SHRI BRIJESH KUMAR ANAND,NEW DELHI vs. ASSISTANT COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE, PANAJI

IN THE INCOME TAX APPELLATE TRIBUNAL, PANAJI BENCH, GOA BEFORE HON’BLE SHRI PAVAN KUMAR GADALE, JUDICIAL MEMBER AND SHRI G. D. PADMAHSHALI, ACCOUNTANT MEMBER ITA No: 008 /PAN/2022 Assessment Year : 2011-12 Brijesh Kumar Anand T-5, Second Floor, Green Park Main, Delhi-110016 PAN : AGLPA4141K . . . . . . . Appellant V/s Asstt. Commissioner of Income Tax, Central Circle-Panaji, Goa . . . . . . . Respondent And ITA No: 009 /PAN/2022 Assessment Year : 2011-12 Manoj Anand T-5, Second Floor, Green Park Main, Delhi-110016 PAN : AGLPA4142K . . . . . . . Appellant V/s Asstt. Commissioner of Income Tax, Central Circle-Panaji, Goa . . . . . . . Respondent Appearances Assessee by: Mr Shrinivas Nayak & Mr Narcinva Lotlikar [‘Ld. AR’] Revenue by: Mr Naveen Kumar [‘Ld. DR’] Date of conclusive Hearing: 03/02/2026 Date of Pronouncement : 27/02/2026

ORDER PER G. D. PADMAHSHALI; Against the DIN & Order No. ITBA/APL/M/250/2021- 22/1039025376(1) and 1039024958(1) both dt. ITAT-Panaji Page 1 of 24

Brijesh Kumar Anand & Manoj Anand Vs ACIT, Goa ITA No.: 008 & 009/PAN/2022 AY: 2011-12 24/01/2022 passed u/s 250 of the Income-tax Act, 1961 [‘the Act’] by the Commissioner of Income Tax Appeals-2, Panaji Goa [‘Ld. CIT(A)’] the captioned two different assessee filed present appeals u/s 253(1) of the Act which in turn emanated from respective assessment order dt. 27/12/2018 passed u/s 143(3) r.w.s. 147 of the Act by Asstt. Commissioner of Income Tax Central Circle, Panaji Goa [‘Ld. AO’].

Brijesh Kumar Anand & Manoj Anand Vs ACIT, Goa ITA No.: 008 & 009/PAN/2022 AY: 2011-12 placed thereby we advanced accordingly on merits of the impugned additions only.

The facts of the lead case briefly stated are as; 4. the assessee is an individual who filed his return of ITAT-Panaji Page 3 of 24

Brijesh Kumar Anand & Manoj Anand Vs ACIT, Goa ITA No.: 008 & 009/PAN/2022 AY: 2011-12 income declaring income of ₹65,390/- on 21/01/2012. A search & seizure action u/s 132 of the Act on both the appellant assessees were carried out on 24/10/2017. In the course of investigation, it was found that the assessee along with his family member purchased equity shares of M/s Advantage Software Pvt. Ltd. [‘ASPL’] at a face value of ₹10/- per share[‘FV’]. The net asset value [‘NAV’] of ASPL was found to be ₹634/-. Therefore, the total difference of such NAV-FV on 25,000 equity shares bought by assessee since exceeded the ceiling of ₹50000/-, the Ld. AO brought the difference of ₹1,56,25000/- to tax u/s 56(2)(vii) of the Act. In consequence total income of the assessee vide order dt. 27/12/2018 framed u/s 143(3) r.w.s. 147 of the Act assessed at ₹156,90390/-. Aggrieved by the aforestated solitary addition and the assessment as such, the assessee preferred an appeal u/s 246A r.w.s. 249 of the Act, however remained unsuccessful. ITAT-Panaji Page 4 of 24

Brijesh Kumar Anand & Manoj Anand Vs ACIT, Goa ITA No.: 008 & 009/PAN/2022 AY: 2011-12 ITA No. 009/PAN/2022 5. All the facts except number of shares bought by the assessee are verbatimly identical, similar, and arising out of even search. The number of shares bought by this assessee was 50,000/-, therefore the addition in this case was ₹3,12,50,000/- was made & sustained.

