TaxTMI 
TaxTMI 
2023 (3) TMI 1560
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....t there was abnormal rise in the price of shares of scrip Wagend Infra venture Ltd., which against the human probability in view of the fact that the company was neither making any profit nor declared dividend." 3. "On the fact and circumstances of the case, the Learned CIT(A) has erred in deleting the addition of Rs. 4,33,71,4681- made by the AO on account of unexplained cash credit u/s. 68 of the I. Act, 1961 without appreciating the fact that the Hon'ble Supreme Court in the case Sumati Dayal Vs CIT (1995) 214 ITR 801 (SC) has held genuineness could validity be tested on the ground or principle of preponderance of human possibilities which form a valid ground or parameter for determining the genuineness." 2. The brief facts of the case are that the assessee is an individual and derives income from capital gains and income from other sources. The assessee has filed the return of income for the A.Y 2013-14 on 16.09.2014 with a total income of Rs. 1,08,070/-.The return of income was processed u/s 143(1) of the Act. The search operations U/sec132 of the Act conducted at the residential premises of the assessee as he is engaged in obtaining bogus long term capit....
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....2-13 liquidated his investment and the long term capital gain of Rs. 4.33. 71,468/- accrued to him. Copies of statement of demat account operated and maintained by the assessee share brokers evidencing the sale are also enclosed /or your kind perusal. Following are being claimed to be direct Copies of ledger account of the share brokers evidencing payment of STT on the sale, bank statements evidencing receipt of sale consideration as well as computation of long term capital gain have already been furnished yet the same are being enclosed again. From the above stated facts it is evident that complete details verification of claim of Long Term Capital Gain by the assessee have been furnished. The assessee has been issued and served a show cause notice whereby he has been asked to explain as to why the Long Term Capital Gain accrued to him shall not be treated as undisclosed income and taxed as cash credit under Section 68 of the Act. The stated show cause notice has been issued alleging that the claim of Long Term Capital Gain of the assessee is not simple or lucid and your good self are in possession of certain circumstantial direct as well as direct evide....
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.... of verification due to increasing cases of non-genuine claim of exemption these days. However, it is most humbly clarified that the company M/s. Wagend Infra Ventures Limited is not a penny stock company and has not been found or held to be so. Thus, drawing adverse cognizance only upon the basis of suspicion is against the principles of natural justice and law and thus, it is most humbly requested that no adverse cognizance may be drawn in this regard. 2. Your goodself in Para 2.4 (ii) has stated that the result of enquiry was also shared with SEBI and SEBI after investigating some of the cases have found the allegation to be correct. In this regard it is most humbly submitted that recently certain restrictions were imposed by SEBI and stock exchanges on transactions in shares of 331 companies which were found and alleged to be indulged in the stated pernicious practice of generating bogus Long Term Capital Gain. A copy of the list of said entities is enclosed for your kind perusal. From the perusal of the stated list it is evident that even from the part of SEBI and stock exchange there has been no allegation in respect of the shares of M/s Wa....
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....regard it is clarified that no evidence of any cash transaction has been found or seized from the assessee even after the conduct of extensive search action at his premises. The importance of incriminating material found during the course of search has been referred to by several courts in several judicial pronouncements. Relevant extract of one of such judicial pronouncements of Hon'ble Delhi High Court in the case of CIT vs Kabul (2016) 380 ITR 573 (HC)(Delhi) is reproduced hereunder:- "37. On a conspectus of Section 153A(1) of the Act, read with the provisos thereto, and in the light of the law explained in the aforementioned decisions, the legal position that emerges is as under: i. Once a search takes place under Section 132 of the Act, notice under Section 153 A (1) will have to be mandatorily issued to the person searched requiring him to file returns for six A Vs immediately preceding the previous year relevant to the A Yin which the search takes place. ii. Assessments and reassessments pending on the date of the search shall abate. The total income for such AYs will have to be computed by the AOs as afresh exercise. iii. The....
