DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE - 4(2), KOLKATA, KOLKATA vs. ROYAL SECURITIES LIMITED, KOLKATA

आयकर अपील�य अ�धकरण, कोलकाता पीठ “डी’’, कोलकाता IN THE INCOME TAX APPELLATE TRIBUNAL “D” BENCH: KOLKATA �ी राजेश कुमार, लेखा सट�य एवं �ी �द�प कुमार चौबे, �या�यक सद�य के सम� [Before Shri Rajesh Kumar, Accountant Member & Shri Pradip Kumar Choubey, Judicial Member] I.T.A. No. 2327Kol/2025 Assessment Year: 2016-17 DCIT, Central Circle-4(2), Kolkata Vs. Royal Securities Limited

(PAN: AABCR 4740 E) ( अपीलाथ� ) Respondent / ��यथ� Appellant / C.O. No. 93/Kol/2025 (Arising out of I.T.A. No. 2327Kol/2025) Assessment Year: 2016-17 Royal Securities Limited Vs. DCIT, Central Circle-4(2), Kolkata

(PAN: AABCR 4740 E) Cross-objector Respondent / ��यथ�

Date of Hearing / सुनवाई 25.06.2026 क� �त�थ Date of Pronouncement/ 10.07.2026 आदेश उ�घोषणा क� �त�थ For the Appellant/ Shri A.K. Tulsiyan, FCA �नधा�रती क� ओर से Shri Rabin Maheshwari, ACA For the Respondent/ Shri Sanat Kumar Raha, CITDR राज�व क� ओर से

2 I.T.A. No.2327/Kol/2025 CO No. 93/Kol/2025 Assessment Year: 2016-17 Royal Securities Limited ORDER / आदेश Per Rajesh Kumar, AM: This is an appeal preferred by the Revenue and the cross objection by the assessee against the order of the Ld. Commissioner of Income Tax (Appeals)-27, Kolkata (hereinafter referred to as the “Ld. CIT(A)”] dated 23.04.2025 for the AY 2016-17.First we shall adjudicate the cross objection of the assessee in CO NO. 93/Kol/2025 for AY 2016-17 in which the assessee has raised legal issue.

3 I.T.A. No.2327/Kol/2025 CO No. 93/Kol/2025 Assessment Year: 2016-17 Royal Securities Limited April, 2021 as per the provision in the Act as they stood immediately before commencement of Finance Act, 2021. The ld. A.R submitted that as per Section 149(1)(b) , no notice u/s 148 shall be issued after four year but more than six years has elapsed from the end of relevant assessment year unless the income chargeable to tax which has escaped assessment amounts to or is likely to amounting to one lakh rupees or above. The Ld. A.R therefore prayed that the notice has been issued beyond the period of six years from the end of relevant assessment year and is therefore barred by limitation. The Ld. A.R therefore prayed that notice as well as consequent assessment framed are bad in law and nullity in the eyes of law and quashed.

“(b) if four years, but not more than six years, have elapsed from the end of the relevant assessment year unless the income chargeable to tax which has escaped assessment amounts to or is likely to amount to one lakh rupees or more for that year.” For the sake of ready reference, we also extract the proviso to section 149(1)(b) as was applicable prior to 01.04.2021 as under:

“Provided that no notice under Section 148 shall be issued at any time in a case for the relevant assessment year beginning on or before 1st day of April, 2021, if [a notice under section 148 or section 153A or section 153C could not have been issued at that time on account of being beyond the time limit specified under the provisions of clause (b) of sub- Section (1) of this section or section 153A or section 153C, as the case may be], as they stood immediately before the commencement of the Finance Act, 2021.” A perusal of the first proviso to Section 149(1)(b) and also the provision of Section 149(1)(b) as were applicable prior to the commencement of Finance Act, 2021, we observe that notice was issued u/s 148 within a period of six years from the end of

4 I.T.A. No.2327/Kol/2025 CO No. 93/Kol/2025 Assessment Year: 2016-17 Royal Securities Limited relevant assessment year. However, the same was issued beyond six years and therefore is barred by limitation. Consequently the assessment framed by the AO is also invalid and nullity and is accordingly quashed.

5 I.T.A. No.2327/Kol/2025 CO No. 93/Kol/2025 Assessment Year: 2016-17 Royal Securities Limited 54/Kol/2022 dated 14.09.2023 and DCIT vs. Dollar Holding Pvt. Ltd. in ITA No. 1729/Kol/2024 dated 11.02.2025 and thus confirmed the addition to the tune of Rs. 1,13,49,840/- and deleted the remaining amount of Rs. 21,56,46,960/-.

