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2025 (11) TMI 1593
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.... "PS IT infrastructure & services ( formerly known as "Parag Shilpa investments Limited) has been discussed and adjudicated in favour of assessee, based on the fact that assessee had submitted evidences before the assessing officer to prove his claim, such as purchase bills, bank statements, contract notes, payment of STT and assessee fulfilled the conditions of section 10(38) of the Act. Learned counsel for the assessee submitted that the present appeal is squarely covered by the aforesaid order of the Tribunal, a copy of which was also placed before the Bench. 3. Learned Departmental Representative, relied upon the orders of the authorities below. 4. I see no reasons to take any other view of the matter than the view so taken by the Division Bench of this Tribunal in the case of Ashok T. Jobanputra(supra) vide order dated 31.07.2024. In this order, the Tribunal has inter alia observed as follows: "6. The assessing officer, thereafter examined the price movements and nature of script, vide page number 3 to 11 of the assessment order. Thereafter, a show cause notice dated 22 March 2022, along with draft assessment order with proposed addition, was sent to the assesse....
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....3 and the same was sold by the assessee, during the year 2015 and submitted all the details relating to the claim u/s 10(38) of the Act, before the assessing officer. There is no finding of the assessing officer, as to why the claim of the assessee based on these evidences is not in accordance with the law. Not only that assessing officer has added the amount of Rs. 3,28,81,890/- under section 68 of the Act, based on the documents placed on record, the assessing officer has not recorded any reason as to why the addition can be made under section 68 of the Act and on what reasons and why the evidences placed on record which are the third- party evidences are not considered. The assessing officer has not examined any evidence by issuing any notice u/s 133(6) of the Act, not only that there is no adverse statement in any other case, is recorded, and placed on record so as to believe that the broker with whom assessee has dealt, is engaged in entry operating business. The purchase is by paying an account payee cheque, supported by bill of purchase, entry in the register of share holder endorsed on the share certificate, the said shares were dematerialized by following the prescribed pr....
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....Revenue, argued that assessee has obtained the long- term capital gain (LTCG), which is fictitious, therefore assessee had defraud the Revenue, by paying the less income tax. The Ld. CIT-DR submitted that fraud vitiates everything and considering the sudden jump in the price of the share, it can be said that assessee received the penny stock gain in order to off-set the loss or to convert the unaccounted money into white money, and that was the reason that the Government has introduced Section 56(2)(viia) of the Act. The assessee received the bogus long term capital gain (LTCG) and that is why, section 10(38) of the Act, by way of insertion of third proviso whereby the transactions in long term capital gain (LTCG) would be exempted only in those cases where the transactions were subjected to Securities Transaction Tax (STT), however, the assessee has failed to satisfy this condition. The Ld DR for the revenue has heavily relied on the judgement of the Hon'ble High Court of Kolkata, in the case of Swati Bajaj 139 taxman.com352(Cal) and stated that assessee's appeal should be dismissed. 12. Departmental Representative (Ld. CIT-DR) for the Revenue, further stated that....
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....s the duty of the assessing officer to marshal all the facts and come to a logical conclusion about the documents submitted by the assessee, for that we rely on the Judgment of Hon'ble Supreme Court in case of Sreelekha Bannerjee (491 ITR 122), wherein it was held that .. before the department rejects such evidence, it must either show an inherent weakness in the explanation or rebut it by putting to the assessee some information or evidence, which it has in possession ... " 14. We note that assessee purchased 40,000 shares of PS IT Infrastructure & Services Limited on 24.07.2013 from the Bhushit Trading Private Limited, for the sum of Rs. 16,00,000/-. The assessee produced before us following supporting documents for purchases, viz: (i)The copy of Purchase bill issued by the thinks Trading Pvt. Ltd (pb-1) (ii) The bank statements reflecting the payment made for the purchase of the shares (Pb page no. 2 to 3), (iii)The cheque given by the assessee to the broker for purchase of the shares (Pb page no. 4 to 5), (iv)Transfer Certificate dated 29.11.2013(Pb page no. 6),(v)Physical certificate shares where in endorsement of transfer of shares in the name of the assessee on ....