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....s Ltd vs DCIT, 2012-TIOL-391- ITAT-MUM-SB b) ACIT vs. M/s Pratibha Industries Ltd, ITA No. 2197 to 2199/Mum/2008 c) CIT vs Gurinder Singh Bawa (2016) 386 ITR 483 (HC)(Bom) d) Pr. CIT vs MS. Lata Jain, (2016) 384 ITR 0543 (HC)(Del) e) Pr. CIT vs Saumya Construction Pvt Ltd. (2016) 387 ITR 0529 (HC)(Gui) f) Sanjay Aggarwal vs. DCIT, ITA No.84/Del/2013 g) ACIT vs. Manoj Narain Aggarwal, ITAN No. 5518/Del/2012 h) Jakson Engineering Ltd. vs. ACIT, 2014-TIOL-l94-ITAT-DEL i) ACIT vs. PACL India Ltd, 2013-TIOL-734-ITAT-DEL Though it is understood that all these judicial pronouncements cited above are related to the assessment proceedings which have abated as a consequence of search and could easily be distinguished yet these are being referred to take cognizance and moot of the judiciary on the importance of incriminating. material found during the course of search action. It is not out of place to mention here that in some of the judicial pronouncements the search action have been referred to as the final action taken by the department to find out the truth and facts of an assessee. In the c....
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....ee has filed an appeal before the CIT(A), whereas the appellate authority on the first disputed issue in respect of validity of assessement u/s 143(3) r.w.s 153A of the Act has observed that there is no violation in the procedures or law in completing the assessment proceedings and dismissed the assessee's ground of appeal. On the second disputed issue with respect to the additions u/s 68 of the Act in ground No. 2 to 5 of the grounds of appeal, the CIT(A) has dealt elaborately on investment pattern, submissions, material information, judicial decisions and for the same assessment year in the assessee's father case the long term capital gains on the sale of shares of M/s Wagent Infra Venture was accepted by the department. Finally Ltd.CIT(A) has also relied on the Hon'ble High Court and Hon'ble Tribunal decisions and followed the judicial precedents and observed that the action of the AO is not tenable and allowed these grounds of appeal by deleting the addition and partly allowed the assessee appeal. Aggrieved by the order of the CIT(A), the revenue has filed an appeal before the Hon'ble Tribunal. 5. At the time of hearing, the Ld.DR submitted that the CIT(A) has erred ....
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....ing sale value of Rs. 4,53,51,446/- and after claiming deduction of the cost of acquisition, the Long Capital gains of Rs. 4,33,71,468/- was claimed exempted u/s 10(38) of the Act. Whereas the CIT(A) has dealt on the first issue and confirmed the validity of the assessment. Further on the merits of the case, the Ld. AR submitted that the CIT(A) has considered the factual aspects that the AO has relied on the statement of third party and made the addition based on the statement u/s 132(4) of the Act of Mr. Rajkumar Kedia mentioning that the assessee was involved in providing accommodation entries and no such statement was confronted to the assessee and opportunity of cross examination was provided to the assessee. Further not providing an opportunity to cross examination and statement is violation of principles of natural justice. The assessee has substantiated before the AO with the documents with respect to allotment of shares of M/s Wagend Infra Venture Pvt Ltd (formerly known as M/s Agarwal Holdings Ltd) referred to page 31 to 33 of the paper book. The assessee has filed the details, evidences on the disputed issue before the AO in lieu of the notice issued u/s 142(1) of the Act....
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.... exemption of long term capital gains on shares and referred to page 9 to 13 of the paper book. 9. Whereas the AO has issued show cause notice and the assessee has filed the details substantiating the claim and the transaction of the assessee are not in the nature of speculation and the assessee has purchased the scrip for a long term holding. The Ld.AR emphasized that the assessee has discharged the burden by submitting the details where the payments and receipts are through banking channel and the identity, genuineness of the transaction and creditworthiness have been proved. The assessee has made elaborate submissions before the CIT(A) along with evidences, facts and judicial decisions. The Ld. AR further submitted that the CIT(A) has considered the factual aspects and information satisfying the three ingredients u/s 68 of the Act and the assessee has discharged his burden by submitting the details, but the AO has not made any independent enquiry or conducted any inspection of facts and only relied heavily on the statement recorded. Whereas the assessee has purchased the shares in the normal course of business and claimed exemption u/s 10(38) of the Act. We found that t....
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....edings stated that the essential feature of availing Bogus Capital Gain is settlement of transaction in cash. However, no evidence substantiating the same was found even after conducting the extensive search action in the case of the appellant and the judgement of Hon'ble High Court of Delhi in the case of CIT vs. Kabul Chawla (2016) 380 ITR 573 (HC)(Delhi) was relied upon. 2. Ground No. 3 - Additions made on surmises despite the fact that the features of bogus capital gain seekers were distinguishable from the facts of the case of the appellant a) A comparative chart showing difference between the modus operandi adopted by the bogus capital gain seekers as narrated in the assessment order and that of appellant is as under:- or relation with an assessee. appellant because the father of the I appellant was an old shareholder of the stated company. 2 The purported investors are returned No evidence substantiating the same their initial investment amount in was found or ever brought on record in cash. the case of the appellant. 3 The transaction of sale is settled by Neither evidence of any such cash providing unaccounted cash which is ....