6 I.T.A. No.2327/Kol/2025 CO No. 93/Kol/2025 Assessment Year: 2016-17 Royal Securities Limited AO was totally baseless in comparison to the material on record. The Ld. CIT(A) in para 6.2.2 noted that no cash was deposited in the said bank account before making payment to the assessee and the purported amount was credited adopting proper banking channel through RTGS/payee cheques of the said amalgamating companies. The Ld. CIT(A) noted that the said transaction of sale of investments was duly supported with copies of sale bills, bank statement submitted by the assessee during the course of appellate proceedings as well as assessment proceedings. We note that the investments sold were part and parcel of regular books of account which were purchased through normal banking channels. The Ld. CIT(A) also noted that the AO has not brought any documentary evidences, incriminating material and adverse statements on records or any of the alleged fund/ cash trail bank holders who admitted that the said cash deposited belonged to the assessee. The Ld. CIT(A) after giving details of purchases, invoices in earlier years accepted identity and creditworthiness of the parties and genuineness of the transactions and deleted the addition to the tune of 95% while sustaining only 5% by Ld. CIT(A) merely on conjectures and surmises basis. In our opinion, once the purchase of shares were accepted in the hands of the amalgamation then the same cannot be doubted in the year of sale and cannot be added u/s 68 of the Act. The case of the assessee is squarely covered by the decision of Hon'ble Jurisdiction High Court in case of Principal Commissioner of Income-tax Vs. Tulsyan and Sons (P.) Ltd. [2025] 174 taxmann.com 37 (Calcutta)[16-04-2025]. We further find that the said decision of the Hon'ble Jurisdictional High Court has been followed in the case of ACIT v. Pawanputra Advertising (P.) Ltd. [IT (SS) Appeal Nos. 144 & 145 (Kol.) of 2024, dated 26-8-2025], by the coordinate bench wherein the addition as sustained by the CIT(A) was deleted. The operative part of the same is as under:-

“7. We have heard the rival contentions and perused the materials available on record including the written submissions dated 21.04.2025 and paper books No. 1 (page No. 1 to 357), paper book no. 2 (page No. 1 to 354 and paper book 3 (Case Laws). We find that the only dispute is sale of part unlisted equity shares to various parties thereby realizing total sales consideration of ₹11,56,20,000/-. We note that the assessee raised money by issue of equity shares in A.Y. 2008-09 of Rs. 64,85,49,000/- . We also note that

7 I.T.A. No.2327/Kol/2025 CO No. 93/Kol/2025 Assessment Year: 2016-17 Royal Securities Limited entire funds raised were invested in unlisted equity shares in AY 2011-12. We note that the case of the assessee was selected for scrutiny only for this reason and the money raised by the assessee was accepted by the department and no adverse interference was drawn. We note that in A.Y. 2010-11 also, the case of the assessee was selected for scrutiny and all the money share capital /share premium was accepted. Thereafter the investments were made in private equity shares which were unlisted in A.Y. 2011-12. Similarly 2017-18 the case of the assessee was selected for scrutiny and investments were not doubted at all. Thus it is clear that over all these years the investments were not doubted by the department. These investments made in the A.Y. 20111-12 were partly sold at cost by the assessee during the instant assessment year which realized ₹11,56,20,000/- which were accepted by the Revenue right from A.Y. 2011-12 till the instant assessment year. We have also noted that the assessee has filed before the ld. AO as well as before the ld. CIT (A) all the evidences qua the purchases and sale of shares. The assessee has filed all the evidences qua the purchasers such as ITRs, names, addresses, audited balance sheets, bank statements, confirmations, etc. proving the identity, creditworthiness of the purchasers and genuineness of the transactions. We note that even the purchasing companies have filed their evidences as called for by the ld. AO comprising all the evidences as stated above. The ld. CIT (A) has recorded a finding of fact that apart from the assessee , purchasing companies had also filed all the evidences before the ld. AO however the ld. AO had not brought on record any independent and substantive evidences pointing out any defect or deficiency in the said evidences. The ld. CIT (A) finally noted that the assessee has proved the identity and creditworthiness of the parties and also the genuineness of the transactions by filing all these documents and thus, discharged its initial burden. Besides, we note that nothing incriminating was found and seized during the course of search. 8. We observe that the ld. CIT (A) also noted that the department has accepted all these investments in the earlier assessment years, even in the scrutiny assessments and had not drawn any adverse interference. Therefore, we do not find any infirmity/anomaly in the appellate order of the ld. CIT (A), who has passed a very reasoned and speaking order after following the decision of Hon'ble Jurisdictional High Court in case of CIT VS. Dataware Private Ltd. (supra) as well as the decision of the co-ordinate benches on the same issue namely; M/s Swarna Kalash Commercial Pvt. Ltd. vs ACIT (supra) & M/s Ashtvinayak Sales Pvt. Ltd. vs ACIT (supra). We have perused the decisions in the above referred two decisions of the coordinate benches followed by the ld. CIT (A) and find that the issue is exactly similar as before us in the present case. The operative part of M/s Ashtvinayak Sales Pvt. Ltd. vs ACIT (supra) extracted below: - 9. We have heard the rival contentions and perused the materials as placed before us. The issue for adjudication before us is in respect of confirmation of addition by ld CIT(A) as made by the AO on the ground that the identity and credentials of the purchasers are suspicious. We observe that the assessee has been in the regular business of purchase and sales of investments over the years as corroborated by the materials placed before us. Even the sales proceeds received during the current financial year were in respect of sale of shares

8 I.T.A. No.2327/Kol/2025 CO No. 93/Kol/2025 Assessment Year: 2016-17 Royal Securities Limited /investments partly out of opening balance and partly out of current purchases as is apparent from the following chart placed before us:-

9.1. The assessee has also filed movement of investments over the years which showed that the phenomenon of purchase and sale of shares/investments was regular feature of the assessee’s business. This is also undisputed that the assessee company had raised share capital (including premium) amounting to Rs.119,84,67,000/- in financial year 2010-11, relevant to AY 2011-12 and the capital so raised in AY 2011-12 was invested in shares/securities and accounted for in the books of accounts which were audited and audited accounts are placed at page no. 102 to 111 of PB Vol.-1. We also note that the assessment for AY 2011-12 was framed u/s 143(3) of the Act vide order dated 17.03.2014 a copy of which is placed at page no. 276 and 277 of PB Vol.-1 and the neither the sharecapital/share premium nor the investments out of that source were doubted by the AO. 9.2. We also note that similar issue was involved in the case of M/S Swarna Kalash Commercial Pvt Ltd. Vs ACIT ,Central Circle -2(2), Kolkata, a group concern of the Rashmi Group of Companies ,which was also subjected to search u/s 132(1) of the Act in the same search proceedings. We note that the coordinate bench has decided the issue in favour of the assessee in ITA No. I.T.(S.S.)A.No.53/Kol/2022 A.Y.2019-20 vide order dated 01.09.2023 involving the same issue of addition of sale of shares/investments by the AO on the ground that identity and credentials of the purchasers of shares/investments were suspicious. The operative part of the order is extracted as under: “6.1.We have considered the rival contentions and gone through the record. First we deal with the issue relating to the undated detailed order passed by the Assessing Officer even after the prescribed date of limitation for passing the assessment order for the assessment year under consideration which is other than the short cryptic order as reproduced above and which did not even bear any Document Identification Number, (in short “DIN”)as mandated vide CBDT Circular No.19 of 2019. 6.1. As mentioned in the said CBDT circular no. 19 of 2019 and as also further held by the Hon’ble Delhi High Court in the case of CIT vs. Brandix Mauritius Holdings Ltd. [2023[ 149 taxmann.com 238 (Del), any communication without mentioning of the DIN in its body is to be treated as non-est. Therefore, the subsequent undated assessment order and without any DIN mentioned in the order, and passed after the limitation period prescribed for passing of the assessment order cannot be taken cognisance of. 7. So far as the original order (extracted above) passed by the Assessing Officer is concerned, we are in agreement with the contentions of the Ld. Counsel for the assessee that the same is a small and cryptic order

