TARUNA KATARIA,MUMBAI vs. ITO 19(2)(2), MUMBAI

PER OM PRAKASH KANT, AM

This appeal by the assessee is directed against order dated 19.10.2012 passed by the Ld. Commissioner of Income-tax (Appeals)-30, Mumbai [in short ‘the Ld. CIT(A)’] for assessment year 2005-06, raising following grounds:

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b) The learned Commissioner of Income Tax (Appeal) failed b) The learned Commissioner of Income Tax (Appeal) failed b) The learned Commissioner of Income Tax (Appeal) failed to appreciate that appellant has submitted full details of to appreciate that appellant has submitted full details of to appreciate that appellant has submitted full details of Long Term Capital Gain Long Term Capital Gain i.e. Sales Bills, Demat Statements, i.e. Sales Bills, Demat Statements, Broker Notes, Purchase Bills, etc. Broker Notes, Purchase Bills, etc. c) The learned Commissioner of Income Tax (Appeal) ought c) The learned Commissioner of Income Tax (Appeal) ought c) The learned Commissioner of Income Tax (Appeal) ought to have appreciate that appellant has hold the such shares to have appreciate that appellant has hold the such shares to have appreciate that appellant has hold the such shares more than 12 months as required us 10(38) of The Income more than 12 months as required us 10(38) of The Income more than 12 months as required us 10(38) of The Income Tax Act, 196 Tax Act, 1961. d) The learned Commissioner of Income Tax (Appeal) erred d) The learned Commissioner of Income Tax (Appeal) erred d) The learned Commissioner of Income Tax (Appeal) erred in not considering the appellant letter dated 06/09/2011 in not considering the appellant letter dated 06/09/2011 in not considering the appellant letter dated 06/09/2011 NIL dated & 09/08/2012. NIL dated & 09/08/2012. g) The learned Commissioner of Income Tax (Appeal) failed g) The learned Commissioner of Income Tax (Appeal) failed g) The learned Commissioner of Income Tax (Appeal) failed to appreciate that appellant has discharged her onus by to appreciate that appellant has discharged her onus by to appreciate that appellant has discharged her onus by submitting all details as required by the assessing officer submitting all details as required by the assessing officer submitting all details as required by the assessing officer questionnaires dtd questionnaires dtd 07/07/2011. f The learned Commissioner of Income Tax (Appeal) e f The learned Commissioner of Income Tax (Appeal) e f The learned Commissioner of Income Tax (Appeal) erred & confirming the additions on the basis of statement of Mr. confirming the additions on the basis of statement of Mr. confirming the additions on the basis of statement of Mr. M.M. Choksi director of the Company. Choksi director of the Company. 2) The learned Commissioner of Income Tax (Appeal) not 2) The learned Commissioner of Income Tax (Appeal) not 2) The learned Commissioner of Income Tax (Appeal) not considered th considered the Assessing Officer has not given certified Assessing Officer has not given certified copy of the reason recorded & approval obt copy of the reason recorded & approval obtained to the ained to the appellant for verifying the facts, hence assessment appellant for verifying the facts, hence assessment appellant for verifying the facts, hence assessment proceeding are bad in law. proceeding are bad in law. 2. The assessee further modified The assessee further modified its grounds of appeal, of appeal, which are also reproduced as under: also reproduced as under:

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a. Balance Sheet of the assessee for the Assessment a. Balance Sheet of the assessee for the Assessment a. Balance Sheet of the assessee for the Assessment Year 2005 Year 2005-06 wherein investment made in shares 06 wherein investment made in shares were duly recorded and reflected. were duly recorded and reflected. b. b. b. The The The bills bills bills towards towards towards purchase purchase purchase of of of shares shares shares of of of M/s.Goldstar Finvest Pvt. M/s.Goldstar Finvest Pvt. Ltd. c. Bank statement of the assessee maintained with c. Bank statement of the assessee maintained with c. Bank statement of the assessee maintained with Indian Overseas Bank reflecting the payment and Indian Overseas Bank reflecting the payment and Indian Overseas Bank reflecting the payment and receipts towards purchase and sale of shares of M/s. receipts towards purchase and sale of shares of M/s. receipts towards purchase and sale of shares of M/s. Talent Infoways Ltd. Talent Infoways Ltd. d. Copy of share certificates transferred in the name d. Copy of share certificates transferred in the name d. Copy of share certificates transferred in the name of the assessee. of the assessee. e. Copy e. Copy of contract notes issued by M/. Mahasagar of contract notes issued by M/. Mahasagar Securities Securities Securities Pvt.Ltd, Pvt.Ltd, Pvt.Ltd, member member member of of of Bombay Bombay Bombay Stock Stock Stock Exchange having SEBI registration number and code Exchange having SEBI registration number and code Exchange having SEBI registration number and code No.SBI REGN. No. INB No.SBI REGN. No. INB - 230683331/23- -10777 for sale of shares of M/s. Talent Infoways Ltd. sale of shares of M/s. Talent Infoways Ltd. f. Copy of D f. Copy of D-mat statement of the assessee the assessee maintained with Depository Participant M/s. National maintained with Depository Participant M/s. National maintained with Depository Participant M/s. National Securities Services Ltd showing the shares were held Securities Services Ltd showing the shares were held Securities Services Ltd showing the shares were held in D-mat form and delivered to the broker in D mat form and delivered to the broker in D-mat mat form and delivered to the broker in D form. 3. The CIT (A) erred in not appreciating that the above 3. The CIT (A) erred in not appreciating that the above 3. The CIT (A) erred in not appreciating that the above evidences and documents evidences and documents furnished by the assessee were furnished by the assessee were neither found to be false nor fabricated. neither found to be false nor fabricated. 4. The CIT (A) erred in not appreciating that he has doubted 4. The CIT (A) erred in not appreciating that he has doubted 4. The CIT (A) erred in not appreciating that he has doubted genuineness of the transactions on the basis of only letter genuineness of the transactions on the basis of only letter genuineness of the transactions on the basis of only letter received from Director of Income Tax Investigation Wing. received from Director of Income Tax Investigation Wing. received from Director of Income Tax Investigation Wing. However, save and except to the letter issued by Director of er, save and except to the letter issued by Director of er, save and except to the letter issued by Director of Income Tax Investigation Income Tax Investigation - there is nothing brought on there is nothing brought on record by the CIT (A) as to how the investigation report record by the CIT (A) as to how the investigation report record by the CIT (A) as to how the investigation report concerns the assessee and/or shares sold by the assessee. concerns the assessee and/or shares sold by the assessee. concerns the assessee and/or shares sold by the assessee. 5. The CIT (A) erred in not ap 5. The CIT (A) erred in not appreciating that the sale of preciating that the sale of shares was made on online platform of the stock exchange, shares was made on online platform of the stock exchange, shares was made on online platform of the stock exchange, therefore, the assessee did not know the names of the therefore, the assessee did not know the names of the therefore, the assessee did not know the names of the buyers and had no connection and/or relations with any buyers and had no connection and/or relations with any buyers and had no connection and/or relations with any such persons. In such online platform transaction with such persons. In such online platform transaction with such persons. In such online platform transaction with

