TaxTMI 
TaxTMI 
TaxTMI 
2026 (3) TMI 273
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..... 20/- each and payment was made through proper banking channel. Later the company was amalgamated with M/s. Sunrise Asian Ltd (SAL) a listed entity. These 15000 Shares of SAL were held for around 22 months and were sold on various dates in FY 2013-14 on Bombay Stock Exchange Limited (BSE) platform by paying STT thereon on sale of these shares. Thus all the eligible conditions of u/sec 10(38) of the Act are duly complied with. The assessee was duly eligible to claim exemption and had claimed exemption thereon. The assessee made the total sale amount of Rs. 7,41,59,400/-. The assessee claimed the deduction u/sec. 10(38) of the Act related to profit on sale of share of long term capital gain. During the assessment proceeding the Ld. AO made the entire transaction as a bogus transaction, disallowed the exemption u/sec. 10(38) of the Act and added back the entire sale proceeding amount to Rs. 7,41,59,400/- with the total income of the assessee. Aggrieved assessee filed an appeal before the Ld. CIT(A). The Ld. CIT(A) uphold the order of the Ld. AO. Being aggrieved assessee filed an appeal before us. 3. The Ld. AR argued and filed a paper book containing page 1 to 87 which has been pl....
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....ining to the scrip of M/s Sunrise Asian Ltd. Though the AO has recorded that the assessee has traded through exit providers who did not respond to notice under section 133(6), the AO did not record any specific finding with regard to the names of the exit providers and any evidence that the assessee has transacted through the exit providers. Therefore, in our view, the reasons as recorded by the AO as above cannot be considered as only reason for treating the impugned transactions as bogus in the hands of the assessee without establishing assessee's involvement in the price movement or that the assessee has transacted through the exit providers. The findings of the AO with regard to SEBI report mentions a company name M/s. Monarch Health Services Ltd and its director without recording any finding regarding the assessee's connection with the brokers/entry operator. We in this regard further notice that the Co-ordinate Bench has considered the identical issue in the case of LalitabenPravin Shah (supra) where it has been held that." 5. He further respectfully relied on the order of Coordinate Bench of ITAT Mumbai 'E' Bench in case of Haresh Dilip Vora vs ITO ITA No.3646/Mum....
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....td. ("RFL") is done through stock exchange and through the registered Stockbrokers. The payments have been made through banking channels and even Security Transaction Tax ("STT") has also been paid. The Assessing Officer also has not criticized the documentation involving the sale and purchase of shares. The Tribunal has also come to a finding that there is no allegation against assessee that it has participated in any price rigging in the market on the shares of RFL. 3. Therefore we find nothing perverse in the order of the Tribunal." 4. Mr. Walve placed reliance on a judgment of the Apex Court in Principal Commissioner of Income-tax (Central)-1 v. NRA Iron & Steel (P.) Ltd. but that does not help the revenue in as much as the facts in that case were entirely different. 5. In our view, the Tribunal has not committed any perversity or applied incorrect principles to the given facts and when the facts and circumstances are properly analysed and correct test is applied to decide the issue at hand, then, we do not think that question as pressed raises any substantial question of law. 6. The appeal is devoid of merits and it is dismissed with no order as to costs." ....
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....f and in law. We hold that the Appeals do not raise any substantial question of law. They are accordingly dismissed. There would no order as to costs." Hon'ble Delhi High Court in the case of Pr.CIT vs Smt. Krishna Devi 431 ITR 361 (Del). The relevant paragraph is enclosed here with: - "12. Mr. Hossain's submissions relating to the spike in the share price and other factors may be enough to show circumstances that might create suspicion; however the Court has to decide an issue on the basis of evidence and proof, and not on suspicion alone. The theory of human behavior and preponderance of probabilities cannot be cited as a basis to turn a blind eye to the evidence produced by them. Respondent. With regard to the claim that observations made by the CIT(A) were in conflict with (he Impugned Order, we may only note that the said observations are general in nature and later in the order, the CIT(A) itself notes that the broker did not respond to the notices. Be that as it may, the CIT(A) has only approved the order of the AO, following the same reasoning, and relying upon the report of the Investigation Wing. Lastly, reliance placed by the Revenue on Suman Poddar cas....
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....pectfully relied on the order of Hon'ble Supreme Court in PCIT vs Smt. Renu Aggarwal [2023] 456 ITR 249 (SC). We respectfully rely on the orders of the Hon'ble Apex Court, Jurisdictional High Court and Coordinate Bench of ITAT Mumbai which has similar in the factual matrix with the impugned issue. The grounds of appeal of the assessee are upheld. We set aside the impugned appeal order. The additions amount to Rs. Rs. 47,51,164/- U/s 68 of the Act and amount to Rs. 50,061/- U/s 69C are quashed." 6. The Ld. DR vehemently argued and contended that entire transaction is accommodation entry. The revenue authorities have rightly treated as bogus transaction. The Ld. DR stands in favour of the order of the revenue authorities. 7. We have heard the rival submissions and perused the material available on record, including the paper book filed by the assessee. It is an undisputed fact that the assessee had purchased 15,000 shares through proper banking channels; the shares were duly reflected in the Demat account; the amalgamated shares of M/s. Sunrise Asian Ltd. were held for more than 22 months; and the sale was effected through the BSE platform upon payment of STT. The asse....