9 I.T.A. No.2327/Kol/2025 CO No. 93/Kol/2025 Assessment Year: 2016-17 Royal Securities Limited and the additions have been made by the Assessing Officer in the said order in a mechanical manner without any discussion on merits and without pointing out any justifying material warranting such additions. Therefore, the additions made by the Assessing Officer by way of such an cryptic order are not sustainable as per law. …….. 11. We have considered the rival contentions and gone through the record.We find force in the submissions made by the learned Counsel of the assessee which have been discussed above in detail. We note that it is an admitted fact on record that assessee raised share capital at a premium in FY 2005-06 which was accepted by the AO in scrutiny assessment under section 143(3). The capital so raised was invested in shares of Pvt. Ltd. of various companies. These shares were sold during the year under consideration to different parties, corporate/non- corporate. The sale proceeds have come in assessee’s bank account through banking channel. 11.1. In its normal course of business, the assessee had made purchases and sale of investments as under which is tabulated as under:

11.2. The shares were held by the assessee as investments and were sold at the cost of acquisition by the assessee. Hence, there is no profit/loss on such sale of investment. We also look at the movement of investment held by the assessee, which is tabulated below: FY AY Opening Purchase Sales Amount byA.O. Closing Balance 2014-15 2015-16 63,42,00,000 63,42,00000 2015-16 2016-17 63,42,00,000 42,44,960 18,344,960 62,01,00,000 1,83,44,960 2016-17 2017-18 62,01,00,000 56,27,44,459 468,499,459 71,43,45,000 46,84,99,459 2017-18 2018-19 71.43.45,000 1,55,17,29,538 2,062,064,910 20,40,09,628 2,06,20,64,910 2018-19 2019-20 20,40,09,628 66, 47, 64, 007 170,560,000 69,82,13,635 17,05,60,000 Total 2,71,94,69,239 11.3. We also refer to the details of opening stock, purchases, sales and closing stock during the year, placed on record by the assessee: SI Opening Purchases Sales Closing No Name of the Script Balance Balance Amount Amount Amount Amount I Bellona Supply Pvt. Ld. 1,24,57,344 0 1,24,57,344 0 2 P N Jewelers Pvt ltd 38,45,323 0 38,45,323 0 3 Rozela Tie Up pvt. Ltd. 3,64,33,053 0 3,64,33,053 0 4 Rashmi Cement Ltd. 0 1,57,32,000 0 1,57,32.000 5 CimmcoVinimayPvt. Ltd. 13,32,04,353 53,71,44,701 0 67,03,49,05 4

10 I.T.A. No.2327/Kol/2025 CO No. 93/Kol/2025 Assessment Year: 2016-17 Royal Securities Limited 6 Festive Vincom Pvt Ltd 28,01,625 0 0 28,01,625 7 GreenHillDealmark Pvt Ltd 26,14,850 0 0 26,14,850 8 SwabhimanCommosales Pvt 26,15,900 0 0 26,15,900 Ltd 9 Topline Business Pvt Ltd 41,00,205 0 0 41,00,205 10 VidyaBuildcon Pvt Ltd 0 2,50,00,000 2,50,00,000 0 11 BadrinathMinning Pvt Ltd 59,36,974 75,250 60,12,224 0 12 Sankul Retailers Private Ltd 0 74,49,572 74,49,572 0 13 Alok Financial Services Pvt 0 8,10,000 8,10,000 0 Ltd 14 Asankul Cosmetics Pvt Ltd 0 6,55,26,090 6,55,26,090 0 15 Daffodil Plaza Pvt Ltd 0 88,198 88,198 0 16 NAT Communication & 0 1,26,37,632 1,26,37,632 0 Marketing Pvt Ltd 17 Alok Pattanayak 0 3,00,000 3,00,000 0 Total 20,40,10,245 66,47,63,507 17,05,60,000 69,82,13,63 4 11.4. Based on the analysis of the above details, it is evident that entire sales is made from purchases & opening stock as under: Breakup of Sale of Shares Amount(Rs.) Breakup of Sale of Shares Amount(Rs.) Sold out of Opening Investment Sold out of Opening Investment 5,86,73,194 5,86,73,194 Sold out of Investment Purchased During Sold out of Investment Purchased During the Year 11,18,86,806 the Year 11,18,86,806 Total 17,05,60,000 Total 17,05,60,000 11.5. It is also important to note that the AO has made enquiries from the buyers of the shares sold by the assessee by issuing summons u/s 131 of the Act who have responded and furnished the required details. Summary Statement of the replies made in response to notice u/s 131 by various buyers (Sale of Shares) is tabulated below:

11 I.T.A. No.2327/Kol/2025 CO No. 93/Kol/2025 Assessment Year: 2016-17 Royal Securities Limited

12 I.T.A. No.2327/Kol/2025 CO No. 93/Kol/2025 Assessment Year: 2016-17 Royal Securities Limited 1028 (Jodhpur). The Hon’ble Delhi High Court in the case of “CIT vs. Harjeev Agarwal” in ITA No.8/2004 vide order dated 10.03.16 has observed that a statement made under section 132(4) of the Act on a stand-alone basis, without reference to any other material discovered during search and seizure operation, would not empower the AO to make a block assessment merely because any admission was made by the assessee during search operation. In the case of “Commissioner of Income Tax vs. Sunil Agarwal” (2015) 64 taxman.com 107 (Delhi-HC), the assessee therein, during the course of search, made a categorical admission under section 132(4) that the cash amount seized belonged to him and it represented undisclosed income not recorded in the books of accounts. The assessee did not immediately retract from the above admission but only during the assessment proceedings at a belated stage. In his retraction, the assessee stated that the surrender was made under a mistaken belief and without looking into books of account and without understanding law and that he had been compelled and perturbed by events of search and that the pressure of search was built so much that he had to make the surrender without having actual possession of the assets or unexplained investments or expenses incurred and that there was no such income as undisclosed. The Hon’ble Delhi High Court, after considering the fact and circumstances of the case, while dismissing the appeal of the revenue, observed that though the fact that the assessee may have retracted his statement belatedly, yet, it did not relieve the AO from examining the explanation offered by the assessee with reference to the books of account produced before him. Although, a statement under section 132(4) of the Act carries much greater weight than the statement made under section 133A of the Act, but a retracted statement even under section 132(4) of the Act would require some corroborative material for the AO to proceed to make additions on the basis of such statement. 12.2 In the case of “BasantBansal vs. ACIT” reported in (2015)63 taxmann.com 199 (Jaipur Trib.), the assessee therein, during the search and seizure action u/s 132 of the Act, offered a summary discloser of income as undisclosed and the department accepted the summary surrender of income and thereafter advance tax for the said surrendered of income was also deposited, but thereafter it was contended by the assessee that the surrender was made under threat or coercion and that no incriminating material was found during the search action. The stand of the department was that the admission was voluntary and was not under a mistaken belief of fact or law and that the assistance had enough time to go through the facts of their case, law applicable in their case and take advice from their counsels and advisors before filing the letter of surrender of undisclosed/unaccounted income and that the admission by them was final and binding on them; The co-ordinate Jaipur Bench of the Tribunal, after overall appreciation of the fact and evidences before it, observed that the assessee’s surrender was not based on any incriminating material and that the discloser being not voluntary and extracted by the department in creating a coercive situation cannot be relied solely to be basis of addition as undisclosed income. The co-ordinate bench of the Tribunal while relying upon various case laws of the higher authorities observed that it is well

13 I.T.A. No.2327/Kol/2025 CO No. 93/Kol/2025 Assessment Year: 2016-17 Royal Securities Limited settled legal position that merely on the basis of a statement which is not supported by the department with cogent corroborative material cannot be a valid basis for sustaining such ad-hoc addition. The co-ordinate Jaipur Bench of the Tribunal (supra) further observed that the issue of existence of pressure, threat, coercion during search proceedings is to be judged by reference to the existing facts and circumstances, human conduct and preponderance of possibilities. During the search proceedings, record relating thereto being in exclusive custody of the searching officers, it is their wish and will which prevails during the fateful period. That it is almost impossible for the assessee to adduce demonstrative evidence of exerting such pressure. The co-ordinate bench of the Tribunal (supra) while holding so, apart from relying upon various decisions of the higher courts has also relied upon the decision of the Tribunal in the case of “Dy CIT vs. Pramukh Builders” (2008) 112 ITD 179 (Ahd.) wherein it has been held that even in the absence of proof of coercion or pressure, the statement by itself cannot be taken as conclusive. Therefore, merely in the absence of proof of pressure, threat, coercion or inducement the statement cannot be held as conclusive and additions cannot be made by solely relying on a statement or a letter. 12.3. The case of the assessee, before us, is on better footing as in this case, there is no delay in retraction of the statement which was done on the very next day by filing affidavits before the Metropolitan Magistrate 12.4. Even the CBDT Letter No.286/2/2003-IT(Inv) dated Oct 3, 2003 in this respect read as under: “To The Chief Commissioners of Income Tax, (Cadre Contra) & All Directors General of Income Tax Inv. Sir, Subject: Confession of additional Income during the course of search & seizure and survey operation – regarding Instances have come to the notice of the Board where assessees have claimed that they have been forced to confess the undisclosed income during the course of the search & seizure and survey operations. Such confessions, if not based upon credible evidence, are later retracted by the concerned assessees while filing returns of income. In these circumstances, on confessions during the course of search & seizure and survey operations do not serve any useful purpose. It is, therefore, advised that there should be focus and concentration on collection of evidence of income which leads to information on what has not been disclosed or is not likely to be disclosed before the Income Tax Departments. Similarly, while recording statement during the course of search it seizures and survey operations no attempt should be made to obtain confession as to the undisclosed income. Any action on the contrary shall be viewed adversely.