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.... That we have further relying upon the following judgments wherein it has been held that unless and until the Assessing Officer has not received / possessed any adverse material against the appellant, no additions if any could be made only on the basis of general information received / collected from the CIT(A)-49/IT-177/2017-18 Investigation Wing of the Deptt., as such the legitimate and bonafide claim, cannot further be disallowed, only on the basis of presumption and guess work if any attributed in the course of assessment proceedings:- i. Pr. CIT vs. Prem Pal Gandhi, (2018) 401 ITR 0253 (P&H) ii Pr. CIT v/s. Hitesh Gandhi, ITA No. 18 of 2017(0 & M) iii. Farrah Marker Vs. ITO (2016) 46 CCH 0535 (Mum Tribunal) iv. Sh. Prakash Chand Bhutoria vs. ITO, ITA No. 2394/Ko1/2017 v. DCIT vs. Sunita Khemka, LTA Nos. 714 to 718/Ko1/2011 vi. Principal CIT v/s. Prempal Gandhi, ITA-95-2017(0& M) vii. ITO 24(3)(1) v/s, M/s. Indravadan Jain HUF ITA - 4861/Mum/2014 ACIT 24 (3) v/s. Shri Indravan Jain ITA No. 5168/Mum/2014 viii. Smt. Durgadevi Mundra v/s ITO 21(1)(1) ITA No. 1175/Mum/2012 ix. Shri. Mahe....
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....eating the sale consideration received as unexplained cash credit merely on the basis of the suspicion cannot be made in view of the overwhelming evidences provided by the assessee. While it is true that the AO should look into the surrounding circumstances to find out the reality, the AO should have reasons to believe that the apparent is not the real. In this case, the assessee has provided all the evidences. The AO has not brought anything contrary on record to prove the assessee wrong. He heavily relied upon the assessment order. Even though the AO stated that Rajkumar Kedia mentioned the assessee as an entry operator, there is no such reference to the assessee in his statement. Even in the search, no contrary evidences could be detected. In view of the above, the addition made by the AO cannot be upheld. 7.3 The AO has heavily relied upon the statement of Shri Rajkumar Kedia and Shri Pravin Agarwal. It was stated by the AO that Shri Rajkumar Kedia has said that the appellant was a well-known entry operator of Mumbai. However, extract of the statement which is a part of the assessment order, do not mention the name of the assessee anywhere. This, again, ....
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....ted, there was no material with the Department on the basis of which it could justify its action, as the statement of the aforesaid two witnesses was the only basis of issuing the Show Cause Notice. We, thus, set aside the impugned order as passed by the Tribunal and allow this appeal. H.R. Mehta vs. ACIT, (2016) 289 CTR 561(Bom)(HC) In our view in the light of the fact that the monies were advanced apparently by the account payee cheque and was repaid vide account payee cheque the least that the revenue should have done was to grant an opportunity to the assessee to meet the case against him by providing the material sought to be used against assessee in arriving before passing the order of reassessment. This not having been done, the denial of such opportunity goes to root of the matter and strikes at the very foundation of the reassessment and therefore renders the orders passed by the CIT(A) and the Tribunal vulnerable. In our view the assessee was bound to be provided with the material used against him apart from being permitting him to cross examine the deponents. Despite the request dated 15th February, 1996 seeking an opportunity to cross examine the deponent and f....
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....ed with the return of income of assessment years 2004-05 and the current year under consideration. In this factual and legal matrix of the case, as discussed above, we find that the addition of Rs.95,12181211- -/s. 68 of the Act made by the authorities below to be unsustainable and therefore direct the AO to delete the said addition and accept the LTCG income of Rs.93,00,012/- shown as exempt u/s. 10(38) of the Act. Consequently, ground No. 1 of the assessee's appeal is allowed." 7 5 The Hon'ble ITAT, Kolkata in the case of Mr. Navneet Agarwal ITA No. 228/Ko1/2017 held as under: "11. The assessee in this case has stated the following facts and produced the following documents as evidences: 1. The assessee had made an application for allotment of 50000 equity shares of "Smart champs IT and Infra Ltd." and she was allotted the share on 3rd December 2011 (copy of Application form, intimation of allotment and share certificate Paper Book at page 8 to 10). 2. The payment for the allotment of shares was made through an account payee cheque (copy of the bank statement evidencing the source of money and payment made to "Smart Champs IT & Infra Lt....
