ASSISTANT COMMISSIONER OF INCOME TAX(OSD), MEERUT vs. TUSHAR GUPTA, MEERUT

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH, ‘B’: NEW DELHI BEFORE MS. MADHUMITA ROY, JUDICIAL MEMBER AND SMT. RENU JAUHRI, ACCOUNTANT MEMBER ITA No.- 1918/Del/2026 [Assessment Year: 2013-14] Assistant Commissioner of Income Tushar Gupta, Tax, 214 A, Ganj Bazar, Meerut Room No. 308A, Aayakar Bhawan, Vs CANTT. Bhainsali Ground Meerut, Uttar Uttar Pradesh-250001. Pradesh-250001. PAN- AFLPG0225P Revenue Assessee C.O. No.- 180/Del/2026 [Arising out of ITA No.- 1918/Del/2026] [Assessment Year: 2013-14] Tushar Gupta, Assistant Commissioner of Income 214 A, Ganj Bazar, Meerut CANTT. Tax, Uttar Pradesh-250001. Vs Room No. 308A, Aayakar Bhawan, Bhainsali Ground Meerut, Uttar Pradesh-250001. PAN- AFLPG0225P Assessee Revenue

Assessee by Shri Piyush Aggarwal, CA Revenue by Shri Rajesh Kumar Dhanesta, Sr. DR Date of Hearing 13.07.2026 Date of Pronouncement 31.07.2026

ITA No.- 1918/Del/2026 and C.O. – 180/Del/2026 Tushar Gupta ORDER Per Renu Jauhri, Accountant Member:

This appeal (ITA No.- 1918/Del/2026) filed by the Revenue and the Cross Objection (C.O. No.- 180/Del/2026) filed by the assessee, are against the order dated 05.12.2025 of the National Faceless Appeal Centre [hereinafter referred to as ‘the Ld. CIT(A)], Delhi, arising out of order dated 30.03.2022, passed by the Assessment Unit, Income-tax Department under Section 147 r.w.s. 144B of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’), pertaining to Assessment Year (A.Y.) 2013-14.

ITA No.- 1918/Del/2026 and C.O. – 180/Del/2026 Tushar Gupta making the assets as short term capital assets not liable for claim for exemption u/s 1 O(38) of the I. T. Act. 5. On facts and circumstances of the case and in law, the CIT(A) has ignored that in the transfer deed, distinctive numbers and share certificate numbers are 89551 to 90150 and 2663 -2674 respectively and whereas in share certificates the same are quite different 88951 to 89550 and 2651 2662, which was not examined by the Ld. CIT(A) during appellate proceedings. 6. That the appellant craves leave to add, modify, amend or delete any of the grounds of appeal at the time of hearing and all the above grounds are without prejudice to each other.

2.1 The assessee has raised the following grounds in C.O. No. 180/Del/2026 of appeal: -

“1. That, on the facts and circumstances of the case and in law, the Ld. CIT(A) has rightly deleted the addition of Rs. 70,61,302/- made under Section 68, since the assessee, being an individual, was not required to maintain books of account. Therefore, the deletion of addition by the Ld. CIT(A) deserves to be upheld. 2. That, on the facts and circumstances of the case and in law, the deletion of the addition relating to the claim of exemption of long-term capital gain of Rs. 70,62,901/- under Section 10(38) is justified, as the shares were purchased through banking channels, held for a period exceeding 12 months, and sold on a recognized stock exchange after payment of STT and purchase of shares was also allowed, Therefore, the deletion of addition by the Ld. CIT(A) deserves to be upheld. 3. That the NFAC erred in assuming jurisdiction under section 151A r.w.s 144B of the I.T. Act, 1961 by issuing notice u/s 142(1) on 30.12.2021 & 22.02.2022 and show cause Notice on 24.03.2022 for 3 conducting faceless assessment prior to the issuance of the notification dated 29/03/2022, which brought the faceless assessment scheme into operation. Consequently, the reassessment order u/s 147 is liable to be held null and void and deserves to be quashed. 4. That the Ld. CIT(A) erred in not adjudicating the legal ground, that the Ld. AO has reopened the assessment u/s 147 only on the borrowed satisfaction. Hence, the impugned assessment order is void ab initio, illegal, unjustifiable, bad in law and liable to be quashed. 5. That the Ld. CIT(A) erred in not adjudicating the legal ground, that in spite of specific requests during assessment proceedings the AO fails to produce the

ITA No.- 1918/Del/2026 and C.O. – 180/Del/2026 Tushar Gupta concerned for cross-examination, so the addition by the AO is illegal, unjustifiable, bad in law and liable to be deleted. 6. That each ground of appeal is without prejudice to each other. That the tax levied, interest charged and the penalty imposed is excessive at any rate. That the appellant craved the right to add, amend and alter any OR all of the grounds of appeal herein and to submit such statements, documents and papers as may be considered necessary either at OR before the appeal hearing.”