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Stock Exchange, the seller and buyer cannot know the Exchange, the seller and buyer cannot know the Exchange, the seller and buyer cannot know the names of each other as well as their respective brokers, names of each other as well as their respective brokers, names of each other as well as their respective brokers, who were involved in the trading transaction in the who were involved in the trading transaction in the who were involved in the trading transaction in the secondary platform. In such a situation it cannot be secondary platform. In such a situation it cannot be secondary platform. In such a situation it cannot be presumed that there could be any transfer of ca presumed that there could be any transfer of cash between sh between the buyers and sellers to convert the unaccounted money of the buyers and sellers to convert the unaccounted money of the buyers and sellers to convert the unaccounted money of the beneficiary. the beneficiary. 6. The CIT (A) erred in not appreciating Hon'ble Bombay 6. The CIT (A) erred in not appreciating Hon'ble Bombay 6. The CIT (A) erred in not appreciating Hon'ble Bombay High Court judgement in the case of CIT vs. Lavanya Land High Court judgement in the case of CIT vs. Lavanya Land High Court judgement in the case of CIT vs. Lavanya Land Pvt.Ltd - 297 CTR 0204 (Bom) wherein Hon'ble Bombay 297 CTR 0204 (Bom) wherein Hon'ble Bombay 297 CTR 0204 (Bom) wherein Hon'ble Bombay High Court held that there was no evidence whatsoever to Court held that there was no evidence whatsoever to Court held that there was no evidence whatsoever to allege that the money changed hands between the allege that the money changed hands between the allege that the money changed hands between the assessee and broker or any other person including the assessee and broker or any other person including the assessee and broker or any other person including the alleged exit provider whatsoever to convert unaccounted alleged exit provider whatsoever to convert unaccounted alleged exit provider whatsoever to convert unaccounted money for getting benefit of LTCG as alleged. money for getting benefit of LTCG as alleged. In the said In the said case, the Hon'ble Bombay High Court at para case, the Hon'ble Bombay High Court at para - 21 held that 21 held that in the absence of any material to show that huge cash was in the absence of any material to show that huge cash was in the absence of any material to show that huge cash was transferred from one side to another, addition cannot be transferred from one side to another, addition cannot be transferred from one side to another, addition cannot be sustained, Similar view was Similar view was taken in the following cases. i. Baijnath Baijnath Agarwallla vs. ACIT [2010] 40 SOT 475 Agarwallla vs. ACIT [2010] 40 SOT 475 (Agra Third Member) (Agra Third Member) ii. Ganeshmull Biliay Singh Baid HUF vs. DCIY - IT Ganeshmull Biliay Singh Baid HUF vs. DCIY Ganeshmull Biliay Singh Baid HUF vs. DCIY No.544/Kol/13 dated 4.12.2015 (Kolkata Tribunal) No.544/Kol/13 dated 4.12.2015 (Kolkata Tribunal) No.544/Kol/13 dated 4.12.2015 (Kolkata Tribunal) iii. Malti Ghanshambhai Patodia vs. ITO Malti Ghanshambhai Patodia vs. ITO - - ITA No. 3400/Ahd/2015 (Ahmedabad Tribunal) 3400/Ahd/2015 (Ahmedabad Tribunal) iv. Pratik Pratik Suryakant Suryakant Shah vs. ITO - [2017] [2017] 77 77 taxmann.com 260 (Ahmedabad Tribunal) taxmann.com 260 (Ahmedabad Tribunal) v. Padduchari Padduchari Padduchari Jeevan Jeevan Jeevan Prashant Prashant Prashant Vs. Vs. Vs. ITO ITO ITO - ITA No.452/Hyd/2015 (Hyderabad Tribunal) No.452/Hyd/2015 (Hyderabad Tribunal) vi. Anil Nand Kishore Goyal vs. ACIT Anil Nand Kishore Goyal vs. ACIT - ITA Nos. 1256/PN/2012 (Pune Tribunal) 1256/PN/2012 (Pune Tribunal) vii. CIT CIT vs. vs. Jamna Jamna Devi Devi Agrawal Agrawal - [2012] [2012] 20 20 taxmann.com 529 (Bom HC) mann.com 529 (Bom HC) 7. The CIT (A) erred in not appreciating the entire case of 7. The CIT (A) erred in not appreciating the entire case of 7. The CIT (A) erred in not appreciating the entire case of revenue is based upon the presumption that the assessee revenue is based upon the presumption that the assessee revenue is based upon the presumption that the assessee has ploughed back his own unaccounted money in the form has ploughed back his own unaccounted money in the form has ploughed back his own unaccounted money in the form of bogus LTCG which needs to be corroborated by some of bogus LTCG which needs to be corroborated by some of bogus LTCG which needs to be corroborated by some evidence to establish a link that the assessee had brought to establish a link that the assessee had brought to establish a link that the assessee had brought back his unaccounted income in the form of LTCG. back his unaccounted income in the form of LTCG. back his unaccounted income in the form of LTCG.

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involved in providing involved in providing accommodation entries of accommodation entries of speculation profit/loss profit/loss profit/loss through through through various various various bogus bogus bogus companies companies companies created. created. created. The The The Assessing Officer recorded the reasons to believe recorded the reasons to believe recorded the reasons to believe that income escaped assessment and escaped assessment and accordingly, he issued notice u/s 148 of issued notice u/s 148 of the Act on 25.03.2011. In response to the notice u/s 148 of the Act, the Act on 25.03.2011. In response to the notice u/s 148 of t the Act on 25.03.2011. In response to the notice u/s 148 of t the assessee intimated to treat the return of income filed originally the assessee intimated to treat the return of income filed originally the assessee intimated to treat the return of income filed originally as filed in response to notice u/s 148 of the Act. Subsequently, as filed in response to notice u/s 148 of the Act. Subsequently, as filed in response to notice u/s 148 of the Act. Subsequently, statutory notices along with questionnaire were issued and the statutory notices along with questionnaire were issued and the statutory notices along with questionnaire were issued and the assessment u/s 147 r.w.s. 143(3) of the Act was completed on assessment u/s 147 r.w.s. 143(3) of the Act was co assessment u/s 147 r.w.s. 143(3) of the Act was co 19/12/2011. The Assessing Officer observed 19/12/2011. The Assessing Officer observed the long term capital the long term capital gain shown by the assessee on transfer of shares of the script gain shown by the assessee on transfer of shares of the script gain shown by the assessee on transfer of shares of the script Talent Infoways P. Ltd. Talent Infoways P. Ltd., which was claimed as exempt u/s 10(38) which was claimed as exempt u/s 10(38) of the Act ,but he rejected the claim of long term ca rejected the claim of long term capital gain and rejected the claim of long term ca treated the consideration of Rs. the consideration of Rs.16,60,689/- on transfer of shares of on transfer of shares of Talent Infoways P. Ltd. as unexplained cash credit u/s 68 of the Talent Infoways P. Ltd. as unexplained cash credit u/s 68 of the Talent Infoways P. Ltd. as unexplained cash credit u/s 68 of the Act. On further appeal, the Ld. CIT(A) vide impugned order dated Act. On further appeal, the Ld. CIT(A) vide impugned order dated Act. On further appeal, the Ld. CIT(A) vide impugned order dated 19.10.2012 , also upheld the addition also upheld the addition made by the Assessing by the Assessing Officer. The Ld. CIT(A) also upheld that assessee was not entitled he Ld. CIT(A) also upheld that assessee was not entitled he Ld. CIT(A) also upheld that assessee was not entitled for exemption of the long term capital gain u/s 10(38) of the Act as for exemption of the long term capital gain u/s 10(38) of the Act as for exemption of the long term capital gain u/s 10(38) of the Act as shares were not held for more than 12 months in the ‘demat shares were not held for more than 12 months in the shares were not held for more than 12 months in the account’.