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....tax. All these observations are general in nature and are applied across the board to all the 60,000 or more assessees who fall in this category. Specific evidences produced by the assessee are not controverted by the revenue authorities. No evidence collected from third parties is confronted to the assesses. No opportunity of cross-examination of persons; on whose statements the revenue relies to make the addition, is provided to the assessee. The addition is made based on a report from the investigation wing. 13. The issue for consideration before us is whether, in such cases, the legal evidence produced by the assessee has to guide our decision in the matter or the general observations based on statements, probabilities, human behavior and discovery of the modus operandi adopted in earning alleged bogus LTCG and STCG, that have surfaced during investigations, should guide the authorities in arriving at a conclusion as to whether the claim in genuine or not. An alleged scam might have taken place on LTCG etc. But it has to be established in each case, by the party alleging so, that this assessee in question was part of this scam. The chain of events and the live link of ....
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....ty and correctness of the documentary evidences produced, the same cannot be rejected by the assessee. The Hon'ble Supreme Court in the case of Omar Sa/av Mohamed Salt reported in (1959) 37 ITR 151 (S C) had held that no addition can be made on the basis of surmises, suspicion and conjectures. In the case of CIT(Central), Kolkata vs. Daulat Ram Rawatmull reported in 87 ITR 349, the Hon'ble Supreme Court held that, the onus to prove that the apparent is not the real is on the party who claims it to be so. The burden of proving a transaction to be bogus has to be strictly discharged by adducing legal evidences, which would directly prove the fact of bogusness or establish circumstance unerringly and reasonably raising an interference to that effect. The Hon'ble Supreme Court in the case of Umacharan Shah & Bros. Vs. CIT 37 ITR 271 held that suspicion however strong, cannot take the place of evidence. In this connection we refer to the general view on the topic of conveyance of immovable properties. The rates/sale price are at variance with the circle rates fixed by the Registration authorities of the Government in most cases and the general impression is that cash would h....
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....ions. 17. The Hon'ble Supreme Court way back in the case of Lal chand Bhagat Ambica Ram vs. CIT [1959] 37 ITR 288 (SC) held that assessment could not be based on background of suspicion and in absence of any evidence to support the same, The Hon'ble Court held: "Adverting to the various probabilities which weighed with the Income-tax Officer we may observe that the notoriety for smuggling food grains and other commodities to Bengal by country boats acquired by Sahibgunj and the notoriety achieved by Dhulian as a great receiving centre for such commodities were merely a background of suspicion and the appellant could not be tarred with the same brush as every arhatdar and grain merchant who might have been indulging in smuggling operations, without an iota of evidence in that behalf. The cancellation of the food grain licence at Nawgachia and the prosecution of the appellant under the Defence of India Rules was also of no consequence inasmuch as the appellant was acquitted of the offence with which it had been charged and its licence also was restored. The mere possibility of the appellant earning considerable amounts in the year under consideration was a p....
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.... the various propositions of law laid down by the Courts of law. That cross-examination is one part of the principles of natural justice has been laid down in the following judgments: a) Ayaaub khan Noor khan Pathan vs. The State of Maharashtra and Ors. "23. A Constitution Bench of this Court in State of M.P. v. Chintaman Sadashiva Vaishampayan AIR 1961 SC1623, held that the rules of natural justice, require that a party must be given the opportunity to adduce all relevant evidence upon which he relies, and further that, the evidence of the opposite party should betaken in his presence, and that he should be given the opportunity of cross-examining the witnesses examined by that party. Not providing the said opportunity to cross-examine witnesses, would violate the principles of natural justice. (See also: Union of India v. T.R. Varma, AIR 1957 SC 882; Meenglas Tea Estate v. Workmen, AIR 1963 SC 1719; M/s. Kesoram Cotton Mills Ltd. v. Gangadhar and Ors., AIR 1964 SC708; New India Assurance Co. Ltd. V. Nusli Neville Wadia and Anr. AIR 2008 SC 876; Rachpal Singh and Ors. v. Gurmit Singh and Ors. AIR 2009 SC 2448;Blecco Lawrie and Anr. v. State of West Bengal a....