Being aggrieved by the actions of the tax 6. authorities below, these assessees have filed second appeals on 29/06/2022 which were separately disposed by Ld. Co-ordinate bench ex-parte on merits vide order dt. 22/08/2023 & 21/09/2013. Considering the Miscellaneous application filed by these appellants seeking one more opportunity to represent respective cases on merits, the orders of the Tribunal were recalled vide separate order dt. 23/07/2025 & 05/05/2025 for providing one more opportunity to prove the only challenge about the year of impugned transaction of purchases of equity shares of ASPL. ITAT-Panaji Page 5 of 24

Brijesh Kumar Anand & Manoj Anand Vs ACIT, Goa ITA No.: 008 & 009/PAN/2022 AY: 2011-12 7. At the outset of hearing, the Ld. AR Nayak stated that, there is only one addition in both these appeals which is common therefore contentions raised and arguments made are to be considered accordingly. Insofar as the merits of solitary addition made u/s 56(2)(vii) of the Act is concerned, the Ld. Nayak reiterated the contention & arguments as were raised before the tax authority that, the transaction of equity share acquisition from ASPL was taken place in AY 2010-11 though registration thereof in the membership registered of ASPL may have recorded in the AY 2011- 12. Therefore, the said transaction since fell beyond the period of scope of section 147/148 of the Act addition made & sustained is arbitrary thus bad in law and as such both the learned authorities erred in not appreciating the transaction in true letter and spirit. To buttress the argument the Ld. AR Lotlikar pressed into service the decisions rendered the in case of

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Brijesh Kumar Anand & Manoj Anand Vs ACIT, Goa ITA No.: 008 & 009/PAN/2022 AY: 2011-12 ‘Annapurna Buildcon Infra Pvt. Ltd. DCIT’ [TS-195-ITAT- 2025(Mum)], ‘Smart Chip Pvt. Ltd.’ [2025:DHC:2834- DB] and the judgement of Hon’ble Apex Court rendered in ‘PCIT Vs Abhisar Buildwell P Ltd.’ [2023, 454 ITR 212 (SC)].

Brijesh Kumar Anand & Manoj Anand Vs ACIT, Goa ITA No.: 008 & 009/PAN/2022 AY: 2011-12 shareholders drawn up by ASPL as at 31/03/2010 relevant to assessment year 2010-11 showed that it does not reflect the name of these assessees. It is only upon the query from the bench the assessee claimed these lists to be a ‘list of members’ rather than ‘list of shareholders. Stressing these two lists, the Ld. DR concluded that, the evidence placed by the assessees is self-goal which confirms the facts unwaveringly. The evidence so placed by appellant operates clearly against their contentions & arguments. The former list read in conjunction with the basis upon which additions were made in the respective assessee’s hand and sustained by the Ld. CIT(A) firmly solidifies that, the equity shares were purchased in the year relevant to assessment year under consideration. The addition thus fully supported by cogent evidence on merits, therefore on the same line additions needs to be confirmed and these twin appeals needs to be dismissed.

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Brijesh Kumar Anand & Manoj Anand Vs ACIT, Goa ITA No.: 008 & 009/PAN/2022 AY: 2011-12 9. We have heard the rival party’s common submission and subject to rule 18 of Income Tax Appellate Tribunal Rules, 1963 [‘ITAT-Rules’] perused the material placed on records and considered the facts in the light of settled position of law which was forewarned to the parties for their rebuttal.

Brijesh Kumar Anand & Manoj Anand Vs ACIT, Goa ITA No.: 008 & 009/PAN/2022 AY: 2011-12 assessee to show cause why an addition there account u/s 56(2)(vii) of the Act not to be made. In response thereto, the assessee solitarily claimed that those shares were acquired on 29/03/2010 i.e., relevant to assessment year 2010-11 and not in the year under consideration as the Revenue alleged. The said reply was taken on record and vouched against the information on record and finding necessary further investigation was carried out by calling information, from the Registrar of Companies i.e., Ministry of Corporate Affairs[‘ROC/MCA’]. The verification of information received from MCA dislodged the assessee’s claim and thus solidified the findings of the Ld. AO who after confronting the same to the assessee brought the difference in NAV over FV as the escaped income u/s 56(2)(vii) of the Act and made additions of ₹1,56,25,000/- & ₹3,12,50,000/- in the hands of respective assessee against their purchases.

