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2016 (8) TMI 1304 - ITAT MUMBAIBogus share transaction - veracity of statement made under section 131 - Held that:- Assessing Officer has treated the share transaction as sham / bogus by solely relying upon the statement of Shri Mukesh Choksi, director of Mahasagar Securities Pvt. Ltd. and Alliance Intermediaries Network Pvt. Ltd., wherein he allegedly admitted of having provided accommodation entries only and there was no share transaction actually made. Apart from the statement of Shri Mukesh Choksi, the Assessing Officer has not referred to any other material or evidence which could corroborate or conclusively prove the facts stated by Shri Mukesh Choksi. Moreover, it is uncontroverted fact that the statement recorded of Shri Mukesh Choksi, under section 131 and other adverse materials claimed to be in the possession of the Department, which were utilised for treating the share transactions of the assessee as sham / bogus was never confronted to the assessee nor the assessee was supplied with those materials. The assessee was not allowed the opportunity to cross examination Shri Mukesh Choksi, to test the veracity of statement made by him under section 131 of the Act. Though, the assessee raised this issue before the learned Commissioner (Appeals), but the learned Commissioner (Appeals) has neither properly considered nor appreciated the contention of the assessee. In our view, without confronting the statement of third party on the basis of which the Assessing Officer made the addition and without allowing opportunity to the assessee to cross examine the concerned person no addition can be made on the basis of such untested material.
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