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Income Tax Appellate Tribunal, “A” BENCH, KOLKATA
Before: SHRI RAJESH KUMAR, AM & SHRI PRADIP KUMAR CHOUBEY, JM
O R D E R Per Rajesh Kumar, AM:
This is an appeal preferred by the assessee against the order of the National Faceless Appeal Centre, Delhi (hereinafter referred to as the “Ld. CIT(A)”] dated 19.07.2024 for the AY 2015-16.
At the time of hearing the ld. Counsel for the assessee pressed the ground no.6, which read as under:-
“6. On the facts and in the circumstances of the case, and in accordance with the order under section 148A(d) of the Act, and in the show cause notice also the allegation of escaped income pertained to the purchase of shares, which led to the issuance of a notice under section 148. However, the assessment order erroneously assessed the case based on long-term capital gains, which contradicts the principles of equity and fairness in completed assessments.”
After hearing the rival contentions and perusing the materials available on record, we find that the reasons recorded by the ld. AO to reopen the assessment and issued notice u/s 148 of the Act on 28.07.2022. We note that in the order passed u/s 148A(d) of the Act and in the show cause notice the allegation was with regard to escapement of income pertaining to purchase of shares which led to issuance of notice u/s 148 of the Act. However, in the assessment framed the ld. AO has made a very incoherent finding sometimes referring to the escapement of income and sometime stating that the assessee has not explained the purchase and sale of shares with cogent evidences with contract notes and Demat accounts, bank statement, etc. and on page no.8 para 2, the ld. AO himself noted that these shares were sold in the next assessment year and these shares of M/s Jackson Investment Ltd. numbered 41,000/- equity shares were sold through SMC Global Securities Limited and finally, added the same on account of Long Term Capital Gain. In our opinion there is total non-application of mind while passing the order u/s 148A(d) of the Act, issuing show cause notice and while framing the assessment at every stage as the AO was fully of casual and there was complete non-application of mind. Under these circumstances, we are not in a position to sustain the reopening of assessment by the ld. AO. We note that AO recorded a finding that the shares were sold in the next financial year whereas the addition was made on account of long term
In the result, the appeal of the assessee is allowed.
Order pronounced in the open court on 25.03.2025.