TaxTMI 
TaxTMI 
2025 (2) TMI 1278
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....ssment proceedings without any cogent material on record should be treated as bad in law and the order passed under Section 147 read with Section 144C of the Act should be set aside. 2. On the facts and circumstances of the case and in law, the AO had erred in assessing the sale value of equity shares of Kushal Lad of 42.21.000 as unexplained cash credit as per the provisions of Section 68 of the Act under the head 'Income from other sources simply based on the information flagged in insight portal and the information gathered or evidence obtained during the course of search and seizure action, carried out under Section 132 of the Act on Kushal group, without appreciating the fact that the provisions of Section 68 of the Act were not applicable to the appellant since the appellant being a company incorporated in Mauritius and registered with the Securities and Exchange Board of India as a Foreign Portfolio Investor for the purposes of making investment in India, was not required to maintain books of accounts as per the applicable provisions of the Companies Act, 2013 as well as the applicable provisions of the Act, which is a pre requisite for invoking the provisions o....
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....the facts and circumstances of the case and in law, the AO had erred in computing the tax liability on sale value of equity shares of Kushal Lid of Rs. 42,21,000 assessed as unexplained cash credit as per the provisions of Section 68 of the Act under the head 'Income from other sources', as per the provisions of Section 115BBE of the Act, without appreciating the fact that the provisions of Section 68 of the Act were not applicable to the appellant. The appellant prays that such computation of tax liability was without any application of mind and should be deleted. 6. On the facts and circumstances of the case and in law, the AO had erred in levying surcharge 25% on the tax liability computed as per Section 115BBE of the Act, without appreciating the fact that the provisions of Section 115BBE of the Act were not applicable and the total taxable income of the appellant was not exceeding Rs. 1 crore. The appellant prays that such levy of surcharge was without any application of mind and should be deleted. 7. On the facts and circumstances of the case and in law, the AO had erred in initiating penalty proceedings under Section 270A of the Act for misreporting....
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....ings in assessee's case and passed an order under section 148A(d) of the Act along with notice under section 148 on 26.03.2022. The AO called on the assessee to furnish details pertaining to the impugned transaction and the assessee submitted the details as called for by the AO. The AO elaborately discussed the SEBI order in the case of M/s Kushal Trade Link Ltd. (now known as Kushal Ltd.) and also the findings of the search action. The AO concluded on the basis of the material found during the course of search and the statement recorded to the effect that there was systematic and synchronized trading in the shares of Kushal Ltd. in Stock Exchange where various people closely connected with Kushal Ltd. were involved. The AO gave a finding based on the SEBI order and the search operation that the share prices of Kushal Ltd. was manipulated and unaccounted cash transactions have been accommodated through bogus transactions. Since the assessee during the year under consideration has made a transaction to the tune of Rs. 42,21,000/- towards sale of the shares of M/s Kushal Trade Link Ltd. (now known as Kushal Ltd.) the same was added by AO under section 68 of the Act. The assessee ....
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....ed on various decisions of the Co-ordinate Bench to submit that the gain arising out of purchase and sale of M/s Kushal Trade Link Ltd. (now known as Kushal Ltd.) have been held by the Tribunal as not to be added under section 68. The ld. AR without prejudice submitted that Kushal Ltd. has a full-fledged manufacturing facility having subsidiaries in India and abroad with huge turnover, profit and tax payments year after year. The ld. AR further submitted that Kushal Ltd. has declared a dividend year after year and involved in CSR activity and its shareholder include Banks, FPIs, etc. The ld. AR in this regard took the Bench through the financial statements of Kushal Ltd. (page 28 to 282 of PB). 4. The ld. DR on the other hand relied on the order of AO and the directions of the DRP. 5. We heard the parties and perused the material on record. The assessee during the year under consideration has sold 20,000 shares of M/s Kushal Trade Link Ltd. (now known as Kushal Ltd.) for a consideration of Rs. 42,16,600/- and after deducting the cost of acquisition at Rs. 21,26,200/- arrived at the gain of Rs. 20,90,400/ -. The assessee being a tax resident of Mauritius claimed the treaty ben....