C.I.T. UDAIPUR vs. KAN SINGH RATHORE

1 IN THE HIGH COURT OF JUDICATURE FOR RAJASTHAN AT JODHPUR JUDGMENT D.B. INCOME TAX APPEAL NO.192/2014 DATE OF ORDER :: 03.12.2014 PRESENT HON'BLE MR. JUSTICE GOVIND MATHUR HON'BLE MR. JUSTICE PRAKASH GUPTA Mr. KK Bissa, for the appellant ... BY THE COURT : This appeal is preferred to question correctness of the order dated 3.4.2014 passed by learned Income Tax Appellate Tribunal, Jodhpur Bench, Jodhpur affirming order dated 25.2.2013 passed by the Commissioner of Income Tax (Appeals), Udaipur. The facts necessary to be noticed for adjudication of this appeal are that an assessment order as per provisions of Sub- Section (3) of Section 143 of the Income Tax Act, 1961 was passed by the Deputy Commissioner of Income Tax, Chittorgarh on 30.12.2010. The Assessing Authority treated the transaction of the assessee with Unitech as bogus. Suffice to mention that the shares of Unitech were purchased by the assessee through Mahasagar Securities Private Limited, Mumbai. The finding of bogus transaction by the assessee was given by relying upon the statement made by 2 Shri Mukesh Choksi, Director of Mahasagar Securities Private Limited during the course of a search at the business premises of Mahasagar Securities Private Limited. The Commissioner of Income Tax while setting aside the finding given by the Assessing Authority held that whatever transaction took place, was genuine and in accordance with the norms of SEBI. It was also held that the statement given by Mr. Mukesh Choksi could have not been read against the assessee being unconfronted. The appeal preferred by the Revenue giving challenge to the order passed by Commissioner of Income Tax (Appeals), Udaipur also came to be dismissed by the judgment impugned. The learned Income Tax Appellate Tribunal after examining the arguments advanced and also the record arrived at the conclusion that the purchase of share was recorded in demat accounts maintained with M/s.Angel Broking Limited and the transaction was genuine one, therefore, it could not have been discarded as bogus. The Tribunal further held that the perception with regard to bogus transaction is erroneous being based on the unconfronted statement of Mr. Mukesh Choksi. We do not find any wrong with the judgment impugned. It is not in dispute that the Assessing Officer treated the transaction bogus solely by relying upon the statement of Mr. Mukesh Choksi, who remained unconfronted, though, was called for 3 as per Section 133(6) of the Income Tax Act, 1961. In response, it was communicated to the Assessing Officer that no adequate assistance could be given as the entire record of Mahasagar Securities was earlier impounded and was in custody of Income Tax Department. In these circumstances, Shri Mukesh Choksi was not confronted by the assessee. In absence of it, the statement of Shri Mukesh Choksi could have not been used against the assessee. The other question with regard to business loss of Rs.4,24,557/- is also a purely question of fact and that does not constitute any substantial question of law.

The appeal is dismissed accordingly. [PRAKASH GUPTA], J. [GOVIND MATHUR], J. Sanjay