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Brijesh Kumar Anand & Manoj Anand Vs ACIT, Goa ITA No.: 008 & 009/PAN/2022 AY: 2011-12 11. Being aggrieved by the aforestated additions and as such by assessment the assessee preferred an appeal to Ld. CIT(A) u/s 246A r.w.s. 249 of the Act. The Ld. CIT(A) vide separate orders dt. 24/01/2022 after a threadbare discussion of subject matter of addition & by placing reliance on the landmark decision of Hon’ble Apex Court rendered in ‘CIT Vs Durga Prasad More’ [82 ITR 540] and ‘Sumati Dayal Vs CIT’ [214 ITR 801] dismissed the appeals concluding vide para 7.10 as; ‘7.10 The present case of the assessee is a perfect example of a façade created money by way of a shell companies and putting them to give a legitimate colour of converting of available with the individuals. It is again important to bring observations made by Hon'ble Supreme Court in various cases, where the Hon'ble Court has observed that the true nature of transactions in the context of human probability needs to examine to bring the truth from the apparent as observed by the Hon'ble Supreme Court in the case of CIT Vs Durga Prasad More 82 ITR 540 and in the case of Sumati Dayal vs CIT 214 ITR 801 has expounded that revenue ITAT-Panaji Page 11 of 24

Brijesh Kumar Anand & Manoj Anand Vs ACIT, Goa ITA No.: 008 & 009/PAN/2022 AY: 2011-12 authorities are also supposed to consider the surrounding circumstances and apply the test of human probability. In these cases, the transactions though apparent were held to be not real ones. Also, in 63 1TR 609 in the case of CIT vs Shri Meenakshi Mills Ltd, Hon'ble Apex Court has held that in exceptional circumstances courts are entitled to lift the veil of corporate entity and to pay regard to the economic realities behind the legal facade. (Emphasis supplied.)

Brijesh Kumar Anand & Manoj Anand Vs ACIT, Goa ITA No.: 008 & 009/PAN/2022 AY: 2011-12 (A) In case of ITA No 008/PAN/2022 (i) by the first share transfer form placed on Pg 10, the appellant assessee claimed to have purchased 8,050 shares at a FV of ₹10/-per share from ‘Beriwal Investment Chit fund Pvt. Ltd.’ The registered Folio No of transferor was quoted therein as ‘26’ whereas the shareholder list prepared by ASPL showing position of shareholding as on 31/03/2010 ends with total registered folio number 25 and there are no further entries or folios for 31/03/2010. The transferor’s registered folio number instead was 16. (ii) coming to pg-11, the appellant claimed to have purchased 7,603 shares at a FV of ₹10/-per share from ‘R S Goel and Sons HUF’ and the registered Folio No of the transferor quoted therein as ‘33’ as stated herein before there are no further entries or folios after 25 for 31/03/2010, the registered folio no of the transferor’s however was 23. (iii) coming to pg-12 by which the appellant also

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Brijesh Kumar Anand & Manoj Anand Vs ACIT, Goa ITA No.: 008 & 009/PAN/2022 AY: 2011-12 claimed to have purchased 8,562 shares at a FV of ₹10/-per share from transferor ‘Nishi Marketing Co’ and the registered Folio No quoted therein as ‘32’ whereas the shareholder list prepared by ASPL showing position of shareholding as on 31/03/2010 the transferor’s registered folio number was 24. (iv) coming to pg-13 by which the appellant also claimed to have purchased 785 shares at a FV of ₹10/-per share from transferor ‘Mutual Benefit Trust’ and the registered Folio No of transferor quoted therein as ‘29’ whereas the shareholder list prepared by ASPL showing position of shareholding as on 31/03/2010 the transferor’s registered folio number was 19. (B) In case of ITA No 009/PAN/2022 (i) by the first share transfer form placed on Pg 10, the appellant claimed to have purchased 3,400 shares at a FV of ₹10/-per share from transferor ‘Mutual Benefit Trust’ & the registered Folio No of transferor quoted

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Brijesh Kumar Anand & Manoj Anand Vs ACIT, Goa ITA No.: 008 & 009/PAN/2022 AY: 2011-12 therein as ‘29’ whereas the shareholder list prepared by ASPL showing position of shareholding as on 31/03/2010 ends with total registered folio number 25 and there are no further entries or folios for 31/03/2010. The transferor’s registered folio number instead was 19. (ii) further coming to pg-11, the appellant claimed to have purchased 13,500 shares at a FV of ₹10/-per share from Payal Gupta with transferor registered folio quoted therein as ‘22’ whereas the registered folio no of the transferor’s as per the ASPL list was 12. (iii) coming to pg-12 by which the appellant also claimed to have purchased 11,100 shares at a FV of ₹10/-per share from transferor ‘Sino Credit & Leasing Limited’ whose registered Folio No quoted therein as ‘27’ whereas the shareholder list ended with folio number 25. (iv) coming to pg-13 by which the appellant also claimed to have purchased 9,500 shares at a FV of ₹10/-per share from transferor