3.1 The assessee had purchased 600 shares of M/s Seaview Suppliers Pvt. Ltd. on 26.06.2010 @ Rs. 484/- per shares from a Kolkata based stock broking company M/s Kalimata Tradecom Pvt. Ltd. in respect of which payment of Rs. 2,90,400/- was made on 26.04.2011. The company M/s Seaview suppliers Pvt. Ltd. was amalgamated (along with two other companies) with M/s Access Global Ltd. a listed company, vide order dated 15.11.2011 of the Hon’ble Kolkata High Court. Post amalgamation, M/s Access Global Ltd. allotted its 47 shares for 1 share of M/s Seaview Suppliers Pvt. Ltd. Accordingly, the assessee received 28,200/- shares 4

ITA No.- 1918/Del/2026 and C.O. – 180/Del/2026 Tushar Gupta which were credited to his demat account on 03.03.2012. Subsequently, the assessee sold these shares during 17.12.2012 to 27.12.2012 in 4 lots and received total sale proceeds of Rs. 73,51,682/- through another broker, M/s Prakash Nahata & Co.

3.2 The AO doubted the genuineness of the transactions based on the report of Investigation Wing Kolkata. After considering the assessee’s reply to the show cause notice, he added the sale proceeds of Rs. 70,61,302/- u/s 68 of the Act while finalizing the assessment u/s 147 r.w.s. 144B of the Act vide order dated 30.03.2022.

3.3 Aggrieved, the assessee preferred an appeal before the CIT(A). The CIT(A) held that since the assessee, was not required to maintain books of accounts, therefore, the addition u/s 68 was directed to be deleted. He further, held that since the transactions of sale was carried out through a recognized stock exchange and STT was paid on the said transaction and requisite documentary evidences were also filed by the assessee, the LTCG earned by the assessee on these transactions was exempt u/s 10(38) of the Act.

3.4 Aggrieved with the order of the CIT(A), the Revenue is in appeal before the Tribunal and the assessee has also filed his cross objections raising multiple legal and factual objections.

ITA No.- 1918/Del/2026 and C.O. – 180/Del/2026 Tushar Gupta 3.5 Before us, Ld. DR strongly supported the order of the AO, and pointed out that the transaction in question was a sham transaction. We have also heard Ld. AR at length, who has supported the order of CIT(A). His submissions and the paper book containing documents in support thereof have been taken on record.

Admittedly, the assessee filed return declaring income of Rs. 8,95,930/- under the head income from other sources and declared exempt dividend income of Rs. 6131/- and share profit from partnership firm of Rs. 1,57,922/-. During the reassessment proceedings, he filed return for declaring exempt LTCG at Rs. 70,61,302/- and the details thereof as under:

(i) Date of purchase -26.06.2010 (ii) Name of Co. - M/s Seaview supplier Pvt. Ltd. (iii) Amount for 600 shares @ Rs. 484/- per shares - Rs. 290400/- (iv) Date of payment vide cheque - 26.04.2011 (v) Number of Shares received after amalgamate with M/s Access Global Pvt. Ltd. on 3.03.2012 - 28,200/- (vi) Dates of sales on 17/12,19/12.24/12 & 27/12/2012 (vii) Total sale proceeds received through broker - Rs. 7351682/- & credited in ICICI account

In view of above facts, we are of the view that even if the date of payment by cheque for purchase of shares (i.e. 26.04.2011) is adopted as the date of purchase, the sales having been made after more than 12 months, capital gains have to be considered as long term and therefore exempt u/s 10(38) of the Act.

ITA No.- 1918/Del/2026 and C.O. – 180/Del/2026 Tushar Gupta Ld. CIT(A) in view of the above factual matrix has deleted the addition with the following observations:

“5.5 The Assessing Officer has not disputed the following facts in the Assessment order 1. The shares purchased were held for more than 12 months, 2. The shares of M/s Access Global ltd were received because of Amalgamation 3. Transaction of sale of shares was carried out through recognized stock exchange and; 4. STT was paid on said transaction. 5.6 It is also seen that the Assessing officer has stated that SEBI has levied penalty on M/s Prakash Nahata & co. for one scrip of M/s Ramkrishan Fincap Ltd. and the Assessing Officer has not established any link with the scrip of M/s Access Global Limited in which the assessee has earned Exempt LTCG u/s 10(38).

5.7 It is ascertained that the transactions of purchase of shares in question, holding of shares for more than one year and sale of shares through registered share broker in a recognised stock exchange and payment of Securities Transaction Tax (STT), all were supported by documentary evidences and the Assessing Officer could not point out any specific defect with regard to documents so submitted by assessee. The transaction of sale of shares was carried out through recognized stock exchange and; The STT was paid on said transaction; Therefore, in terms of Section 10(38) of the Act, such income was exempt from tax.”

3.6 We, note the order of Ld. CIT(A) is justified in the facts and circumstances of the case noted hereinbefore and therefore, we do not find any reason to interfere with the same.

ITA No.- 1918/Del/2026 and C.O. – 180/Del/2026 Tushar Gupta 4. In the result, appeal of the revenue is dismissed. Since the Revenue’s appeal stands rejected, the cross objections filed by the assessee need no separate adjudication and the same is also dismissed.

Order pronounced in the open court on 31 .07.2026.

Sd/- Sd/-

[MADHUMITA ROY] [RENU JAUHRI] JUDICIAL MEMBER ACCOUNTANT MEMBER Dated- 31.07.2026. Pooja. Copy forwarded to: 1. Assessee 2. Respondent 3. CIT 4. CIT(A) 5. DR

Asst. Registrar, ITAT, New Delhi,