3.1 Before us, the assessee file Before us, the assessee filed a Paper Book containing pages 1 d a Paper Book containing pages 1 to 47 and copy of the decisions relied upon. to 47 and copy of the decisions relied upon.

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4.1 All the remaining grounds i All the remaining grounds including the modified grounds ncluding the modified grounds revolves around the issue of treating the sale consideration received the issue of treating the sale consideration received the issue of treating the sale consideration received on sale of shares of Talent on sale of shares of Talent Infoway Pvt. Ltd. as unexplained cash Infoway Pvt. Ltd. as unexplained cash credit u/s 68 of the Act. The assessee has also challenged the credit u/s 68 of the Act. The assessee has also challenged the credit u/s 68 of the Act. The assessee has also challenged the finding of the lower authorities that mandatory period of 12 months finding of the lower authorities that mandatory period of 12 months finding of the lower authorities that mandatory period of 12 months holding for eligibility of benefit holding for eligibility of benefit for exemption of long term capital exemption of long term capital gain u/s 10(38) of the Act was not fulfilled by the assessee. gain u/s 10(38) of the Act was not fulfilled by the assessee. gain u/s 10(38) of the Act was not fulfilled by the assessee.

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cannot be invoked in the case of the assessee. The Ld. Counsel cannot be invoked in the case of the assessee. The Ld. Counsel cannot be invoked in the case of the assessee. The Ld. Counsel relied on the following relied on the following decisions:

i. CIT v. Orissa Corporati CIT v. Orissa Corporation P. Ltd. (1986) 159 ITR 78 (SC) on P. Ltd. (1986) 159 ITR 78 (SC) ii. ACIT v. K.K. Traders (2017) 83 taxmann.com 350 (Chennai- ACIT v. K.K. Traders (2017) 83 taxmann.com 350 (Chennai ACIT v. K.K. Traders (2017) 83 taxmann.com 350 (Chennai Trib.) iii. CIT v. M/s S.M. Construction (ITA No. 2471/Mum/2016) CIT v. M/s S.M. Construction (ITA No. 2471/Mum/2016) CIT v. M/s S.M. Construction (ITA No. 2471/Mum/2016) iv. CIT v. Bhanwarlal Jain (ITA No. 2997/Mum/2018) CIT v. Bhanwarlal Jain (ITA No. 2997/Mum/2018) CIT v. Bhanwarlal Jain (ITA No. 2997/Mum/2018) 5.1 Secondly, the Ld. Counsel of the assessee submitted th the Ld. Counsel of the assessee submitted that the Ld. Counsel of the assessee submitted th addition in the case of the assessee has been made on the basis of addition in the case of the assessee has been made on the basis of addition in the case of the assessee has been made on the basis of the statement of Shri Mukesh M. Choksi of M/s Mahasagar the statement of Shri Mukesh M. Choksi of M/s Mahasagar the statement of Shri Mukesh M. Choksi of M/s Mahasagar Securities Pvt. Ltd. ( (now known as Alag Securities Pvt. Ltd. now known as Alag Securities Pvt. Ltd.) The Ld. Counsel submitted that mere confessional statement by third Ld. Counsel submitted that mere confessional statement by third Ld. Counsel submitted that mere confessional statement by third party would not be sufficient to hold party would not be sufficient to hold that the assessee the assessee has escaped income. The Ld. Counsel in support of contention relied on the income. The Ld. Counsel in support of contention relied on the income. The Ld. Counsel in support of contention relied on the following decisions:

i. CIT v. Ankit Gupta (2019) CIT v. Ankit Gupta (2019) ii. Chetan H. Gandhi v. ACIT (2016) Chetan H. Gandhi v. ACIT (2016) iii. CIT v. Shree Sai Computers (2015) CIT v. Shree Sai Computers (2015) 5.2 Thirdly, the Ld. Counsel referred to the various modified he Ld. Counsel referred to the various modified he Ld. Counsel referred to the various modified grounds raised and submitted that the transaction of the share sale grounds raised and submitted that the transaction of the grounds raised and submitted that the transaction of the has been carried out has been carried out on online platform of stock exchange where exchange where other, thus, there is seller and buyer didn’t know names of each seller and buyer didn’t know names of each other anonymity of seller and the buyer and in such a situation seller and the buyer and in such a situation seller and the buyer and in such a situation, it cannot be presumed that there would be a transfer of cash between the be presumed that there would be a transfer of cash between the be presumed that there would be a transfer of cash between the buyers and seller buyers and seller for converting unaccounted money of the unaccounted money of the beneficiary. The Ld. Counsel relied on the decision in the case of beneficiary. The Ld. Counsel relied on the decision in the case of beneficiary. The Ld. Counsel relied on the decision in the case of