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....on of natural justice, the High Court should have exercised its jurisdiction of judicial review. 30. The aforesaid discussion makes it evident that, not only should the opportunity of cross-examination be made available, but it should be one of effective cross examination, so as to meet the requirement of the principles of natural justice. In the absence of such an opportunity, it cannot be held that the matter has been decided in accordance with law, as cross-examination is an integral part and parcel of the principles of natural justice." b) Andaman Timber Industries vs. Commissioner of C. Ex., Kolkata-II wherein it was held that: "4. We have heard Mr. Kavin Gulati, learned senior counsel appearing for the Assessee, and Mr. K. Radha krishnan, learned senior counsel who appeared for the Revenue. 5. According to us, not allowing the Assessee to cross-examine the witnesses by the Adjudicating Authority though the statements of those witnesses were made the basis of the impugned order is a serious flaw which makes the order nullity inasmuch as it amounted to violation of principles of natural justice because of which the Assessee was adversely affe....
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....on, as the statement of the a foresaid two witnesses was the only basis of issuing the show cause notice." 19. On similar facts where the revenue has alleged that the assessee has declared bogus LTCG, it was held as follows: a) The CALCL/7TAHIGH COURT in the case of BLBCABLES &CONDUCTORS[ITA No. 78 of20i 7] dated 9. 06.2018. The High Court held vide Para 4.1: we find that all the transactions through the broker were duly recorded in the books of the assessee. The broker has also declared in its books of accounts and offered for taxation. In our view to hold a transaction as bogus, there has to be some concrete evidence where the transactions cannot be proved with the supportive evidence. Here in the case the transactions of the commodity exchanged have not only been explained but also substantiated from the confirmation of the party. Both the parties are confirming the transactions which have been duly supported with the books of accounts and bank transactions. The ld. AR has also submitted the board resolution for the trading of commodity transaction. The broker was expelled from the commodity exchange cannot be the criteria to hold the transaction as bo....
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....t with in detail by the CIT (Appeals) and the Tribunal. Firstly, the documents on which the Assessing Officer relied upon in the appeal were not put to the assessee during the assessment proceedings. The CIT (Appeals) nevertheless considered them in detail and found that there was no co-relation between the amounts sought to be added and the entries in those documents. This was on an appreciation of facts. There is nothing to indicate that the same was perverse or irrational. Accordingly, no question of law arises." d) The BENCH "D"OF KOLKATA ITAT in the case of GAUTAM PINCHA [ITA No.569/Kol/2017]order dated 15.11.2017 held as under vide Page 12 Para 8.1: "In the light of the documents stated i.e. (I to xiv) in Para 6(supra) we find that there is absolutely no adverse material to implicate the assessee to have entered gamut of unfounded/unwarranted allegations leveled by the AO against the assessee which in our considered opinion has no legs to stand and there fore has to fall. We take note the id. DR could not controvert the facts supported with material evidences which are on record and could only rely on the orders of the AO/CIT (A). We note that in th....
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.... the genuineness of the transactions relating to purchase and sale of shares resulting in LTCG. These evidences were neither found by the Id AO to be false or fabricated. The facts of the case and the evidences in support of the assessee's case clearly support the claim of the assessee that the transactions of the assessee were bonafide and genuine and therefore the Id AO was not justified in rejecting the assessee s claim of exemption under section 10(38) of the Act." g) The BENCH 'H"OF t4UMBAIITAT in the case of ARVINDKUMAR JAINHUF[ITA No.46821Mum12014]order dated 18.09.2017 held as under vide Page 6 Para 8: "..... We found that as far as initiation of investigation of broker is concerned, the assessee is no way concerned with the activity of the broker. Detailed finding has been recorded by CIT (A) to the effect that assessee has made investment in shares which was purchased on the floor of stock exchange and not from M/s Basant Periwal and Co. Against purchases payment has been made by account payee cheque, delivery of shares were taken, contract of sale was also complete as per the Contract Act, therefore, the assessee is not concerned with any way of....
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....e contract notes, details of his Demat account and, also, produced documents showing that all payments were received by the assessee through bank." j) The Hon'ble Supreme Court in the case of PCIT vs. Teju Rohit kumar Kapadia order dated 04.05.2018 upheld the following proposition of law laid down by the Hon'ble Gujrat High Court as under: " It can thus be seen that the appellate authority as well as the Tribunal came to concurrent conclusion that the purchases already made by the assessee from Raj Impex were duly supported by bills and payments were made by Account Payee cheque. Raj Impacts also confirmed the transactions. There was no evidence to show that the amount was recycled back to the assessee. Particularly, when it was found that the assessee the trader had also shown sales out of purchases made from Raj Impex which were also accepted by the Revenue, no question of law arises." 20. Applying the proposition of law as laid down in the abovementioned judgments to the facts of this case we are bound to consider and rely on the evidence produced by the assessee in support of its claim and base our decision on such evidence and not on suspicio....
