explained which resulted into the addition. In the first appellate proceeding, no remand report was called for by the Ld. CI....
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....the Ld. AO. 8.3. When we further delved into other items of capital in the table extracted above, we find that there are transactions by the assessee with his daughter Smt. Liza Bhansali, there are transactions with spouse of the assessee, Smt. Santosh Bhansali, also with his another proprietary concern named as Global School. Further, there is a transaction with nephew of the assessee, Shri Gautam Bhansali and there are another transactions with PLB Finance & Services Pvt. Ltd. wherein again, assessee is the director. The nature of these transactions with the aforesaid related parties in most of the cases, have been explained to be gifts, without substantiating the source of the same. 8.4. One of the items relates to dividend from RSWM amounting to Rs. 1,03,830/- which forms part of increase in the capital. Assessee has claimed that the transaction of shares of RSWM Ltd. is correctly reflected in the account of his HUF i.e. Pannalal Bhansali & Sons (HUF) of which assessee is the Karta. In one hand, assessee is claiming that the transaction of shares of RSWM Ltd. is on account of HUF and on the other hand, it is claiming the amount of dividend from the same shares, for passing en....
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....CG and STCG on share transaction, Ld. AO had called for all the relevant documentary evidence and explanation which were partially complied with. Ld. CIT(A) had given the relief in respect of this addition by holding that addition was made relying on wrong DMAT account i.e. of the HUF of the assessee and not of the assessee himself. While granting relief by holding so, Ld. CIT(A) made a remark that in case, if this documentary evidence filed by the assessee during the course of appellate proceeding is found to be incorrect or false or fabricated, then the assessee would be liable for requisite action under law for wrong verification and also for wilful attempt to evade taxes. This remark by the Ld. CIT(A) itself demonstrates a doubt and a double mind while granting the relief. 9.1. It is important to note that the details and documents were furnished by the assessee for the first time before the Ld. CIT(A) who has claimed to call for these documents by exercising his powers u/s. 250(4) of the Act. From perusal of the documentary evidence placed on record in the paper book, it is not discernible if the account is of the HUF or the individual and, therefore, it is difficult to appre....