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2022 (7) TMI 335 - HC - Income TaxReopening of assessment u/s 147 - Eligibility of reasons to believe - loss on transactions of sale and purchase of shares by the assessee - Onus to prove - HELD THAT:- We have carefully examined the aforesaid issue and we are in complete agreement of the findings assigned by the Tribunal inasmuch as that the assessee has discharged its onus to justify the loss claimed by it on purchase and sale of shares. Thus, the tribunal is right in observing that the onus has shifted on the Revenue Department to disprove the same by placing on record contrary evidence. Merely since the Companies and few purchasers have not responded to the notice issued by the Assessing Officer at the stage of reassessment cannot be a reason to discard the evidences placed by the assessee. Even otherwise we could notice that the aforesaid transactions were looked into by the AO during the original assessment and upon due compliance of the procedure envisaged under the Act. AO at the stage of original assessment was satisfied about the genuineness of such share transactions and had thereafter permitted the loss claimed by the assessee towards the share transactions. We are in complete agreement with the findings recorded by the Tribunal that even otherwise the assessee being transferor of shares cannot be subjected to tax in the instant case, more particularly, considering the amendment brought by the Legislation on the statute book in the form of Sections 50CA and 56(2)(x)of the Act, which is applicable with effect from 01.04.2018 and 01.04.2017 respectively. The conjoint reading of both sections, clearly provides that the tax liability if any, arise in such kind of transactions will be applicable in the hands of recipients and no liability can be imposed on the transferor of shares. We cannot accept the submissions of the Revenue to treat the present case as a case of ‘escapement of income’ conferring jurisdiction on the Assessing Officer for reopening the assessment. In fact for the reasons recorded, the Assessing Officer had no jurisdiction to initiate the reassessment under Section 147 read with Section 148 of the Act, more particularly, in absence of any new tangible material found on record. So far the issue of deleting the addition of disallowance of loss claimed on sale and purchase of shares in case of assessee is concerned, as noted above, both the CIT (A) as well as Appellate Tribunal have elaborately discussed the supporting evidence and has individually examined the transactions of each five Companies. - Decided in favour of assessee.
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