2022 (11) TMI 468 - ITAT JAIPUR

Addition u/s 68 - bogus LTCG - penny stock purchases - denial of cross examination of persons giving credit - HELD THAT:- As noted that the assessee requested the AO for cross examination of all such persons but the assessee was not provided opportunity of cross examination holding that at this juncture of time, it is an attempt to delay/ halt the proceedings by assuming the instrument of cross examination as a right. It is understandable that for the sake of natural justice, the assessee can exercise his power to cross examine the evidences gathered against her. Hence, the assessee was deprived off to cross examine the persons whose statements / evidences were obtained against her.

Equity market is under control and supervision of SEBI, price of scrip is not in control of the assessee or any individual person. The stock market is completely based on probabilities of market political scenario, trend of market, fiscal policy, stability of government speculation, global trend of market etc. - Theory of probability of gain or loss is always there but it may not be pre-arranged as the market is based completely on electronic system. The SEBI suspended only trading of 26 scrips out of the above said 58 scrips and only 11 scrips prices were found rigged. Sunrise Asian Ltd. (Scrip Code 506615) was not included in these scrips whose shares assessee had purchased on 01-04- 2012.

As also noted that no cogent evidence against the assessee has been found by the lower authorities and all the payments were routed through banking channel by using cheque. In this case, it is found that the enquiries were conducted by the DCIT at Kolkata and the statements were recorded at the back of the assessee. Assessee was deprived off to cross examine the witnesses. It is also noted that no any cogent material to show that the assessee has brought back his own unaccounted income in cash. In view of the above deliberations, facts and circumstances of the case, the Bench finds that the ld. CIT(A) is not justified in dismissing the appeal of the assessee by confirming the above additions hence, the Bench delete the additions made by the lower authorities by allowing the appeal of the assessee.