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CIT vs Lavanya Land Pvt Ltd reported in CIT vs Lavanya Land Pvt Ltd reported in 297 CTR 204 297 CTR 204 (Bombay), wherein it is held that in wherein it is held that in absence of the material to show absence of the material to show that huge cash transferred transferred from one side to another from one side to another, addition cannot be sustained. The Ld. Counsel further submitted that the cannot be sustained. The Ld. Counsel further submitte cannot be sustained. The Ld. Counsel further submitte lower authorities have authorities have sustained the addition based on the sustained the addition based on the presumption that assessee has presumption that assessee has ploughed back unaccounted money ack unaccounted money in the form of bogus long term capital gain but said presumption is in the form of bogus long term capital gain but said presumption is in the form of bogus long term capital gain but said presumption is not corroborated by any evidence corroborated by any evidences. 5.3 Fourthly, the Ld. Counsel submitted that assessee has he Ld. Counsel submitted that assessee has he Ld. Counsel submitted that assessee has neither been provided statement relied upon by the Ld. CIT(A) nor neither been provided statement relied upon by the Ld. CIT(A) nor neither been provided statement relied upon by the Ld. CIT(A) nor any cross-examination examination has been allowed despite repeated request allowed despite repeated request made by the assessee to prove the veracity of those statements and made by the assessee to prove the veracity of those statements and made by the assessee to prove the veracity of those statements and therefore, in absence of any opportunity of cross sence of any opportunity of cross-examination the examination the statement to Shri Mukesh M. Choksi relied upon by the Ld. CIT(A) statement to Shri Mukesh M. Choksi relied upon by the Ld. CIT(A) statement to Shri Mukesh M. Choksi relied upon by the Ld. CIT(A) need to be rejected, following the decisions of the Hon’ble Supreme following the decisions of the Hon’ble Supreme following the decisions of the Hon’ble Supreme Court in the case of Andaman Timber Industries v. CCF 1205 (62 Andaman Timber Industries v. CCF 1205 (62 Andaman Timber Industries v. CCF 1205 (62 taxmann.com 3) (SC). m 3) (SC). 5.4 Fifthly, the Ld. Counsel submitted that finding of the Ld. he Ld. Counsel submitted that finding of the Ld. he Ld. Counsel submitted that finding of the Ld. CIT(A) that assessee held the shares for the period of less than 12 CIT(A) that assessee held the shares for the period of less tha CIT(A) that assessee held the shares for the period of less tha months as required u/s 10(38 months as required u/s 10(38) of the Act without appreciation of ) of the Act without appreciation of facts and law on the issue. The Ld. Counsel refe law on the issue. The Ld. Counsel refe law on the issue. The Ld. Counsel referred to CBDT Circular No. 768 dated 24.06.1998 Circular No. 768 dated 24.06.1998 and submitted that CBDT has and submitted that CBDT has clarified (i) determination of the date of the transfer and determination of the date of the transfer and (ii) the determination of the date of the transfer and period of holding of securities held in dematerialized form and made period of holding of securities held in dematerialized form period of holding of securities held in dematerialized form

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it clear that in case of securities in case of securities the “date of the purchase” of the purchase” is conclusively to be taken from the conclusively to be taken from the broker’s note/contract note and note/contract note and the period of the holding also to be reckoned from the date of the the period of the holding also to be reckoned from the date of the the period of the holding also to be reckoned from the date of the date of the purchase date of the purchase and not for the date of dematerialization. The dematerialization. The Ld. Counsel in support of his co Ld. Counsel in support of his contention relied upon the decision of ntention relied upon the decision of the ITAT Mumbai in ITA No. 5066/Mum/2009 for assessment ITAT Mumbai in ITA No. 5066/Mum/2009 for assessment ITAT Mumbai in ITA No. 5066/Mum/2009 for assessment year 2006-07 in the case of Shri Jafferali K Rattonsey 07 in the case of Shri Jafferali K Rattonsey 07 in the case of Shri Jafferali K Rattonsey.

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30 and 31, which are letters 30 and 31, which are letters issued by the company M/s Talent by the company M/s Talent Infoways Pvt. Ltd. to the assessee Infoways Pvt. Ltd. to the assessee for transfer of share of share certificates. The Ld. CIT(A) has The Ld. CIT(A) has noted that assessee has shown date of the noted that assessee has shown date of the purchase as 24.04.2003 and 28.04.2003 but no evidence regarding purchase as 24.04.2003 and 28.04.2003 but no evidence regarding purchase as 24.04.2003 and 28.04.2003 but no evidence regarding delivery of the shares within 48 hours was given. The Ld. DR delivery of the shares within 48 hours was given. The Ld. DR delivery of the shares within 48 hours was given. The Ld. DR further submitted that on the back side of the share certificate(s), further submitted that on the back side of the share certificate further submitted that on the back side of the share certificate there was no initial was no initial of the assessee. Further there is no of the assessee. Further there is no documentary evidence i.e. postal receipt or courier receipt to show documentary evidence i.e. postal receipt or courier receipt to show documentary evidence i.e. postal receipt or courier receipt to show that when those shares were sent by the assessee to the company those shares were sent by the assessee to the company those shares were sent by the assessee to the company for transfer of name of the assessee. Further for transfer of name of the assessee. Further, there is no evidence there is no evidence as how and when and when the company has returned returned those shares certificates to the assessee to the assessee after change of the name on back side of after change of the name on back side of the share certificate. The Ld. DR further pointed out that quantity the share certificate. The Ld. DR further pointed out that quantity the share certificate. The Ld. DR further pointed out that quantity of the shares purchases is in the bunch of 2000 shares whereas the of the shares purchases is in the bunch of 2000 shares whereas the of the shares purchases is in the bunch of 2000 shares whereas the share certificates are in the bunch of the 5000 shares and such a are in the bunch of the 5000 shares and such a are in the bunch of the 5000 shares and such a split was not possible in those share certificates possible in those share certificates unless unless permitted by the company prior to purchase prior to purchase. The Ld. DR further submitted . The Ld. DR further submitted that in the cases of Mahasagar Securities Pvt. Ltd. the Tribunal has that in the cases of Mahasagar Securities Pvt. Ltd. the Tribunal has that in the cases of Mahasagar Securities Pvt. Ltd. the Tribunal has already held that companies of the said group including the already held that companies of the said group already held that companies of the said group GoldStar finvest ltd ( i.e. the company who has issued purchase invest ltd ( i.e. the company who has issued purchase invest ltd ( i.e. the company who has issued purchase and contract note to the assessee) and contract note to the assessee) were engaged in providing were engaged in providing accommodation entry and accordingly accommodation entry and accordingly 0.15% of the total entries 0.15% of the total entries has considered as the income of those com considered as the income of those companies. The said finding of panies. The said finding of ITAT has become final me final. Further, the Ld. Counsel submitted that the Ld. Counsel submitted that either during assessment proceedings or appellate proceedings assessment proceedings or appellate proceedings, at assessment proceedings or appellate proceedings

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any stage the assessee did not ask for cross any stage the assessee did not ask for cross-examination of Shri examination of Shri Mukesh M. Choksi, though the Ld. Counsel has submitted that though the Ld. Counsel has submitted that such request was made however no documentary evidence in t was made however no documentary evidence in t was made however no documentary evidence in support of the claim support of the claim that such request was ever made before the made before the lower authorities and therefore, such contention of the assessee are lower authorities and therefore, such contention of the assessee are lower authorities and therefore, such contention of the assessee are liable to be discarded. liable to be discarded.