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....came to the conclusion that transaction enteric by the assessee was genuine. Detailed finding recorded by CIT(A) at para 3 to 5 has not been controverter by the department by bringing any positive material on record. Accordingly, we do not find any reason to interfere in the findings of CIT(A). Moreover, issue is also covered by the decision of jurisdictional High Court in the case of Shyam R. Pa war (supra), wherein under similar facts and circumstances, transactions in shares were held to be genuine and addition made by AO was deleted. Respectfully following the same vis-a-vis findings recorded by CIT(A) which re as per material on record, we do not find any reason to interfere in the order of CIT(A)." The facts of the present case are exactly identical. 7.7 In view of the facts and circumstances discussed above and the judicial precedents two of which are of the jurisdictional ITAT and are binding, the addition made by the AO cannot be upheld. These grounds of appeal are ALLOWED. 10. Further the Ld. AR has demonstrated BSE notice with respect to suspension of trading of the scrip as a surveillance measure in notice dated 28.03.2016 where the name of the company at Sr....
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....sactions in shares were rightly held to be genuine and addition made by Assessing Officer was rightly deleted - Held, yes [Para 7] [In favour of assessee] 11. Similarly, the Hon'ble Jurisdictional High Court in the case of Pr. CIT Vs Ziauddin A Sidhique, ITA No. 2012 of 2017 has observed at page 1 to 5 as under: 1. The following question of law is proposed: "Whether on the facts and in the circumstances of the case and in law, the Hon'ble Tribunal was justified in deleting the addition of Rs.1,03.33.925/- made by AO u/s 68 of the I.T. Act, 1961, ignoring the fact that the shares were bought/acquired from off market sources and thereafter the same was demated and registered in stock exchange and increase in share price of Ramkrishna Fincap Ltd. is not supported by the financials and, therefore, the amount of LTCG of Rs.1,03,33,925/- claimed by the assessee is nothing but unaccounted income which was rightly added u/s 68 of the I. T. Act, 1961?" 2. We have considered the impugned order with the assistance of the learned Counsels and we have no reason to interfere. There is a finding of fact by the Tribunal that the transaction of purchase and s....
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....ncome by disallowing the long-term capital gain and added the entire sale proceeds received on sale of shares as income from undisclosed sources under section 68. The revenue was of the opinion that most of the sales of the shares effected by the group were of the same companies and through the same brokers. The Commissioner (Appeals) as well as the Tribunal deleted the addition. 13. Further the Hon'ble High Court in the case of Pr. CIT Vs Smt. Renu Agarwal Income Tax appeal No. 44 of 2022, were the High Court has confirmed the order of the Tribunal and first appellate authority observed as under: This appeal under Section 260 'A of the Income Tax Act, 1961 has been filed challenging the order dated 17.01.2022, passed by the Income Tax Appellate Tribunal, Lucknow Bench "SMC" Lucknow in ITA No.205 of 2020 (A.Y. 2014- 15). The basic question involved in the present appeal is with regard to deletion of some amount which was added by the Assessing Officer on the allegation of penny stock. The appeal of the respondent - assessee was allowed against the assessment order. The appeal filed by the assessee was allowed by the CIT (Appeal). Against the appell....
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....d as to the nature of business carried out by the said company nor has the AO examined the alleged brokers involved in the impugned transactions. We would like to place our reliance on the decision cited by the assessee in the case of DCIT Vs. Sunita Khumka ITAT, (Cul.) (2016) ITRV- ITATCUL.-057 which held that the transaction cannot be held to be bogus merely on the basis of suspicion or surmise and that the AO has to substantiate his finding by bringing material on record to prove collusion/connivance between the broker and the assessee for introducing unaccounted money. We would also like to place our reliance on the decision of Hon'ble jurisdictional Bombay High Court in the case of Commissioner of Income Tax-13 Vs. Shyam R. Pawar wherein it was held that where DMAT account and contract note showed details of share transaction, and AO had not proved said transaction as bogus, capital gain earned on said transaction could not be treated as unaccounted income u/s 68. It is pertinent to point out that we have also considered the recent decision of Hon'ble Calcutta High Court in the case of Principal Commissioner of Income Tax Vs. Swati Bajaj on similar issue which held that the AO....