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.... 24.03.2015 65000 50,35,144 24.07.2013 2,60,000 47,75,144 20 Page no. 17 to 17 12. 26.03.2015 68000 51,16,616 24.07.2013 2,72,000 48,44,616 20 Page no. 17 to 17 13. 27.03.2015 33000 23,59,733 24.07.2013 1,32,000 22,27,733 20 Page no. 17 to 17 4,00,000 shares (40,000 shares sub-divided into 10 shares per share i.e. 4,00,000 shares) 3,28,35,919 16,00,000 3,12,35,919 The details of other charges paid during the sale of shares is as follows: Security Transactions Tax Rs. 32,948/- Service Tax Rs. 8,277/- Other Rs. 1,137/- Total Rs. 42,362/- *the other charges are Evident from the Global Report attached herewith from page no. 18 to 18. 16. From the above purchase and sale transactions, it is vivid that assessee 'spurchase and sale, both are genuine and supported by genuine evidences, noted above. From all the above evidences placed on the record, such as purchase consideration by paying an account payee cheque, supported by bill of purchase, entry in the register of shareholder endorsed on the share certificate, the sa....
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....ares of companies were purchased online, payments were made through banking channels, and shares were dematerialized. Additionally, the shares were transferred from the dematerialized account and received consideration through legitimate banking channels. Assessing officer did not have any independent source or evidence to show an agreement between the assessee and any other party to convert unaccounted money by taking the fictitious loss. The decision of assessing officer was unsupported by any material on record, and the finding was purely on an assumption basis. Thus, no substantial question of law arose from the order of the Tribunal, and the same was to be upheld." 19. We note that in the following decisions, of various Co-ordinate Benches, of ITAT, wherein the same script is involved, as that of the assessee under consideration, and addition made by the assessing officer, were deleted: (i) Abhishek Doshi vs CIT(A), ITA No.3122/Mum/2022, dated 31.05.2023 (ii) Bhadresh Mansukhlal Dodhia vs ACIT, ITA No.5544/Mum/2018, dated 06.01.2021 (iii) Pradipkukar Harakchand Doshi vs ITO, ITA No.2229/Mum/2023, dated 15.03.2024 (iv) Yogesh P. Thak....
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....consideration the notice of contract memo placed on record by the respondent assessee with regard to the purchase and sale of shares and it is also found by the appellant that the respondent was holding shares of other fifteen companies and it has continued to hold the shares over three years and therefore, sale of the shares cannot be said to be bogus merely on the basis of suspicion on account of the fact that the substantial quantum of capital gain and has been earned by the assessee on account of trading in respect of the said shares. Merely because trading in the shares of the said company was suspended on the Stock Exchange, in absence of any material brought on record to suggest that purchase and sales of said shares was bogus, the Assessing Officer was not justified in absence of any material to support his finding that there has been collusion or connivance between the broker and the assessee for the introduction of his own unaccounted money, resulting into a bogus transaction. 21. We find that Ld. CIT-DR for the Revenue heavily relied on the judgement of Hon'ble High Court of Calcutta in the case of PCIT vs. Swati Bajaj, 139 taxmann.com 352 (Cal) and stated t....
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....he same, the proper procedure is to refer the binding decision and direct the papers to be placed before the Chief Justice to enable him to constitute a larger Bench to examine the question [see Food Corporation of India vs. Yadav Engineer & Contractor AIR 1982 SC 1302]. (ii) A Division Bench of a High Court should follow the decision of another Division Bench of equal strength or a Full Bench of the same High Court. If one Division Bench differs with another Division Bench of the same High Court, it should refer the case to a larger Bench. Where there are conflicting decisions of Courts of co-ordinate jurisdiction, the later decision is to be preferred if reached after full consideration of the earlier decisions. (d) The decision of one High Court is neither binding precedent for another High Court nor for Courts or Tribunals outside its own territorial jurisdiction.It is well settled that the decision of a High Court will have the force of binding precedent only in the State or territories in which the Court has jurisdiction. In other States or outside the territorial jurisdiction of that High Court it may, at best, have only a persuasive effect. By no ....
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.... in any such wrong doings, or all the alleged scam, as referred by the assessing officer in the assessment order. Not a single statement of a person refers the name of the assessee nor any evidence showing the name of the assessee is confronted to the assessee to establish the contention of the revenue. Thus, lower authority failed to bring any proof / evidence/ connection regarding involvement of any cash trail activity which subsequently proves that assessee transformed his unaccounted money. Besides, assessing officer, failed to provide the opportunity of cross examination regarding details reported on AIMS module of ITBA portal, whether the information was reported based on any Investigation Wing Report / Statement of any person reported by Income Tax Department. However, no such information was shared with assessee. Hence in absence of providing opportunity of cross examination, the order passed is bad in law, for that reliance can be placed on the judgement of Hon'ble Supreme Court in the case of M/S Andaman Timber Industries vs. Commissioner of Central Excise in Civil Appeal No. 4228 of 2006. Therefore, based on these facts and circumstances, we allow the appeal of the a....