14 I.T.A. No.2327/Kol/2025 CO No. 93/Kol/2025 Assessment Year: 2016-17 Royal Securities Limited Further, in respect of pending assessment proceedings also, assessing officers should rely upon the evidences/materials gathered during the course of search/survey operations or thereafter while framing the relevant assessment orders. Yours faithfully, 12.5. A perusal of the above circular also shows that it is in the notice of the statutory controlling body of the Income Tax Authorities that the revenue officials are used to take confessional statements from the person searched under force, pressure or threat and that is why they have made it mandatory that additions solely on the basis on such statements should not be made and that corroborative evidences should be collected or obtained before making such additions. The circular of the CBDT is binding on the revenue officials. In the facts and circumstances of this case, when seen in the light of above case laws and CBDT circular, additions in this case cannot be said to be justifiably made. 13. All the above details when kept in juxtaposition, there remains nothing to cast an iota of doubt on the sale transaction of shares held by the assessee as investments which it undertook in the ordinary course of its business, more importantly, purchases having made in the current year also. Further, as rightly pointed out by the learned Counsel, both opening balance of investment in shares and the purchases made during the year have not been disputed or doubted by the authorities below so as to bring the entire sale consideration to tax. 14. At this stage, the ld. DR has submitted that the assessee has claimed that it has undertaken this sale transaction by selling the shares at the cost at which it had acquired them in AY 2006-07. At the same time, assessee submits that it has undertaken this transaction in the ordinary course of its business. The ld. DR has submitted that the conduct of business is always with a profit motive, more particularly when the assessee had held these shares for past several years and had also made purchases during the year, deploying its funds. There ought to be certain element of profit embedded in the sale transaction executed which must be brought to tax. 15. Considering the above submission of the ld. DR and taking a holistic view of the facts and circumstances of the case, we find it proper to consider net profit element @ 5% of the sale consideration i.e. 5% of Rs.17,05,60,000/- which comes to Rs.85,28,000/- be subjected to tax. We, accordingly delete the addition to the extent of Rs.16,20,32,000/- made u/s 68 of the Act and sustain the balance of Rs.85,28,000/- towards profit element on the impugned sale transaction of shares undertaken by the assessee. 16. In the result, appeal of the assessee is partly allowed. 9.4. It is clear from the above that the facts in the instant case before us are materially same vis a vis the facts in the case decided by the coordinate bench supra in group concern. We, therefore, respectfully following the same set aside the order of ld CIT(A) and direct the AO to apply profit of 5% on the sales proceeds of Rs. 99,72,36,896/- which comes to Rs. 4,98,61,845/- and delete the remaining addition of Rs. 94,73,75,051/-.

