TaxTMI 
TaxTMI 
2026 (8) TMI 1553
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....pened assessment. 2. That on facts, and in law, the Learned PCIT has grievously erred in holding that short term capital gain of Rs. 62,49,278/- declared by the appellant was required to be added u/s 68 of the Act and taxed u/s 115BBE of the Act. 3. The relevant facts in brief are that the Assessee in the present case is Hindu Undivided Family. The assessment under Section 147 read with Section 144B of the Act was framed on the Assessee for the Assessment Year 2017-2018 vide Assessment Order, dated 27/04/2023. Subsequently, vide Order dated 27/03/2026, passed under Section 263 of the Act the aforesaid Assessment Order was set-aside by the Learned PCIT and the Assessing Officer was directed to pass fresh assessment order. By way of the present appeal the Assessee has challenged the aforesaid Order passed by the Learned PCIT under section 263 of the Act on the grounds reproduced in Paragraph 2 above. 4. When the appeal was taken up for hearing Learned Authorized Representative for the Assessee placed on record decision of Ahmedabad Bench in case of Shama Ajay Patel Vs. The CIT (IT& TP), Ahmedabad: ITA No. 132/AHD/2023, Assessment Year 2017-2018, Dated 26/04/2024) and s....
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....uld have been done is not done and without considering express provisions of the Act, such order needs to be treated as "erroneous". It is apparent from assessment order that AO has not applied his mind regarding applicability of Section 69A of the Act. The payment of tax @ 15% on STCG is a part of the modus operandi to avail accommodation entry therefore, the same can't be considered as a ground to consider the transactions in penny scripts as genuine, which should have been added u/s 68/69A of the I.T Act and should have been taxed @60% u/s. 115BBE. Therefore, I am of the considered opinion that the impugned order was passed by the AO without applying his mind. Thus, this case is covered by clause (a) of Explanation 2 to section 263 reproduced herein above. 16. In view of above discussion, it is found that the assessment order passed by the A.O. u/s 147 r.w.s.144B of the Act dated 27/04/2023 is erroneous and prejudicial to the interest of the revenue on the ground that the accommodation entries in the form of bogus short term capital gain shown by the assessee was required to be added by the A.O. as unexplained income u/s. 68/69A of the ACT read with Section 115BBE o....
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....ng Officer concluded that the Assessee has not earned long term capital gains and had offered to tax short term capital gains of INR.62,49,277/- during the relevant previous year. Therefore, we are of the view that in the facts and circumstances of the present case it cannot be said that the Assessing Officer had failed to carry out necessary enquiry/verification. To the contrary we are of the view that the Assessing Officer had taken a plausible view. We note in the case of Shama Ajay Patel Vs. The CIT(IT & TP) (Supra), relied upon by the Learned Authorised representative for the Assessee during the course of hearing, the Coordinate Bench of the Tribunal had set-aside the order passed under Section 263 of the Act taking note of identical facts and circumstances. The relevant extract of the aforesaid decision of the Tribunal read as under: "11. We have gone through the questionnaires raised by the Assessing Officer during the assessment proceedings and there is no doubt that the Assessing Officer did inquire from the assessee regarding the trading in shares of M/s. Kushal Limited. We have also gone through the reply filed by the assessee to the Assessing Officer placed in ....
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....on of the assessee, but was one of the many transactions entered into by the assessee while trading in shares of various companies - that too through an established broker i.e. M/s. IIFL Securities, and sourced through her NRE account. We see no reason to doubt the genuineness of the transactions as explained by the assessee, nor has the ld. CIT (IT & TP) pointed out any such reason. We have also noted that the assessee has given a detailed explanation and description of the company M/s. Kushal Limited regarding the value of its shares at which sold being justified. The said description of the company was given to the Assessing Officer and also to the ld. CIT (IT & TP), and is placed before us at paper-book page Nos. 45-51. The brief gist of the same is as under............................ 13. The Ld. CIT(IT & TP) has pointed out no fallacy in the justification of price of shares of M/s Kushal Limited by the assessee. The assessee, therefore having justified the value of shares of M/s. Kushal Limited, having The Ab demonstrated the shares to have been traded during the regular course of trading in shares through genuine sources and through an established broker, The Assess....