“2.8 I have carefully gone through the assessment carefully gone through the assessment order and the submissions made on behalf of the order and the submissions made on behalf of the order and the submissions made on behalf of the appellant. In this case, the appellant has entered appellant. In this case, the appellant has entered appellant. In this case, the appellant has entered into share transactions through Mukesh Maneklal into share transactions through Mukesh Maneklal into share transactions through Mukesh Maneklal Choksi one of the hawala operators for sale and Choksi one of the hawala operators for sale and Choksi one of the hawala operators for sale and purchase of shares. Sh purchase of shares. Shri M.M. Choksi had admitted ri M.M. Choksi had admitted in his statement recorded u/s. 131 of the I.T. Act, in his statement recorded u/s. 131 of the I.T. Act, in his statement recorded u/s. 131 of the I.T. Act, 1961 before DDIT(Inv), Unit 1961 before DDIT(Inv), Unit-6, Mumbai on 11-12 12- 2009 2009 2009 of of of having having having issued issued issued cheques cheques cheques / / / DDs for DDs for DDs for accommodation entries to various beneficiaries accommodation entries to various beneficiaries accommodation entries to various beneficiaries against the receipt of cash and third part against the receipt of cash and third party cheques y cheques for giving cheques for accommodation entries to the for giving cheques for accommodation entries to the for giving cheques for accommodation entries to the beneficiaries. It was the finding of the Investigation beneficiaries. It was the finding of the Investigation beneficiaries. It was the finding of the Investigation Wing that Shri Mukesh Maneklal Wing that Shri Mukesh Maneklal Choksi with the with the tools of his broking concerns viz M/s. Mahasagar tools of his broking concerns viz M/s. Mahasagar tools of his broking concerns viz M/s. Mahasagar Securities Pvt. Ltd. and its related group Securities Pvt. Ltd. and its related group of 34 odd of 34 odd companies companies was involved in fraudulent billing companies was involved in fraudulent billing was involved in fraudulent billing activities and in the business of providing bogus activities and in the business of providing bogus activities and in the business of providing bogus speculation profit/loss, short term/long term capital speculation profit/loss, short term/long term capital speculation profit/loss, short term/long term capital gains/loss, commodities profit/loss on commodity gains/loss, commodities profit/loss on commodity gains/loss, commodities profit/loss on commodity trading througl, MCX and has been continuing thi trading througl, MCX and has been continuing thi trading througl, MCX and has been continuing this business for many years. Shri Mukesh Mancklal business for many years. Shri Mukesh Mancklal business for many years. Shri Mukesh Mancklal

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Choksi had admitted before the DDIT (Inv.) Unit Choksi had admitted before the DDIT (Inv.) Unit Choksi had admitted before the DDIT (Inv.) Unit-1, Mumbai Mumbai Mumbai that that that one one one of of of the the the beneficiaries beneficiaries beneficiaries for for for accommodation entries is Mrs. Taruna A. accommodation entries is Mrs. Taruna A. Kataria. Kataria. The appellant has earned LTCG by indulging in The appellant has earned LTCG by indulging in The appellant has earned LTCG by indulging in trading of shares of trading of shares of Talent Infoways Ltd. The shares Talent Infoways Ltd. The shares have not been held in the Demat account for a have not been held in the Demat account for a have not been held in the Demat account for a period of 12 months or more, The transaction of period of 12 months or more, The transaction of period of 12 months or more, The transaction of- purchase of these shares have not been done purchase of these shares have not been done purchase of these shares have not been done through stock exchange. Shri Mukesh Choksi, the through stock exchange. Shri Mukesh Choksi, the through stock exchange. Shri Mukesh Choksi, the Director of Mahasagar Securities Pvt. Director of Mahasagar Securities Pvt. Ltd has Ltd has categorically categorically categorically admitted admitted admitted that that that M/s. M/s. M/s. Mahasagar Mahasagar Mahasagar Securities Put. Ltd was engaged in the business of Securities Put. Ltd was engaged in the business of Securities Put. Ltd was engaged in the business of providing accommodation entries in the nature of providing accommodation entries in the nature of providing accommodation entries in the nature of bogus |LTCG.The ITAT vide its order dated 29 bogus |LTCG.The ITAT vide its order dated 29-08 08- 2008 in its No. 2008 in its No. 462/Mum/2005 for the A.Y. 2002- -03 in the case of M/S. case of M/S. Mahasagar Securities Pvt. Ltd. Mahasagar Securities Pvt. Ltd. has accepted this claim and declared the company has accepted this claim and declared the company has accepted this claim and declared the company as an entry. provider and ordered that its income as an entry. provider and ordered that its income as an entry. provider and ordered that its income should be computed @, 0. 15% of total entries should be computed @, 0. 15% of total entries should be computed @, 0. 15% of total entries provided by this company. Further, as per the provided by this company. Further, as per the provided by this company. Further, as per the information made avai information made available by the Investigation lable by the Investigation Wing, the appellant has indulged herself in bogus Wing, the appellant has indulged herself in bogus Wing, the appellant has indulged herself in bogus share transactions of Talent Infoways Ltd. In view share transactions of Talent Infoways Ltd. In view share transactions of Talent Infoways Ltd. In view of the above, the A.. treated the LTCG earned from of the above, the A.. treated the LTCG earned from of the above, the A.. treated the LTCG earned from share transactions of Talent Infoways Ltd. to the share transactions of Talent Infoways Ltd. to the share transactions of Talent Infoways Ltd. to the tune of Rs. 16,60,689 / tune of Rs. 16,60,689 / - as bogus transactions and s bogus transactions and accordingly treated the sum of Rs. 16,60,689 / accordingly treated the sum of Rs. 16,60,689 / - as unexplained investment of the appellant within the unexplained investment of the appellant within the unexplained investment of the appellant within the meaning of section 68 of the I.T. Act and added the meaning of section 68 of the I.T. Act and added the meaning of section 68 of the I.T. Act and added the same to the total income of the appellant. The A.O. same to the total income of the appellant. The A.O. same to the total income of the appellant. The A.O. also mentioned in the as also mentioned in the assessment order that the sessment order that the provisions of Section 292(c) of the I.T. provisions of Section 292(c) of the I.T. Act inserted to inserted to the Act with retrospective effect from 01 the Act with retrospective effect from 01-04-1970 1970 casts onus upon assessee to explain all the material onus upon assessee to explain all the material onus upon assessee to explain all the material gathered and seized in course of search action Wis. gathered and seized in course of search action Wis. gathered and seized in course of search action Wis. 132 or survey u/s. 132 or survey u/s. 133A of the I.T. Act. 2.9 In view of the above discussion, I find that the 2.9 In view of the above discussion, I find that the 2.9 In view of the above discussion, I find that the A.O. is quite justified in holding that the appellant A.O. is quite justified in holding that the appellant A.O. is quite justified in holding that the appellant has entered into bogus transactions of purchase and has entered into bogus transactions of purchase and has entered into bogus transactions of purchase and sale of shares and therefore, has rightly made sale of shares and therefore, has rightly made sale of shares and therefore, has rightly made addition of Rs. 16,60,689/ addition of Rs. 16,60,689/- being unexplained eing unexplained investment W/s. 68 of the I.T. Act. As regards to the investment W/s. 68 of the I.T. Act. As regards to the investment W/s. 68 of the I.T. Act. As regards to the

