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2022 (5) TMI 215 - ITAT MUMBAIAddition on account of client code modifications - HELD THAT:- NSE permits client code modification to rectify the errors /mistakes while punching the transactions. Genuine client code modifications are permissible. As per the guidelines issued by NSE, client code modifications within the relatives, as defined under the provisions of Companies Act, 1956 is allowed. The assessee has categorically stated that client code modifications in the instant case are among the family members. This fact has not been disputed by the Revenue. No material has been brought on record to show that any penal action has been taken by Stock Exchange or SEBI against the broker of the assessee for carrying out fictitious client code modifications for suppression of profits. The observations made by AO assessment order that brokers are indulging in transferring fictitious losses to different clients to reduce the tax liability, are generic. There is no specific allegation of such fictitious client code modification supported by cogent evidence to suggest that the broker of the assessee at the instance of assessee or the assessee has indulged in such nefarious activities. Assessee has pointed that during the First Appellate proceedings the assessee requested to provide copy of remand report. Despite repeated requests, the copy of remand report was not furnished to the assessee. It is a well settled principle of natural justice that before taking cognizance of any material the same should be furnished to the opposite side to rebut the same. In the instant case the CIT(A) has failed to provide opportunity to the assessee to furnish his comments on the observation made by AO in the remand report. Any material on which reliance has been placed to make the addition/confirming the addition without confronting it to the assessee would make the order void. - Appeal of assessee allowed.
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