TaxTMI 
TaxTMI 
2025 (12) TMI 662
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....Appellant had earned tax free long term capital gain u/s. 10(38) by selling his shares held for more than 1-2 years on Stock Exchange Platform and has duly paid STT levied by said Stock Exchange. Learned Assessing Officer generally relied upon the statements given by some Vipul Shatt and nowhere learned AO could prove that assessee was part of the modus operandi or he was in any way connected to Vipul Bhatt or to any other entity involved in this racket. Even Appellant's request for cross examination of Vipul Shatt was also grossly rejected thereby depriving appellant of natural justice. Further addition is made u/s 68 whereas Appellant has duly explained the whole capital gain and therefore the question of unexplained cash credit does not a rise at all. Hence addition of Rs. 2,41,53,979/- deserves to be deleted. GROUND 2: Addition on Account of Commission paid u/s 69C of the Act. That the Ld. Assessing Officer has grossly erred in adding commission based on statement of some Vipul Bhatt with whom appellant had no relation and learned AO also could not provide any link between appellant and Vipul Bhatt. Appellant request for cross examination of Vipul Bhatt wa....
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....hat the said SAL scrip is not a sham transaction. During the assessment and appeal proceedings, the assessee filed the detailed submissions and filed evidence related to the transaction. The notice of the revenue including the compliances of assessee are submitted in APB before the bench. The details are reproduced as below: - Sr.No. Particulars APB Page No. 1. Copy of the notice dated 03.10.2016 issued under section 142(1) of the Act 1 2. Copy of the letter dated 19.10.2016 filed in response to the abovementioned notice along with the following annexures: a. Annexure II - Details of bank accounts maintained by the assessee b. Annexure III- Copy of ITR Acknowledgement along with computation of income, Capital account, Balance sheet, Profit and Loss Account for A.Y. 2014-15. 2 3 4-26 3. Copy of the notice dated 19.12.2016 issued under section 142(1) of the Act. 27-32 4. Copy of the letter dated 23.12.2016 filed in response to the abovementioned notice along with the following annexures: a. Annexure 2 - Copy of the prospectus of Monarch Health Services Limited alognwith certificate issued for change of name. 33-37 ....
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....bogus gains. Therefore, I do not find any infirmity in the addition made u/s 68 of the Act. Therefore, the grounds of appeal related to the addition on account of transactions in the scrip of M/s Sunrise Asian Limited and M/s Monarch Health Services Limited are dismissed. 7. Through Ground of Appeal No. 2. the appellant challenges addition made on account of commission paid to entry provider under section 69C of the Act. The Assessing Officer held that on obtaining accommodation entries, it is an accepted fact that the commission of about 3-4% of the transaction is paid to the broker who negotiates the deal. As the appellant had received gains amounting to Rs. 2,41,53,979/- therefore, the Assessing Officer disallowed the amount of Rs. 9,66,159/- @ 4%. The appellant submitted that there is no basis regarding the addition made by the Assessing Officer. Reliance can be placed on the decision of the Hon'ble Mumbai Tribunal in the case of Arvind M. Kariya v. ACIT [IT Appeal No. 7024 (Mum.) of 2010, dated 30-1-2023), wherein it was held that when there is no doubt that such transactions involve certain money paid to the operators/arrangers of such fraudulent capital gains, t....
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....the rival submissions and perused the material available on record. The issue in the present appeal pertains to the addition made concerning the assessee's claim of the LTCG arising from the sale of shares of SAL & MHSL. The Ld. DR relied on decisions of the co-ordinate benches related to LTCG arising from the sale of shares, which are distinguishable on facts. In the present case, the assessee transacted in shares of SAL, which were also the subject of scrutiny by the Hon'ble Gujarat High Court in Divyaben Prafulchandra Parmar (supra) & Hon'ble High Court of Madhya Pradeshin Shri Nilesh Jain (HUF) (supra), where no irregularities were found. The Ld. CIT(A) relied on the order of the Hon'ble Delhi High Court in Udit Kalra (supra) which is dealt with the scrip "Kappac Pharma Ltd". So, said judgment is factually distinguishable. For both the share script the assessee purchased the shares through the BSE, made payments via banking channels, and submitted contract notes, STT was paid and Demat account details evidencing delivery of shares. The assessee subsequently sold shares through the BSE, with delivery made from the same Demat account. The Ld. AO did not dispute the sale procee....