15 I.T.A. No.2327/Kol/2025 CO No. 93/Kol/2025 Assessment Year: 2016-17 Royal Securities Limited 10. In the result the appeal of the assessee is partly allowed.” 9. We have also perused decision by the Hon'ble High Court in ITAT/239/2024 in IA No. GA/2/2024 vide order dated 16th April, 2025, in the case of PCIT Vs. Tulsyan and Sons Private Limited(supra) affirmed the order of the tribunal. In the said case the addition made by the ld. AO on account of sale of investment was deleted by the ld. CIT (A) and the Tribunal confirmed the order of the ld. Assessing Officer. The Hon'ble High Court while deciding the issue held as under: - We have heard Mr. Aryak Dutta, learned standing counsel assisted by Mr. Soumen Bhattacharjee, learned standing counsel for the appellant and Mr. J. P. Khaitan, learned senior advocate assisted by Mr. PratyushJhunjhunwalla, learned advocate for the respondent. The short issue which falls for consideration is whether the learned tribunal was right in affirming the order passed by the Commissioner of Income Tax (Appeals)- 21, Kolkata [CIT(A)] dated 10.5.2023 by which the assessee’s appeal was allowed and the addition made under section 68 of the Act was deleted. The Assessing Officer made the addition by invoking section 68 of the Act on the ground that the assessee failed to discharge its onus to establish identity, creditworthiness and genuineness of the transaction in respect of the money received through cash trail. The CIT(A) in course of hearing the appeal called for a remand report from the Assessing Officer and in the said remand report the Assessing Officer has in no uncertain terms accepted the receipt of the impugned sum on account of sale proceeds of investment. The Assessing Officer verified the investment sold which are shown in the balance-sheet for the financial year 2010-11 in Schedule-4 of the balance-sheet and after considering these facts it was stated that the assessee had sold shares held by way of the investment during the year to M/s. Shivshakti Communications and Investment Pvt. Ltd. and Carnation Tradelink Pvt. Ltd. and it is not a receipt of unsecured loan. This fact, apart from other factual details, were considered by the CIT(A) and by an elaborate order dated 10.5.2023 the appeal filed by the assessee was allowed. The tribunal on its part re-examined the factual position and took note of the findings rendered by the CIT(A) and concurred with the same. We also find that the tribunal has also examined the factual position and took note of the remand report as called for by the CIT(A) which confirmed the alleged sum is on account of sale of investment and not otherwise. Thus, we find no question of law much less substantial question of law arises for consideration in this appeal. Accordingly, the appeal fails and the same is dismissed. Consequently, the connected application stands closed. 10. Since, the facts of the case before us vis-à-vis, facts of the decisions cited above are substantially similar and therefore, we respectfully following the ratio laid down in the above decisions upheld the order of ld. CIT (A) on this issue by dismissing the appeal of the Revenue. 11. So far as the Cross Objection is concerned, we note that the assessee has challenged the direction of the ld. CIT (A) to the ld. AO to make an addition at the rate

16 I.T.A. No.2327/Kol/2025 CO No. 93/Kol/2025 Assessment Year: 2016-17 Royal Securities Limited of 5% of the total sales consideration towards the net profit embedded in the sales consideration. 12. After hearing the rival contentions and perusing the materials available on record, we find that the ld. CIT (A) has not given any basis for such direction to the ld. Assessing Officer. In other words, the ld. CIT (A) has just acted on the presumptions and surmises and thus, presumed that the assessee might have made some profits from sale by investments. In our opinion, the said direction by the ld. CIT (A) is without any substantive basis and therefore cannot be sustained. Accordingly, we set aside the order of ld. CIT(A) to the extent of this direction of making addition @ 5%. Accordingly, the cross objection of the assessee is allowed.” 11. Considering the facts of the assessee and respectfully following the ratio laid down by the Hon'ble Jurisdictional High Court in the case of Principal Commissioner of Income-tax Vs. Tulsyan and Sons (P.) Ltd. [2025] 174 taxmann.com 37 (Calcutta)[16-04-2025] and decision of the coordinate bench in ACIT v. Pawanputra Advertising (P.) Ltd. (supra),we modify the order of the CIT(A) to the extent of confirming the addition to the tune of 5% and direct the AO to delelte the addition. Accordingly, we allow the cross objection of the assessee.

17 I.T.A. No.2327/Kol/2025 CO No. 93/Kol/2025 Assessment Year: 2016-17 Royal Securities Limited 15. In the result, the appeal of the revenue is dismissed and the cross-objection of the assessee is allowed. Order is pronounced in the open court on 10th July, 2026

Sd/- Sd/-

(Pradip Kumar Choubey /�द�प कुमार चौबे) (Rajesh Kumar/राजेश कुमार) Judicial Member/�या�यक सद�य Accountant Member/लेखा सद�य Dated: 10th July, 2026 SM, Sr. PS

Copy of the order forwarded to: 1. Appellant- DCIT, Central Circle-4(2), Kolkata 2. Respondent – Royal Securities Limited, 2nd Floor, 46B, Rafi Ahmed Kidwai Road, Park Street, Kolkata-700016. 3. Ld. CIT(A)- 27, Kolkata 4. Ld. Pr. CIT- , Kolkata 5. DR, Kolkata Benches, Kolkata (sent through e-mail)