THE ITO 4(1), INDORE vs. SHRI RAJENDRA KUMAR GUPTA, INDORE

The assessee’s case was selected on the basis of information received from DDIT(Inv.), Unit-6(2), Mumbai and accordingly upon approval proceedings under Section 148 of the Act was initiated upon issuing of notice under Section 148 of the Act dated 31.03.2018. The information so received from DDIT(Inv.), Unit-6(2), Mumbai, is this that the assessee was a beneficiary having trading of Rs.3,60,228/- in the share/scrip of VAS Infrastructure Ltd. which is a penny stock listed company and has made a bogus long term capital gain exemption under Section 10(38) of the Act. In the absence of any information and/or rebutted by the assessee, the impugned amount was added to the total income of the assessee, which was, in turn, confirmed by the First Appellate Authority.

During the appellate proceedings, the assessee submitted that he transacted inter day trading of shares in VAS Infrastructure Ltd., Mumbai by way of intra-day purchasing share Rs.3,51,018/- through secondary market and earned the profit of Rs.9170/- i.e. below the taxable unit and hence, did not file return. Further that the share transaction was carried out through banking channels and therefore, brokers and profit earned is too negligible. The details thereof was duly disclosed before the First Appellate Authority. Having regard to the facts qua documents placed by the appellant before the First Appellate Authority and particularly the contention of the appellant that the bank account, in which, the cash was deposited was not opened or operated by him and the further fact the bank has filed FIR in Police Station against certain fraudsters who opened accounts in other name and deposited cash in the same, the Ld. CIT(A) directed the Ld. AO to carry out further investigation with respect to the opening of bank account and its operation and if the bank indeed confirms the account does not belong to the appellant, proper relief to be provided to [ITO vs. Shri Rajendra Kumar Gupta]Asst.Year.–2011-12- 3 - the assessee in accordance with law. According to us, in view of the particular facts and circumstances of the case, the order passed by the Ld. CIT(A) is most appropriate, without any ambiguity so as to warrant interference. Hence, the appeal preferred by the Revenue is, therefore, found to be devoid of any merit and, thus, dismissed.

In the result, Revenue’s appeal is dismissed.