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case laws cited by the Ld. AR, the same were found case laws cited by the Ld. AR, the same were found case laws cited by the Ld. AR, the same were found to be distinguishable on facts. Further, the A.O. has to be distinguishable on facts. Further, the A.O. has to be distinguishable on facts. Further, the A.O. has made the addition on account of unexplained made the addition on account of unexplained made the addition on account of unexplained investment and therefore, the plea o investment and therefore, the plea of the appellant f the appellant that no addition can be made u/s. 68 doesn't hold that no addition can be made u/s. 68 doesn't hold that no addition can be made u/s. 68 doesn't hold much of ground. The same is reiected. The addition much of ground. The same is reiected. The addition much of ground. The same is reiected. The addition so made by the A.O. is accordingly confirmed. The so made by the A.O. is accordingly confirmed. The so made by the A.O. is accordingly confirmed. The grounds of appeal are dismissed. grounds of appeal are dismissed.” 7.1 Before us, the assessee has referred to copy of pur Before us, the assessee has referred to copy of pur Before us, the assessee has referred to copy of purchase contract notes (PB- 6, 8 and 10), purchase bills (PB 5, 7 and 9), (PB 5, 7 and 9), Sales contract notes (PB 12, 15, 16, 19 and 20), sales bills (PB 11, (PB 12, 15, 16, 19 and 20), sales bills (PB 11, 13, 14, 17 and 18) copy of share certificates (PB 21 to 29) copy of 13, 14, 17 and 18) copy of share certificates (PB 21 to 29) copy of 13, 14, 17 and 18) copy of share certificates (PB 21 to 29) copy of demat statement (PB 32), copy of bank passbook demat statement (PB 32), copy of bank passbook and and balance sheet (PB 39, 40). The assessee has also filed copy of receipt issued by the (PB 39, 40). The assessee has also filed copy of receipt issued by (PB 39, 40). The assessee has also filed copy of receipt issued by Goldstar Finvest Pvt. Ltd. i.e. Goldstar Finvest Pvt. Ltd. i.e. receipt of Rs.270/- against bill No. CC/2003/207/87 dated 24.04.2003 and Rs.17,498/- against bill CC/2003/207/87 dated 24.04.2003 and Rs.17,498/ CC/2003/207/87 dated 24.04.2003 and Rs.17,498/ No.CC/2003/080/34 dated 28.04.2003, i C/2003/080/34 dated 28.04.2003, in support of purchase of n support of purchase of shares of M/s Talent Infoway Pvt. Ltd. in cash. However, the of M/s Talent Infoway Pvt. Ltd. in cash. However, the of M/s Talent Infoway Pvt. Ltd. in cash. However, the company Goldstar Finvest Pvt. Ltd. was operated by Mr. Mukesh M. company Goldstar Finvest Pvt. Ltd. was operated by Mr. Mukesh M. company Goldstar Finvest Pvt. Ltd. was operated by Mr. Mukesh M. Choksi who during the course of the search by the Income-tax Choksi who during the course of the search by the Income Choksi who during the course of the search by the Income Department admitted that companies operated by him were Department admitted that companies operated Department admitted that companies operated engaged in providing accommodation entries only without any real engaged in providing accommodation entries only without any real engaged in providing accommodation entries only without any real transactions.

7.2 In the instant case, i In the instant case, in view of the discrepancies pointed out n view of the discrepancies pointed out by the AO in the documents filed by the assessee in the documents filed by the assessee, he asked , he asked the assessee to discharge to discharge her onus of establishing genuineness of stablishing genuineness of transactions, however, however, however, neither neither neither the the the assessee assessee assessee produced produced produced any any any

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confirmation from M/s Goldstar Finvest Pvt. Ltd. nor produced said confirmation from M/s Goldstar Finvest Pvt. Ltd. nor produce confirmation from M/s Goldstar Finvest Pvt. Ltd. nor produce party before the Assessing Officer party before the Assessing Officer for verification. Thus, the claim of Thus, the claim of the assessee that it has discharged its onus of establishing that it has discharged its onus of establishing that it has discharged its onus of establishing genuineness of the transaction, transaction, has not been fulfilled due to the has not been fulfilled due to the reasons that firstly, the assessee did not file any confirmation fr , the assessee did not file any confirmation fr , the assessee did not file any confirmation from the said party i.e. M/s Goldstar the said party i.e. M/s Goldstar Finvest p Ltd that the assessee Finvest p Ltd that the assessee carried out actual transactions of the purchase of shares of M/s d out actual transactions of the purchase of shares of M/s d out actual transactions of the purchase of shares of M/s Talent infoway Private Limited in the month of April, 2003. Talent infoway Private Limited in the month of Talent infoway Private Limited in the month of Secondly, the assessee the assessee did not justify as why initials of the did not justify as why initials of the assessee were absent on the backside of the share certificates. In assessee were absent on the backside of the share certificates. In assessee were absent on the backside of the share certificates. In such circumstances, the Assessing Officer asked the assessee to cumstances, the Assessing Officer asked the assessee to cumstances, the Assessing Officer asked the assessee to produce the said party for verification of the genuineness of the produce the said party for verification of the genuineness of the produce the said party for verification of the genuineness of the claim of the assessee, then onus shifted to the assessee, but the claim of the assessee, then onus shifted to the assessee, but the claim of the assessee, then onus shifted to the assessee, but the assessee did not make any attempt to comply the queries raised by assessee did not make any attempt to comply the queries raised by assessee did not make any attempt to comply the queries raised by the Assessing Officer. The decision relied upon by the learned e Assessing Officer. The decision relied upon by the learned e Assessing Officer. The decision relied upon by the learned counsel of the assessee relating to discharging of the onus are counsel of the assessee relating to discharging of the onus are counsel of the assessee relating to discharging of the onus are accordingly distinguishable and not applicable over the facts of the accordingly distinguishable and not applicable over the facts of the accordingly distinguishable and not applicable over the facts of the instant case. In the case of CIT Vs Orrisa Corporation P Ltd ( In the case of CIT Vs Orrisa Corporation P Ltd ( In the case of CIT Vs Orrisa Corporation P Ltd (supra), the assessee provided confirmation of the parties before the the assessee provided confirmation of the parties before the the assessee provided confirmation of the parties before the Assessing Officer and also provided complete name and address of Assessing Officer and also provided complete name and address of Assessing Officer and also provided complete name and address of those parties and requested for issue of the summon for enforcing those parties and requested for issue of the summon for enforcing those parties and requested for issue of the summon for enforcing their attendance, but in the instant case the assessee but in the instant case the assessee but in the instant case the assessee has neither filed confirmation from M/s Gold iled confirmation from M/s GoldStar Finvest P Ltd , Finvest P Ltd , nor made any request for enforcing their attendance. In the c request for enforcing their attendance. In the case of KK Traders ase of KK Traders (supra), the Tribunal found the explanation of the assessee ribunal found the explanation of the assessee ribunal found the explanation of the assessee

