VASUNDHARA KOTIA,KOLKATA vs. ITO, WARD 40(2), KOLKATA

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ITA 73/KOL/2022Status: DisposedITAT Kolkata30 May 2022AY 2014-153 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal found that the assessment order was passed without application of mind, containing contradictory information about the shares traded. The lower authorities' orders lacked specific discussion of the assessee's actual transactions.

What were the facts?

The assessee reported long-term capital gains of Rs. 18,81,230/- from the sale of shares. The Assessing Officer and CIT(A) treated these gains as bogus and made additions to the assessee's income.

What were the issues?

Whether the addition made by the Assessing Officer and confirmed by the CIT(A) was sustainable in law, given the lack of specific evidence and application of mind by the lower authorities.

Which sections of the Income-tax Act were involved?

Section 68

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “SMC”

Before: Shri Sanjay Garg

IN THE INCOME TAX APPELLATE TRIBUNAL “SMC” BENCH KOLKATA Before Shri Sanjay Garg, Judicial Member Assessment Year: 2014-15 Vasundhara Kotia.....................................………….………………….……Appellant 17, Mayfair Road, Kolkata-700019. [PAN:BBQPK2411M] vs. ITO, Ward-40(2), Kolkata……….…..…...............……........……...…..…..Respondent Appearances by: Shri K. M. Roy, Advocate, appeared on behalf of the appellant. Smt. Ranu Biswas, Addl. CIT-DR, appeared on behalf of the Respondent. Date of concluding the hearing : May 30, 2022 Date of pronouncing the order : May 30, 2022

ORDER

Per Sanjay Garg, Judicial Member:

1.

The present appeal has been preferred by the assessee against the order dated 29.12.2021 of the National Faceless Appeal Centre [hereinafter referred to as ‘CIT(A)’] passed u/s 250 of the Income Tax Act (hereinafter referred to as the ‘Act’). The assessee in this appeal has taken the following grounds of appeal:

“1. That the CIT Appeal has erred in invoking the provisions of section 68 of the Act and making the additions of Rs.1881230 being amount received for sale of listed shares as bogus transactions and not appreciating the facts that aforesaid transaction is genuine and permissible under law.

2.

That the CIT Appeal wrongly alleged that the appellant has entered into accommodation entry for aforesaid transaction and failed to prove the same with concrete evidence.

3.

That the appellant craves leave to add, alter, amend or withdraw any ground or grounds of appeal

before or at the time of hearing of this appeal.”

2. The brief facts of the case are that the Assessing Officer noted that the assessee had sold 50,000 shares of Panchshul Marketing Ltd. and earned long-term capital gains of Rs.18,81,230/-. The Assessing Officer noted that the aforesaid capital gains shown by the assessee was bogus. Therefore, he made the impugned addition.

Assessment Year: 2014-15 Vasundhara Kotia 3. The ld. CIT(A) has also confirmed the addition so made by the Assessing Officer. Being aggrieved the assessee has come in appeal before this Tribunal.

4.

At the outset, the ld. Counsel for the assessee invited my attention to the impugned assessment order to submit that in fact the assessee had purchased shares of Careful Projects Advisory Ltd. which later on merged with M/s Kailash Auto Finance Ltd. However, a perusal of the assessment order shows that the Assessing Officer has not mentioned any sale and purchase of shares made by the assessee of the aforesaid scrip of Careful Projects Advisory Ltd. or M/s Kailash Auto Pvt. Ltd. The Assessing Officer firstly mentioned that the assessee had dealt with sale and purchase of shares of M/s Panchshul Marketing Ltd. However, in the next para, it has been mentioned that the assessee has dealt in the purchase and sales transaction of M/s NCL Research Ltd. A perusal of the assessment order shows that the same has been passed without application of mind which seems to be cut and paste from the case of the some other assessee.

I further find that there is no specific discussion relating to sale and purchase of shares made by the assessee from Careful Projects Advisory Ltd. and M/s Kailash Auto Finance Ltd. The ld. CIT(A) has also upheld the addition made by the Assessing Officer in a mechanical manner. There is no specific discussion either by the Assessing Officer or in the order of the ld. CIT(A) regarding the actual transactions done by the assessee. Orders of both the lower authorities are not specific of any transaction made by the assessee. In view of this, the addition made by the lower authorities vide the impugned orders is not sustainable in the eyes of law and the same is ordered to be deleted.

6.

In the result, the appeal of the assessee stands allowed.

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