TaxTMI 
TaxTMI 
TaxTMI 
2025 (7) TMI 1049
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....e appeal with the assistance of ld. Departmental Representative. 3. Assessee has raised following grounds of appeal : 1. The Order of the Appellate Commissioner is contrary to law, facts and circumstances of the case. 2. The Appellate Commissioner erred in confirming the notice issued under section 148 dated 22/04/2021, by the Income Tax Officer, Ward 1, Nanded, Maharashtra, apparently when the Appellant's jurisdiction is in Hyderabad. 3. The Appellate Commissioner ought to have seen that the Assessee has been filling the return of income at the Hyderabad address i.e., 14-7-366 Narayan Bhavan, Begum Bazar, Hyderabad, and even the notice u/s. 148 issued by the A.O, Nanded, Maharashtra, is addressed to the Assessee's Hyderabad address, and it's a case of wrong jurisdiction and the Appellate Commissioner should have quashed the notices issued. 4. Without prejudice to the grounds raised above, the Appellate Commissioner erred in confirming the notice issued u/s. 148, dated 22.04.2021, by the Assessing Officer, which was issued after the new Finance Act came into effect from 01/04/2021, and after the enactment of the Taxation and Other Laws (Relaxation & Amendment o....
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....g the period through artificial jacking up of prices of Equity shares of M/s. Achal Investment Ltd. Ld. AO also observed that assessee has purchased the Equity shares of M/s. Achal Investment Ltd. through offline mode on 12.11.2012. Further, there was no response from the side of assessee to the notice issued u/s. 142(1) of the Act. Ld. AO concluded that the long term capital gain shown by the assessee in the return of income if bogus. He accordingly added the total amount of sale consideration of Rs. 34,42,800/- u/.s.69A of the Act and further made addition for unexplained expenditure amounting to Rs. 34,428/- u/s. 69C for the alleged arrangement of long term capital gain. Income assessed at Rs. 40,31,108/-. 5. Aggrieved assessee preferred appeal before ld.CIT(A) but failed to succeed. Now the assessee is in appeal before this Tribunal raising aforementioned grounds which includes legal grounds as well as grounds on merit. 6. I have heard the contentions of ld. DR and perused the record placed before me. So far as the issue raised by the assessee in Ground Nos. 1 to 6 are concerned challenging the reopening, in absence of any specific rebuttal from the side of assessee and also ....
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....is held that the notice issued u/s. 148 is well within the prescribed time limits and calls for no interference. This argument of the appellant is therefore rejected and Ground Nos. 1 & 2 of the appeal are hereby dismissed. 7. The Ground No. 3 raised by the appellant is that the notice u/s. 148 was issued to the appellant on 22/0403/2021 which was after 3 years from the end of assessment year. Also, the appellant has contended that the notice can be issued beyond the 3 years only if the income escaped is more than 50lakhs, which is not in the case of her. In this regard, the appellant has contended that since the notice was issued after statutory limitation as per the provisions of the act, the assessment order passed by the AO is illegal and against the law and facts of the case. As such, requested the appellate authority to quash the assessment order passed by the AO. 7.1. The appellant has relied upon the following case laws in support of her claim: i). Tata Communications transformation services limited Vs. ACIT (Bombay High Court)-WP.(C) NO 334/2021 ii). Mon Mohan Kohli Vs. ACIT & Anr WP. (c) 6176/2021 - Delhi High Court iii). Ashok Kumar Agarwal Vs. Union of India A....
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.... regarding the change of address (if any). The appellant also has not placed any records evidencing requesting for transfer of PAN jurisdiction. In the absence of any submission in support of her contentions raised in the grounds, the appellant's claim cannot be ascertained. Hence, the Ground No. 4 raised by the appellant is dismissed." 7. From going through the above finding of ld.CIT(A), I find that the same needs no interference and observe that a valid notice u/s. 148 of the Act has been issued to the assessee. Therefore, I hold that the re-assessment proceedings carried out in the instant case are valid. Relevant grounds of appeal No. 1 to 6 raised by the assessee are dismissed. 8. So far as the legal issue raised in Ground No.9 that reopening has been made by ld. AO based on the report of Investigation Wing without further enquiry or verifying the credentials, I fail to find any merit because the Investigation Wing is also a part and parcel of the income-tax department and the object of the wing is to collect the information and carry necessary investigation and such details thereafter are supplied to the concerned Jurisdictional Assessing Officer for doing the relevant....
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....ous long term capital gain to multiple entities and the financials clearly show that the company is a shell company. It was noticed that the appellant is one such beneficiary who received fictitious LTCG during the year under appeal. The Appellant did not furnish any explanation to such findings as mentioned in the impugned Assessment. 10.3. Regarding the exemption claimed in the return of income, the Appellant has claimed that there was profit on transactions through the said share-broker and claimed that she had invested in the alleged shares based on tip from the friend and based on the financials reported by the company. The Appellant has not explained regarding what kind of information she received from her friend to ascertain her claim. Moreover, at the time of investment. M/s Achal Investments Ltd, financials were not encouraging as mentioned in page 10 of the impugned assessment order which does not require reproduction. It is noticed that enquiries caused has revealed information regarding the manipulation of transactions in shares and claiming fictitious LTCG thereon. The appellant has failed to furnish satisfactory explanations regarding how such huge gains were earned....
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....s matter and accepted the transaction and also accepted the bogus gain received by her. The AO has held that the apparent is not real and the evidence furnished by the appellant does not substantiate the alleged fictitious gain claimed as exemption. The AO has made the addition u/s. 69A by relying on the judicial decisions of the Hon'ble Supreme Court in CIT Vs. Durga Prasad More [1971] 82 ITR 540, Sumati Dayal Vs. CIT (214 ITR 801) (SC), Chuhar Mal Vs. CIT (1988) 172 ITR 250 and McDowell Vs. CTO. The case laws relied upon by the appellant cannot be applied in the present case as the appellant has failed to prove the test of human probabilities and failed to establish the circumstantial evidence to prove the transaction is not on manipulative basis. 10.5. Further, it is seen that SEBI has levied a penalty on M/s. Achal Investments vide order dated 02/09/2021 for its activities of defrauding the shareholders and diverting and misutilising the proceed received from the preferential issue of shares also it is seen that M/s. Achal Investments was restrained from the accessing the securities market and from buying, selling are dealing in securities either directly or indirectly fo....
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....en particularly qua one company. which was part of list of 84 companies, where investments were held by High Court as bogus, and further, assessee's investment could not become genuine merely because he earned a lesser amount of profit, thus, impugned order of AO was to be upheld." 10.6. It is held that the facts of the present are squarely covered by the above mentioned case laws and in view of the foregoing discussion, it is opined that there is no need to interfere with the addition made by disallowing the appellant's claim of exemption in the assessment order. In view of the above legal position and the fact that the appellant has undertaken transactions and as appellant has involved in transactions of bogus LTCG, the entire exemption have been rightly added to the total income of the appellant by the AO. The assessment order passed by the AO doesn't require any interference in this regard. 10.7. The appellant also raised objection to the addition made by the AO of Rs. 93,250/- being unexplained expenditure u/s. 69C of the Act by determining the expense/commission paid the rate of 1% on Rs. 34,42,800/-. It is seen from the impugned assessment order that the AO h....