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2019 (1) TMI 347 - AT - Income TaxAddition on account of cash received out of regular books of accounts - additions based on documents found in survey u/s 133A - Held that:- Loose sheets are only dumb documents without any corroborative evidence. Assessee has submitted that all its purchases from Choudhury Hydrocarbon (P) Ltd. were duly recorded in its books of accounts and no unaccounted money is received. The loose sheets which were taken the base for addition by the Assessing Officer have not been corroborated by any further evidence. We note that neither Assessing Officer nor the ld. CIT(A) has brought any cogent evidence on record to show that the receipt to the tune of ₹ 13,40,331/- is out of unaccounted money. We note that neither the AO nor the CIT(A) has tried to cross-verify the alleged transaction by doing independent enquiry, hence, in the absence of said enquiry addition should not be made solely on the basis of loose sheets. Case of DY. COMMISSIONER OF INCOME-TAX, CENTRAL CIRCLE – 7, HYDERABAD VERSUS M. AJA BABU, HYDERABAD. [2014 (4) TMI 1087 - ITAT HYDERABAD] to followed. - Decided in favour of assessee. Disallowance in respect of Long Term Capital Loss suffered by Assessee Company on sale of equity shares of its group companies - group of the Assessee is gaining by collusive transactions leading to fictitious loss as the shares of group companies had been sold at a price much lower than its market value without the dynamics of market force - Held that:- AO was not justified in rejecting the claim of the assessee on the basis of theory of surrounding circumstances, human conduct, and preponderance of probability without bringing on record any legal evidence against the assessee in respect of the market value of the shares vis-à-vis price bargained by the parties. That is, ld AO failed to bring any cogent evidence on record to show that ‘price bargained by the parties’ to compute capital gain is not correct. CIT- A was wrong in confirming the aforesaid disallowance wrongly relying on the concept of fair market value of the transactions referred to in section 45(2) and Section 45(4) which has no relevance to the facts of this case relating to transfer of shares on actual sale value/price bargained. Considering all we are unable to uphold the stand of the Revenue. Hence, we are inclined to accept the arguments tendered by counsel of the assessee in this respect. No hesitation to hold that the impugned addition sustained by the CIT(A), is not justified and accordingly addition made on this count is directed to be deleted. - decided in favour of assessee.
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