SURENDRA GARG HUF,MUMBAI vs. ITO - 19(3)(4), MUMBAI

1. 1. These are two appeals preferred by the Assessee pertaining to Assessment Years 2012-2013 and 2013-2014. Since the appeals involved identical issues arising from common factual matrix the same were heard together and are, therefore, being disposed off by way of a common order. The facts common to both the appeals are that Assessee is a Hindu Undivided Family. The return of income filed by the Assessee for the relevant assessment years was processed under Section 143(1) of the Act. Subsequently, on the basis of information received from Deputy Commissioner of Income Tax (Investigation Wing), Ahmadabad to the effect that M/s. KGN Group of Companies were engaged in providing bogus Long Term Capital Gain entries in respect of two scripts (i.e., KGN Industries Ltd. and KGN Enterprises Ltd.). Followed by the inquiry/verification by the Assessing Officer, reassessment proceedings under Section 147 of the Act were initiated in case of the Assessee for the Assessment Years 2012-2013 and 2013-2014. The Assessing Officer noted that the Assessee had claimed Long Term Capital Gain exemption under Section 10(38) of the Act in respect of sale of shares of KGN Enterprises Ltd. (in short ‘KGN Enterprises'), during the relevant previous years. The aforesaid reassessment proceedings culminated into passing of the Assessment Order(s) under Section 143(3) read with Section 147 of the Act whereby the transaction of purchase/sale of share of KGN Enterprises were held to be pre- determined transactions and additions were made in respect of the same in the hands of the Assessee under Section 68 of the Act. Being aggrieved, the Assessee challenged the validity of reassessment proceedings as well as the additions made in the hands of the Assessee on merits in appeal before the Learned CIT(A). Assessee's challenge to validity of reassessment proceedings was rejected by the CIT(A) and the grounds raised by the Assessee challenging the additions made by the Assessing Officer under Section 68 of the Act on merits in respect of Capital Gain and/or sale consideration were also dismissed. Being aggrieved, the Assessee has carried the issues in appeal before this Tribunal in two separate appeals filed for the Assessment Years 2012-2013 and 2013-2014. ITA No.300/Mum/2024 [Assessment Year 2012-2013]

We would first take up appeal preferred by the Assessee for the

Assessment Year 2012-2013 directed against the Order, dated 16/01/2024, passed by the National Faceless Appeal Centre (NFAC), Delhi (hereinafter referred to as the `CIT(A)'], whereby the Ld. CIT(A) had partly allowed the appeal of the Assessee against the Assessment Order, dated 29/12/2017, passed under Section 143(3) read with Section 147 of the Income Tax Act, 1961 (hereinafter referred to as `the Act') for the Assessment Year 2012-2013. The Assessee has raised following grounds of appeal in ITA No.300/Mum/2024 [Assessment Year 2012-2013]: