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2023 (3) TMI 413 - HC - Income TaxValidity of reopening of assessment - allegation that assessee taken a fictitious loan from an accommodation entry provider and had entered to fictitious purchases of shares of unlisted companies in the aforementioned FY - argument of difference between the show cause notice issued under Section 148A(b) and the impugned order passed under Section 148A(d) - HELD THAT:- In the reply, the petitioner took the position that insofar as the allegation leveled that she had taken a fictitious loan from Mr Jignesh Shah is concerned, the same is not correct. The petitioner says that she has not entered into any transaction with Mr Jignesh Shah. The contract notes generated during the course of the transactions were submitted along with reply. It was also asserted by the petitioner that all transactions were made through banking channels. The petitioner took the position that the shares of the aforementioned entities were sold in the succeeding AY i.e., AY 2017-18 via Screen Based Real Time trading mechanism, provided by the National Stock Exchange, via SMC Global Securities Limited. As asserted by the petitioner that securities transaction tax had been paid on the sale of shares. It is also averred that short term capital gain earned on the sale of the said shares was offered for levy of tax at the rate of 15% under Section 111A of the Act, in AY 2017-18. It is not in dispute that insofar the explanation offered by the petitioner that it had not entered into any transaction with Mr Jignesh Shah is concerned, it had been accepted. In the impugned order, the Assessing Officer (AO) seems to have completely gone off the rails i.e., in a completely different direction, by adverting to the fact that petitioner/assessee entered into two sale transactions concerning penny stock scrips of Prikh Herbals Ltd./Safal Herbs Ltd. The sale transaction, as disclosed in the impugned order, is pegged at Rs.18,35,000/-. Clearly, there is a dissonance between the show cause notice issued under Section 148A(b) and the impugned order passed under Section 148A(d) of the Act. Thus the impugned order and notices are set aside. Liberty is, however, given to the Assessing Officer (AO) to carry out the exercise de novo, albeit, as per law.
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