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plausible and supported by the evidence, whereas in the instant plausible and supported by the evidence, whereas in t plausible and supported by the evidence, whereas in t case, the documents filed by the assessee do not give confidence of case, the documents filed by the assessee do not give confidence of case, the documents filed by the assessee do not give confidence of genuineness of the transaction. Similar is the finding in the case of genuineness of the transaction. Similar is the finding in the case of genuineness of the transaction. Similar is the finding in the case of SM Construction (supra) and Bhanwarlal Jain (supra) relied upon SM Construction (supra) and Bhanwarlal Jain (supra) relied upon SM Construction (supra) and Bhanwarlal Jain (supra) relied upon by the assessee. The ratio of the above dec by the assessee. The ratio of the above decisions is therefore not isions is therefore not applicable over the facts of the instant case. the facts of the instant case.

7.3 The second contention of the assessee The second contention of the assessee is that that the Assessing Officer has relied mainly on the confessional statement of third- Officer has relied mainly on the confessional statement of third Officer has relied mainly on the confessional statement of third party. In our opinion, opinion, the Assessing Officer has allow the Assessing Officer has allowed the opportunity to the assessee to discharge her onus of establishing opportunity to the assessee to discharge her onus of establishing opportunity to the assessee to discharge her onus of establishing the genuineness of the transaction and in view of the failure on the the genuineness of the transaction and in view of the failure on the the genuineness of the transaction and in view of the failure on the part of the assessee, the Assessing Officer has also referred to the part of the assessee, the Assessing Officer has also referred to the part of the assessee, the Assessing Officer has also referred to the information gathered which was duly confronte information gathered which was duly confronted to the assessee. d to the assessee. The addition has been not The addition has been not made merely on statement of the third statement of the third- party, but also in view of the failure of the assessee in discharging party, but also in view of the failure of the assessee in discharging party, but also in view of the failure of the assessee in discharging its onus laid down under section 68 of the A d down under section 68 of the Act. We accordingly ct. We accordingly reject the contention of the assessee. reject the contention of the assessee. The decisions s relied upon by the assessee are therefore not applicable over the facts of the therefore not applicable over the facts of the therefore not applicable over the facts of the instant case and accordingly distinguishable. instant case and accordingly distinguishable. 7.4 The third contention of the assessee contention of the assessee is that there that there were no evidence on record to support transfer of evidence on record to support transfer of cash from the assessee to cash from the assessee to M/s GoldStar finvest private Limited. The learned counsel of the invest private Limited. The learned counsel of the invest private Limited. The learned counsel of the assessee has relied on the decision of L has relied on the decision of Lavnya Land P Ltd (supra). In avnya Land P Ltd (supra). In said case allegations were case allegations were of regarding cash payments to sellers of regarding cash payments to sellers of

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the land based on seized doc the land based on seized documents but no enquiry was carried out uments but no enquiry was carried out by the AO or statement was recorded from the vendors of or statement was recorded from the vendors of or statement was recorded from the vendors of the land in different villages and the T in different villages and the Tribunal concluded that addition could ribunal concluded that addition could not be sustained. In background of not be sustained. In background of those facts, Hon’ble , Hon’ble High Court held that finding was mixed one and there was no substantial was mixed one and there was no substantial was mixed one and there was no substantial question of law arising from such orders. In our opinion, ratio of the question of law arising from such orders. In our opinion, ratio of the question of law arising from such orders. In our opinion, ratio of the said decision is not applicable over facts of the instant case. In this said decision is not applicable over facts of the instant case. In this said decision is not applicable over facts of the instant case. In this case the assessee was primarily required to discharge its onus case the assessee was primarily required to discharge its onus case the assessee was primarily required to discharge its onus under section 68 of the A ction 68 of the Act, and in failure on the part of the ct, and in failure on the part of the assessee in doing so, the Assessing Officer is justified in making the assessee in doing so, the Assessing Officer is justified in making the assessee in doing so, the Assessing Officer is justified in making the addition.

7.5 Fourthly, the assessee has contended that no cross , the assessee has contended that no cross- , the assessee has contended that no cross examination of Sh Mukesh Chokasi has been provided to the examination of Sh Mukesh Chokasi has been provided to the examination of Sh Mukesh Chokasi has been provided to the assessee. The departmental representative submitted that no such The departmental representative submitted that no such The departmental representative submitted that no such cross-examination was sought before the lower examination was sought before the lower authorities. authorities. Before us, the assessee has not produced any evidence to support that she us, the assessee has not produced any evidence to support that she us, the assessee has not produced any evidence to support that she sought cross-examination of Shri Mukesh M. Choksi before lower examination of Shri Mukesh M. Choksi before lower examination of Shri Mukesh M. Choksi before lower authorities and therefore, the decisions relied upon in the case of authorities and therefore, the decisions relied upon in the case of authorities and therefore, the decisions relied upon in the case of Andaman Timber Industries Ltd. (supra) is not applicable over the Andaman Timber Industries Ltd. (supra) is not applicable over the Andaman Timber Industries Ltd. (supra) is not applicable over the facts of the case.

7.6 Further on verification of the purchase contract note Further on verification of the purchase contract note Further on verification of the purchase contract note available on PB-8, we find that assessee 8, we find that assessee has purchased the shares M/s has purchased the shares M/s Talent Infoway Pvt. Ltd. by way of orders placed on 24.04.2003. The Talent Infoway Pvt. Ltd. by way of orders placed on 24.04.2003. The Talent Infoway Pvt. Ltd. by way of orders placed on 24.04.2003. The

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relevant part of the contract note showing the purchase by the relevant part of the contract note showing the purchase by the relevant part of the contract note showing the purchase by the different order is reproduced as under: different order is reproduced as under:

7.7 Thus the contract note shows the quantity of bunch of 2000 Thus the contract note shows the quantity of bunch of 2000 Thus the contract note shows the quantity of bunch of 2000 shares whereas the share certificates are in the bunch of the 5000 shares whereas the share certificates are in the bunch of the 5000 shares whereas the share certificates are in the bunch of the 5000 shares available on page 21, 22, 24 and 25 available on page 21, 22, 24 and 25 shows that same are shows that same are composite share certificate for 5000 shares and composite share certificate for 5000 shares and the assessee has the assessee has not given any explanation as how it was possible for placing any explanation as how it was possible for placing any explanation as how it was possible for placing separate orders for purchase of the shares in the quantity of less separate orders for purchase of the shares in the quantity of less separate orders for purchase of the shares in the quantity of less than 5000. The assessee than 5000. The assessee has also not explained non on-compliance of section 13 of Security ecurity Contract (regulation) Act,1956 ,1956.

