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Income Tax Appellate Tribunal, “G” BENCH, MUMBAI
Before: SHRI PAVAN KUMAR GADALE & SHRI GAGAN GOYAL
Appellant by : None Respondent by : Shri. Dr.Kishore Dhule. CIT DR Date of Hearing 09.10.2023 Date of Pronouncement 11.10.2023 आदेश / O R D E R
PER PAVAN KUMAR GADALE JM:
1. The assessee has filed the appeal against the order of the National Faceless Appeal Centre (NFAC), Delhi /CIT (A) passed u/sec 143(3) and U/sec 250 of the Act. The assessee has raised the following grounds of appeal:
On the facts and circumstances of the case, the Assessment order passed u/s 143(3) by the learned assessing officer is undated, thereby the Assessment order loses its significance and is bad in law and void ab initio. Surekha Arvind Jain, Mumbai.
2. The learned Assessing Officer erred in treating the Sale of Shares made through a recognized Stock Exchange as accommodation entries and accordingly making an addition of Rs.98,37,400/-u/s.68 of the Income Tax Act
The learned Assessing Officer erred in placing reliance on irrelevant considerations which had no bearing on the Sale of Shares made by the appellant on the recognized Stock Exchange.
The learned Assessing Officer erred in relying upon certain Reports of DDIT(Inv.), Kolkata without even giving the copy of the same to the appellant for the purpose of rebutting the same and therefore the same could not have been considered for the purpose of concluding addition u/s.68.
The learned Assessing Officer erred in making further addition of Rs.2,95,122/- u/s.69C of the I.TAct being 3% of the above sales consideration of the shares under the presumption that the appellant would have paid such a Commission for obtaining the accommodation entries.
The brief facts of the case are that, the assessee is an individual and has filed the return of income for the A.Y 2015-16 on 21.01.2016 disclosing a total income of Rs.30,91,170/- and the return of income was processed u/s 143(1) of the Act. Subsequently the case was selected for scrutiny and notice u/sec 143(2) and U/sec 142(1) of the Act were issued. In Surekha Arvind Jain, Mumbai. compliance to the notice, the Ld. AR of the assessee submitted the details. The Assessing Officer (AO) on perusal of the financial statements found that during the year under consideration the assessee has traded in the penny stock of PS IT Infrastructure and Service(formerly known as shilp investments Ltd) and has disclosed the long term capital gains of Rs.96,50,940/- and has exempted U/sec10(38) of the Act. Whereas the assessee has purchased the 15000 shares of Rs.10/- of Crescent Digital Technologies Pvt Ltd on 22.03.2012 from M/s Octopus Infotel Pvt Ltd for a consideration of Rs.1,50,000/-, subsequently M/s Crescent Digital Technologies Pvt Ltd was merged with PS IT Infrastructure & Services (formerly known as Parag Shilp Investment Ltd) vide High Court of Bombay order dated 03.05.2013 and the shares of PS IT Infrastructure & Services are credited to demat account of assessee on 28.12.2012. Further the assessee has sold 3,000 shares on 25.08.2014 for a consideration of Rs.17,65,088/- and 12000 remaining shares were split into 1,20,000 shares of face value of Rs.1/- each and resulting shares were sold between 16.09.2014 to 22.10.2014 for a total consideration of Surekha Arvind Jain, Mumbai. Rs.80,33,552/-.The AO dealt on the various facts of transactions, modus operandi and the report of the kolkata investigation wing and the statement of persons and has doubted the earning of Long Term Capital Gains. The A.O find that there is a no correlation of the price rise and fall of the share price and was not satisfied with the explanations and material information and observed that the transactions are not genuine and made addition as unexplained cash credit u/s 68 of the Act of Rs.98,37,400/-andestimated unexplained expenditure U/sec 69C of the Act of Rs.2,95,122/- and assessed the total income of Rs.1,32,23,690/- and passed order U/sec143(3)of the Act dated 2-1-2018.
3. Aggrieved by the order, the assessee has filed an appeal before the CIT(A),whereas the CIT(A) has considered the grounds of appeal, statement of facts and findings of the AO and has issued notices of hearing and since there was no compliance by the assessee to notices. Therefore the CIT(A) considering the information on record has confirmed the action of the A.O and dismissed the appeal. Aggrieved by the Surekha Arvind Jain, Mumbai. order of the CIT(A), the assessee has filed an appeal before the Hon’ble Tribunal.