TaxTMI 
TaxTMI 
2026 (8) TMI 1262
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....iny through CASS and notice under section 143(2) of the Act dated 13-04-2026 was issued and duly served upon the assessee. Thereafter, statutory notices under section 142(2) of the Act along with questionnaire were issued to the assessee. In compliance to the notices, Shri Pawan Kumar Accountant & Authorized representative of the assessee attended the proceedings and furnished the written submissions. According to Assessing Officer the assessee has earned LTCG on sale of shares of M/s. channel Nine Entertainment Ltd. during the year under consideration. The Assessing Officer found that the assessee has used a prearranged device in form of booking of Bogus LTCG of amount of Rs. 3,50,75,288/- during the relevant year to bring into books their unaccounted income and make the addition of Rs. 3,60,74,925/- under section 68 of the Act as unexplained income. The Assessing Officer also made the addition of 5% commission of the said amount Rs. 18,03,746/- and penalty proceedings also initiated. 3. Aggrieved the order of the Assessing Officer the assessee filed this appeal before the Ld. CIT(A) who vide his order dated 17-04-2025 dismissed the appeal. Being aggrieved the order of the Ld. ....
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....e the Hon'ble ITAT to decide the course of appeal according to the law. 4. Ground number-1 is general in nature need not to be adjudicate. Ground No.2 to 2.4: 5. The Ld. AR of the assessee submitted that assessee is accompany engaged in the business of stock broking and trading in securities and is a registered trading member of the National stock Exchange of India Limited("NSE") and Bombay Stock Exchange Limited ("BSE"), authorized to under take purchase and sale of shares and securities both on its own account and on behalf of its clients. The assessee is also registered as an SME Market Maker and forms of the panel approved Market Makers recognized by the Stock Exchange for providing liquidity in securities listed on the SME platform. He further submitted that the assessee has regularly dealt in multiple scrip over the years and not a one- time investor. The Assessing Officer also recorded in the assessment order that the assessee had earned gains as well as suffered losses on the long-term investments. He further submitted that M/s Channel Nine Entertainment Limited came out with an Initial Public offer of 46,68,00 equity shares of face value Rs. 10/-each at an issue p....
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....CIT Central Circle Delhi ITA NO. 2531/Del/2022 (ITAT Delhi) (ii) Amit Rastogi HUF v. ITO ward1(1) Meerut ITA No. 2128/Del/2018 (ITAT Delhi) (iii) Nirmal Gupta V. Pr. CIT -9 New Delhi ITA No. 108/Del/2018 (ITA Delhi) In the case of Shri Birendra Singh Nirbhay v. ITO Ward-3(1) in ITA No. 704/JPR/2024 the Co-ordinate Bench accepted the genuineness of long -term gains arising out from sale of shares of M/s Channel Nine Entertainment Ltd. and allowed the claim of exemption of the assessee. The relevant retract of the order is reproduced below : On careful consideration of orders of both the lower authority, the bench noted that the issue that has been discussed while confirming / making addition was of the report of the investigation wing wherein the purchases were made from the brokers and there is no reference to the application of made by the public at large on IPO application. The payment of the application money were by an account payee cheque for an amount of Rs. 1,50,000/- drawn on HDFC Bank. There is no finding that the money so paid by normal banking channel has reached in that IPO process. No statement of the broker or that of the entry provider s....
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....scharge there burden that based on the evidence placed on record by the assessee how the gain earned by the assessee be considered as bogus where there is no evidence placed on record on the allegation that has been made by the revenue and thereby merely based on the surmises and conjectures as reported in the investigation report and that too without looking to the facts of the case simply the facts of the investigation report cannot be applied when the facts are totally different. Thus, the long -term capital gain that that is claimed as exempt u/s 10(38) of the Act cannot disbelieved in the hands of the assessee. The assessee has subscribed for equity shares of the Company "Channel Nine Entertainment Limited" and consideration was paid through banking channel and these shares have duly been credited in the Demat account with HDFC Securities Limited. The equity shares so acquired have duly been sold online through Stock Exchange at real time price after paying the Security Transaction Tax (STT). The Company "Channel Nine Entertainment Limited" is listed company, which was active and shares thereof were available for trade online at the time of assessment proceedings itself suffic....
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....n the required market- making obligations could not be fulfilled by the assessee. The assessee subscribed to 2,40,000 equity shares of the CNEL at the issue of Rs. 25/- per share aggregating to Rs. 60,00,000/-and the subscription amount was paid through normal banking channels and shares were duly allotted and credited to the assessee's demat account. There are no discrepancies in the documents filed by the assessee claiming the deduction under section 10(38) of the Act. The Assessing Officer has also observed that the assessee had earned gains as well as suffered losses on the other long -term investment. 10. It is evident from the order that the Revenue accepted the purchases of CNEL but doubted the sale as a bogus sale. The assessee sale the such shares through the recognized stock exchange and filed the relevant documents, demat account and bank account. The revenue cannot adopt the contradictory stand by accepting the purchase as genuine and doubted the sale of the shares. The findings of the Assessing Officer that the assessee started selling the shares once lock in period was over and prices of shares of M/s Chanel Nine entertainment Ltd were artificially rigged to a very....