7.8 Further, we find that on the back side of the share certificates er, we find that on the back side of the share certificates er, we find that on the back side of the share certificates (i.e. available on PB 21 to 29 available on PB 21 to 29 )there are no initials of the assessee there are no initials of the assessee against the relevant column for initials. Further, there is no against the relevant column for initials. Further, against the relevant column for initials. Further, evidence on record as as how and when the share certificates were the share certificates were sent to the company company for entering the name of the assessee as share for entering the name of the assessee as share holder and how and when and when the company has returned returned back those share certificates to the assessee. In absence of such documentary share certificates to the assessee. In absence of such documentary share certificates to the assessee. In absence of such documentary

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evidences, it can’t be established that those evidences, it can’t be established that those shares were actu shares were actually purchased in cash by the assessee on purchased in cash by the assessee on 24.4.2003 & 24.4.2003 & 28.04.2003. Without confirmation of purchase, the sale also becomes non- Without confirmation of purchase, the sale also becomes non Without confirmation of purchase, the sale also becomes non reliable. The caselaws relied upon by the assessee are laws relied upon by the assessee are laws relied upon by the assessee are in facts of the each and every case and cannot be applied without comparing the each and every case and cannot be applied without comparin each and every case and cannot be applied without comparin facts of the said case. In the case of Shri Jafferali K Rattonsey Shri Jafferali K Rattonsey facts of the said case. In the case of (supra) the Tribunal has deleted the addition holding the double the Tribunal has deleted the addition holding the double the Tribunal has deleted the addition holding the double speaking by Shri Mukesh M. Choksi during the cross-examination speaking by Shri Mukesh M. Choksi during the cross speaking by Shri Mukesh M. Choksi during the cross whereas in the instant case no such facts are whereas in the instant case no such facts are in existen in existence. In the case case case of of of Shri Shri Shri Vineet Vineet Vineet Sureshchandra Sureshchandra Sureshchandra Agarwal Agarwal Agarwal in in in ITA ITA ITA No. No. No. 1442/Ahd/2013 for AY 2005 1442/Ahd/2013 for AY 2005-06 the Tribunal Bench Ahmedabad 06 the Tribunal Bench Ahmedabad has followed the finding of the Co has followed the finding of the Co-ordinate Bench of the Tribunal in ordinate Bench of the Tribunal in the case of Shri Jafferali K Rattonsey (supra) therefore, the ratio of the case of Shri Jafferali K Rattonsey (supra) therefore, the rat the case of Shri Jafferali K Rattonsey (supra) therefore, the rat the said case is also not applicable over the facts of the instant the said case is also not applicable over the facts of the instant the said case is also not applicable over the facts of the instant case.

7.9 We find that, the Assessing Officer has duly noted that We find that, the Assessing Officer has duly noted that We find that, the Assessing Officer has duly noted that Tribunal in the case of Goldstar Finvest Pvt. Ltd. along with other Tribunal in the case of Goldstar Finvest Pvt. Ltd. along with other Tribunal in the case of Goldstar Finvest Pvt. Ltd. along with other companies of M/s Mahasagar Securities companies of M/s Mahasagar Securities ( ITA No. 462/Mum/2005 462/Mum/2005 for AY 2002-03 ) has held that those companies were engaged in has held that those companies were engaged in has held that those companies were engaged in providing accommodation entries against a commission receipt @ providing accommodation entries against a commission receipt @ providing accommodation entries against a commission receipt @ 0.15%. In view of the said finding there is no doubt left that 0.15%. In view of the said finding there is no doubt left that 0.15%. In view of the said finding there is no doubt left that purchase and sale bills issued by Goldstar Finvest Pvt bills issued by Goldstar Finvest Pvt bills issued by Goldstar Finvest Pvt. Ltd. to the assessee are bogus and not reliable. assessee are bogus and not reliable. The payment receipt The payment receipt produced by the assessee for those purchases are without any confirmation by the assessee for those purchases are without any confirmation by the assessee for those purchases are without any confirmation

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by those parties and cannot be relied and cannot be relied upon to support purchase of upon to support purchase of shares of Talent Infoways p Ltd by the assess shares of Talent Infoways p Ltd by the assessee. ee. As far as sale transaction of the shares of M/s Talent Infoway Pvt. Ltd. is transaction of the shares of M/s Talent Infoway Pvt. Ltd. is transaction of the shares of M/s Talent Infoway Pvt. Ltd. is concerned the contention of the assessee that those transaction concerned the contention of the assessee that those transaction concerned the contention of the assessee that those transaction have been carried out on carried out on stock exchange , so there is anonymity of there is anonymity of sales as well as purchase party, purchase party, we find that in such at in such type of bogus accommodation entry sales accommodation entry sales, there is a set of buyers who want to there is a set of buyers who want to take entries of bogus loss and whenever any sales of such penny take entries of bogus loss and whenever any sales of such penny take entries of bogus loss and whenever any sales of such penny stock companies are transacted from the stock market, no genuine stock companies are transacted from the stock market stock companies are transacted from the stock market buyer will buy those shares will buy those shares and only exit providers i.e. persons who and only exit providers i.e. persons who want to take loss and already in loop of the entire and already in loop of the entire process , will and already in loop of the entire come forward and bu uy those shares. Thus, the contentions . Thus, the contentions of the assessee that there is anonymity of the buyer and seller is not assessee that there is anonymity of the buyer and seller is not assessee that there is anonymity of the buyer and seller is not applicable in the c applicable in the case of such arranged and preplanned arranged and preplanned transactions.

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Order pronounced in the open Court on nounced in the open Court on 24/08/2023. /08/2023. Sd/- Sd/ Sd/- (NARENDER KUMAR CHOUDHRY NARENDER KUMAR CHOUDHRY) (OM PRAKASH KANT OM PRAKASH KANT) JUDICIAL MEMBER JUDICIAL MEMBER ACCOUNTANT MEMBER ACCOUNTANT MEMBER Mumbai; Dated: 24/08/2023 Rahul Sharma, Sr. P.S. Copy of the Order forwarded to Copy of the Order forwarded to : 1. The Appellant 2. The Respondent. 3. CIT 4. DR, ITAT, Mumbai 5. Guard file. BY ORDER, BY ORDER, //True Copy// (Assistant Registrar) (Assistant Registrar) ITAT, Mumbai ITAT, Mumbai