TaxTMI 
TaxTMI 
TaxTMI 
2025 (9) TMI 1235
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....ssee for the assessment year under consideration dated 28.03.2017 declaring total income at Rs. 7,39,410/- was processed on 26.05.2017. Thereafter, the information was received from the DDIT (Inv.), Wing-6(3), Mumbai to the effect: " That investigation was carried out under the "Project Falcon' regarding claim of fictitious losses through coordinated and premeditated trading in illiquid stock options. During the investigation, it had come to notice that there were several instances/internal alerts, wherein a set of entities were consistently seen incurring trading loss by executing Reversal of trades in options on individual stocks ("stock options") in Equity Derivative Segment. However, it has also come into notice that along with Re....
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.... through ODYSSEY SECURITIES PVT. LTD. totaling to Rs. 28,17,775/- during FY 2015-16. Therefore, it is clear that the assessee is one of the beneficiary by indulging into tax evasion through coordinated and premeditated trading in illiquid stock options on the Bombay Stock Exchange by claiming non-genuine and fictitious Profits/Losses on illiquid derivatives/equity on BSE to the extent of Rs. 28,17,775/- done during the year under consideration relevant to AY 2016-17". 3. The Assessing Officer (AO), on verifying the aforesaid information, has seen that the Assessee has not disclosed the details of above transaction in the return for the A.Y. 2016-17 and therefore by forming the reason to believe that income chargeable to tax exceeding Rs. ....
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....x Act, 1961, before issuing the notice u/s 148, there should be evidence which satisfies that there has been an escape of income in case of the assessee. However, as per the return of income filed by the assessee, it is clearly evident that the assessee has already offered income from business u/s 44AD of the Act, so it seems that the notice has been issued without verifying the return of income of the assessee which is bad-in-law" 4. The AO, thereafter also issued the notice 31.03.2023 u/s 142(1) of the Act, in response to which, the Assessee prefers not to file any reply. 5. The AO though reproduced the claim/reply of the Assessee to the effect that the recovery offered under business income u/s 44AD of the Act is amounting to Rs. 28,6....
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....ut applying his mind. The facts of the case are that the appellant had done the transactions in F&O trading and earned profit but offered only 8% on the turnover u/s.44AD of the Act. The DDIT, Investigation Wing-6(3), Mumbai through insight portal had uploaded the details of investigation carried under the Project Falcon' regarding claim of fictitious gains and losses. The Modus Operandi came to the knowledge of the department when the relevant brokers were subjected to search and on being confronted with evidences, confessed that they were engaged in providing bogus losses/gains on derivatives to the various beneficiaries. The data found in the searched premises was analysed and in the said analyses, the appellant was found to be the b....
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....neficiary of bogus gains in the data found. Hence, this information used by the AO cannot be said to be a borrowed satisfaction recorded for issue of notice u/s. 148 of the Act and from the assessment order, it is seen that the AO has analysed the data and has passed a speaking order that the appellant had concealed the particulars of Income. 8.3 The appellant has accepted that the F&O turnover done by her through ODC Securities Pvt. Ltd. was to the tune of Rs. 28,17,775/- and offered net profit of 10.57%. It means the appellant has offered to tax Rs. 2,97,839/- u/s 44AD of the Act. Whereas according to the AO, the appellant has earned F&O bogus profit of Rs. 28,17,775/-, out of which only Rs. 2,97.839/- was offered to tax warranting the....
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.... of Rs. 2,97,839/- which was offered to tax by the Assessee u/s 44AD of the Act. 8. On the contrary, the Ld. D.R. refuted the claim of the Assessee by submitting that the Assessee has not only failed to substantiate her claim but also the case as made by the AO and affirmed by the Ld. Commissioner is based on the detailed analysis made by the DDIT (Inv.) and therefore the addition restricted to the extent by the Ld. Commissioner, may be affirmed by dismissing the appeal of the Assessee. 9. Heard the parties and perused the material available on record. Admittedly, the Assessee before both the authorities below has claimed that the transacted amount of Rs. 28,17,775/- relates to the F & O transaction done through ODC Securities Pvt. Ltd. o....