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Brijesh Kumar Anand & Manoj Anand Vs ACIT, Goa ITA No.: 008 & 009/PAN/2022 AY: 2011-12 ‘SK Gupta’ with registered Folio No quoted therein as ‘24’ whereas the shareholder list prepared by ASPL showing position of shareholding as on 31/03/2010 the transferor’s registered folio number was 14. And (iv) coming to pg-14 by which the appellant also claimed to have purchased 12,500 shares at a FV of ₹10/-per share from transferor ‘Lekhraj & Sons’ with registered Folio No quoted therein as ‘31’ whereas the shareholder list prepared by ASPL showing position of shareholding as on 31/03/2010 as stated hereinbefore ended with total folio number 25 and registered folio thereafter insofar as the list is concerned. The transferor’s registered folio number however as per such list it was 14 instead. These cannot be said to be typo-errors.

Brijesh Kumar Anand & Manoj Anand Vs ACIT, Goa ITA No.: 008 & 009/PAN/2022 AY: 2011-12 nos./qty of share certificates issued to the transferor was only one share certificate, but the corresponding nos./qty of share certificate stated to have been issued respectively were 24, 31, 32, 27E and 27B, 20, 25, 22, 29 etc. Further, from these share transfer forms the respective appellants have claimed that these forms were photocopied before submitting to the ASPL for recording the transfer in the membership registered at a later stage. If it was so, then as to how the folio number 42 & 41 respectively were found endorsed by the transferee himself.

Brijesh Kumar Anand & Manoj Anand Vs ACIT, Goa ITA No.: 008 & 009/PAN/2022 AY: 2011-12 AY 2010-11 were actually issued by the ROC on 28/01/2010. Meaning thereby these documents were doctored to fit case/cases to claim being made in AY 2010-11 as the validity of such forms in law found to have expired on 28/03/2010. Although these findings conclusively disproved all claims made on the basis of such Forms adduced that the transaction of purchase was carried out in preceding AY 2010-11, in the larger interest of justice we provided opportunity to these appellants to dismantle former findings by adducing annual returns, annual reports and secretarial compliance of the ASPL filed with ROC/MCA for 31/03/2010 & 31/03/2011. The appellant however chosen otherwise, in the circumstance there was hardly anything restraining from drawing negative or adverse inference against claim of purchase in AY 2011-12 as the key information/documents in possession were withheld or failed to produce.

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Brijesh Kumar Anand & Manoj Anand Vs ACIT, Goa ITA No.: 008 & 009/PAN/2022 AY: 2011-12 15. This is rooted in the doctrine/principle of ‘best evidence’ which allows courts or tribunals to presume that the missing evidence would have been unfavourable to the party who failed to produce it. A strength to apply this doctrine to the present findings can be drawn from decision of Hon’ble Supreme Court laid in ‘Motor General Finance Ltd. Vs CIT’ [2004, 138 Taxman 235 (SC)] wherein the assessee failed to adduce necessary documents or evidence in-spite of providing due opportunity by the assessing officer.

Brijesh Kumar Anand & Manoj Anand Vs ACIT, Goa ITA No.: 008 & 009/PAN/2022 AY: 2011-12 17. In view of aforestated finding a core reference may be made to landmark decision rendered in ‘McDowell & Company Ltd. v. CTO’ [1985, 154 ITR 148 (SC)] wherein their hon'ble lordships have held that ‘Tax planning may be legitimate provided it is within the framework of law, Colourable devices cannot be part of tax planning….’. Similarly, in ‘DCIT Vs Pawan Kumar Malhotra’ the Ld. Co-ordinate bench [2010, 2 ITR 250], observed that AO had concluded after meticulous enquiry as regards to purchases found as sham transaction treating the difference as undisclosed income. The Tribunal placing reliance on ‘Mc Dowell & Company Ltd.’ (supra) and ‘Sumati Dayal Vs CIT’ (supra) wherein the former case dealt with tax planning and condemned sham transactions and in later case, the inference was based upon test of human probabilities with the assessee’s version on facts were unbelieved and thus discarded as non-bonafide.

