TaxTMI 
TaxTMI 
TaxTMI 
2024 (8) TMI 1658
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....is already decided in assessee's favour by order of this Tribunal on merits in the case of husband on identical facts and circumstances. Hence, we dismiss the Cross Objection of the assessee and proceed to adjudicate the grounds raised by the Revenue before us. 3. Though, the Revenue has raised several grounds before us, the only effective issue to be decided in the appeal of the Revenue is as to whether the learned CIT(A) was justified in deleting the addition made by the learned AO on account of denial of exemption under section 10(38) of the Act for Long Term Capital Gains (LTCG) on sale of shares of Capital Trade Links Ltd. The interconnected issue involved therein is with regard to alleged commission expenditure added as unexplained expenditure under section 69C of the Act on account of cost of arranging alleged accommodation entry by the assessee. 4. We have heard the rival submissions and perused the material available on record. It is not in dispute that assessee purchased the shares of M/s. Capital Trade Links Ltd. (CTL) at Re.1/- per share in earlier years. The assessee sold those shares during the year under consideration through a registered stock broker in th....
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....issed by the Hon'ble Supreme Court which is reported in 153 Taxmann.com 579. The learned CIT(A) also observed that even on the date of passing of the CIT(A) order, the concerned scrip i.e. M/s. Capital Trade Links Ltd was active and being traded online in the share market and it also declared dividend during the financial years 2017-18 and 2018-19. With all these observations and by placing reliance on the decision of Hon'ble Allahabad High Court referred (supra), learned CIT(A) held that the learned AO was not justified in making the addition of Rs.2,20,89,060/- on account of bogus LTCG under section 10(38) of the Act and deleted the same. Correspondingly, the addition made under section 69C of the Act towards unexplained expenditure was also deleted by the learned CIT(A). 5. We find that the very same issue was subject matter of adjudication by this Tribunal in the case of assessee's husband, Shri Sanjeev Agrawal vs. ACIT in ITA Nos. 1518 & 1519/Del/2021 for A.Ys. 2016-17 & 2017-18 respectively dated 20.09.2023 wherein the assessee's husband also traded in the very same scrip of Capital Trade Links Ltd. and this Tribunal had deleted the addition made by the Ass....
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.... 11.01.2021 Additional ground filed by assessee (318-320) along with Written submission (321-374 15. Copy of show cause notice for enhancement (375) 16. 11.01.2021 Further written submission filed by assessee before First Appellate Authority (376-385) 17. 27.09.2021 Order passed by first appellate authority disposing the various grounds raised by the appellant as under :- Ground No. Particulars Page no of Cl 1(A) order 5.6-7 General 2-5 Addition of Rs. 3.03,05,713/disallowing exemption u/s 10(38) of the Act is bad in law Dismissed (43-56) Enhancement of expenditure incurred u/s 69C of the Act of Rs 9.09,171 /- (56-57) Additional Ground 1 hat the Ld AO has erred in law and on tacts in levying the tax @77.25% invoking the provisions of S. 1I5BBE of the Act as against the lower tax rate of 20% as prescribed u/s 1 12 of the Act Dismissed (67-69) 18. 25.10.2021. Aggrieved by the aforesaid order of Hon'ble First Appellate Authority assessee filed instant appeal raising below mentioned grounds S. no Grounds Particulars ') 1, 5 Gene....
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....) No such information provided to appellant. (Para 17-17.2) The learned Assessing Officer has mechanically lifted the conclusions/ observations arrived without making any independent inquiries either from SEBI or stock exchange or broker or share company to ascertain genuineness of such transactions. (Para 12-12.2) vii) Recommendations of the SIT of Hon'ble supreme court on Black Money pointed out the Modus Operandi 3.5 (6-8) General report viii) Scrip in which appellant traded, prima facie appearto be a penny stock s return of 7704.65% seems unreal in short span of time - the price of the shares of Capital Trade Links were rigged & manipulated and were increased through circular transaction by unscrupulous elements. 4 (8-9) That there is range bound movement in the share price of Capital Trade Links Ltd. much less the share has been listed with Bombay Stock Exchange at Rs.98 in June 2014 which reached to highest of Rs.132 within a period of 2 years and 3 months and as such no abnormal increase much less assessee sold shares at prices ranging from 69 to 95, which is not the highest prices (Para 11 to 11.2) Further Appellant also filed clarificat....
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....d above relating to the respective contention. Summary of said multi-fold contentions is as under: Sr. No Particulars i) Investment and disinvestment in share of Capital Trade Link Ltd. cannot be treated as accommodation entries in the garb of Long Term Capital Gain when the transaction of sale and purchase of shares has been explained by placing sufficient documentary evidence on record. Revenue has not disproved the documentary evidences furnished by the assessee. No efforts have been made by the ld. Assessing Officer to examine the correctness of various proof, filed by the assessee by carrying out any investigation. ii) Off-market purchase transaction made by the assessee is not an illegal transaction. iii) Assessee sold shares through Online Trading platform after payment of STT. iv) Transactions carried out by the assessee through Stock Exchange are without any physical interaction between buyer and seller. v) Assessee is a habitual investor having portfolio of investment in shares and has earned capital gain both in preceding and succeeding years. vi) Neither the trading in shares of Capital Trade Link Ltd. is suspend....
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....referred by the ld. DR in his submission and as extracted above, we find that it does not in way suggest that scrip of CTL is suspended or has failed to comply with listing requirements of the stock exchange so as to conclude on an adverse finding recorded by the authorities below. 8.5. Also, under section 142(3), it is incumbent upon the ld. AO to give an opportunity of being heard in respect of any material gathered by him and proposed to be utilised for the purpose of the assessment. We note that compliance of provisions of sec. 142(3) is a mandatory statutory procedural requirement in completing the assessment proceeding, failure of which may vitiate the entire assessment itself since this sub-section uses the word "shall". The only exception to this requirement is where an assessment is made u/s 144 which is not so in the present appeal before us. In the present case before us, requirement mandated by section 142(3) has not been complied with by the ld. AO in completing the impugned assessment. 8.6. On careful reading of the show cause notice issued by the ld. AO as reproduced in the impugned assessment order, we observe that nowhere, ld. AO has mentioned any....
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....ss of the buyers of the shares sold by the assessee and genuineness of the said transaction. We do not find any action taken by the ld. AO to enquire on these three vital aspects from the assessee either by issuing notices/summons under section 133(6) or 131 of the Act. 8.6.3. In this context, it is worth noting that impugned share sale transaction undertaken by the assessee is on the online digital trading platform of stock exchange of BSE which is a regulated market under the aggies of a regulator viz. SEBI. There is nothing on record from the market regulator SEBI which establishes the 'tainted' status of the scrip of CTL SO as to hold the share sale transaction as bogus/ accommodation entry by the ld. AO. Also, the operations and modus operandi of this regulated market does not in any way provide for any mechanism by which assessee can bring forth the identity of the buyers of its shares and their creditworthiness. Further, sale proceeds are received through the stock market processing into the pre-identified bank account of the seller i.e. the assessee which cannot be tainted as 'unexplained or unaccounted or undisclosed'. Thus, it cannot be inferred t....