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2018 (4) TMI 981 - AT - Income TaxLong Term Capital Gains being earned on the sale of scrips disallowed - sale considered as a sham transaction and the LTCG was treated as income from undisclosed sources - Held that:- It is an admitted fact that the brokers replied to the notices sent by the A.O. and confirmed the impugned transactions. Moreover, Pravin Kumar Agrawal of P.K. Agrawal & Co. (broker) in his affidavit dated 19.12.2006 has solemnly affirmed the transaction which are exhibited at pages 141 of the paper book. A.O. has not said anything adverse insofar as the affidavit of Shri P.K. Agrawal is concerned, nor the A.O. has made any specific enquiry in respect of the share transactions done by the assessee. The A.O. has simply relied on the survey report which was in context of survey u/s. 133A of the Act conducted in the case of Ahilya Commercial Pvt. Ltd. and P.K. Agrawal on 28.12.2004 by the revenue authorities of Kolkata. Assuming that the brokers may have done some manipulation but the assessee cannot be held liable for the Act of the brokers when the entire transactions have been done through banking channels duly recorded in the Demant accounts with a Government depository and traded on the stock exchange. The entire assessment is based upon the conclusion of the DDIT (Inv.) Kolkata and there is no application of mind by the A.O. Moreover, the A.O. had no access to the materials impounded by the Investigation Wing of Kolkata, the A.O. was simply carried away by the reports of the DDIT (Inv.), Kolkata without making any independent decision. There is also nothing on record which could suggest that the assessee gave cash and purchase cheque from the alleged brokers. The entire assessment is based on conjectures and surmises and therefore cannot stand on its own leg. - Decided against revenue
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