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Brijesh Kumar Anand & Manoj Anand Vs ACIT, Goa ITA No.: 008 & 009/PAN/2022 AY: 2011-12 18. In all these decisions, the judicial conclusion was clearly set out that where tax planning is permitted at the same time, the assessee is not allowed to resort to any sham transaction or colourable devices for avoiding and evading legitimate taxes otherwise payable. One of the classic judicial examples is the decision rendered by Ld. CESAT-Delhi in the case of ‘M/s Friends Trading Company Vs CoC’ [2006, Taxmann.com 649] which vide Civil Appeal No. 5608/2011 finally upheld by the Hon’ble Apex Court wherein in the context of availment of alleged forged in capital DEPB under the Customs Act held that exemption benefit availed on such forged DEPB are void ab initio on the principle that fraud vitiates everything. The ratio of this decision squarely applies to the conduct of the both the appellants before us as they had misreported the income while filing their respective returns and mis-represented before the Revenue authorities sheerly to avoid the tax.

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Brijesh Kumar Anand & Manoj Anand Vs ACIT, Goa ITA No.: 008 & 009/PAN/2022 AY: 2011-12 19. Likewise, our observation about the evidential documents, as evident in the impugned order at para 7.1 onwards, the Ld. CIT(A) after dilating the facts has rightly & clearly brought out the modus operandi adopted. From the facts on record, it is precise that the equity share purchase transactions entered were nothing but for conversion of unaccounted money and putting them a shape of legitimate colour of converting such unaccounted cash available balances. That, even in the assessment order, it has been elaborately discussed by the Ld. AO that the assessee had designed a structure of tax evasion by employing paper transfers. That, it is also apparent from the foregoing paras as held by binding decisions in the case of ‘Mc-Dowell & Co. Ltd. (supra) wherein the Hon'ble Apex Court had held that tax planning is legitimate provided it is within the framework of law and colourable devices cannot be part of tax planning.

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Brijesh Kumar Anand & Manoj Anand Vs ACIT, Goa ITA No.: 008 & 009/PAN/2022 AY: 2011-12 20. The legal principle clearly sets out that where tax planning is permitted, the assessee is not allowed to resort to sham transactions or colourable devices for avoiding and evading tax. In the realm of financial legislations or for that matter, whenever the assessee or the petitioner has approached the Court, it is necessary that they are coming before the Court of law with clean hands. The moment any fraud is detected in the conduct of the assessee or the petitioner that will vitiate all judicial acts, ecclesiastical or temporal which was referred in the decision of Hon'ble Supreme Court in the case of ‘SP Chengalvaraya Naidu vs Jagannath’ [AIR 1994 (SC) 853] where the words of Chief Justice Edward Coke of England were quoted by stating that ‘it is the settled proposition of law that a judgment or decree obtained by playing fraud on the court is a nullity and non-est in the eyes of law. A person, whose case is based on falsehood, has no right to approach the court.’

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Brijesh Kumar Anand & Manoj Anand Vs ACIT, Goa ITA No.: 008 & 009/PAN/2022 AY: 2011-12 21. In the present twin matters before us, the Revenue

authorities have given categorical finding that the

assessee had resorted to colourable devices and sham

transaction in order to defraud the Department by

camouflaging its unaccounted money/income, so that

ultimately legitimate income tax payable can be evaded.

In view of examination of facts on records and legal

principles enshrined hereinbefore, we see no cogent

reasons in not upholding the separate impugned orders

which in turn upheld the respective orders of

assessment. Thus, grounds for which these matters

were recalled are stands dismissed in very terms.

-S/d- -S/d- PAVAN KUMAR GADALE G. D. PADMAHSHALI JUDICIAL MEMBER ACCOUNTANT MEMBER Panaji/Dt: 27th February, 2026. Copy of the Order forwarded to : 1. The Appellant. 2. The Respondent. 3. The CIT(A)/NFAC Concerned 4. PCIT Concerned 5. DR, ITAT, Panaji Bench, Goa 6. Guard File By Order, Sr. Private Secretary / AR ITAT, Panaji. ITAT-Panaji Page 24 of 24