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2022 (9) TMI 155 - AT - Income TaxValidity of Reopening of assessment u/s 147 - addition u/s 68 - whether original return of income was not taken up for scrutiny assessment? - HELD THAT:- AO noted that the assessee has not disclosed the above transaction in the return of income filed. After appraisal of these materials on record, there is enough reason to believe that the assessee has clearly failed to disclose all material facts for determination of income. This information along with the material on record constitutes a tangible material to form the belief that the income assessable to tax and claimed as exempt from tax has escaped assessment. Once the original return of income was not taken up for scrutiny assessment, then the said information and facts discovered by the Investigation Wing Kolkata constitutes a material on the basis of which the AO can reasonably form a belief that the income in the shape of long term capital gain claimed as exempt has escaped assessment within the meaning of section 147 - At the stage of reopening of the assessment what is required is prima facie reason to believe that income assessable to tax has escaped assessment and the AO is not required to establish the fact by legal evidence or conclusion. Accordingly we do not find any error or illegality in the impugned order of CIT (A) qua this issue. This ground of the assessee is dismissed. Bogus sale of shares claimed u/s 10(38) - Penny stock - As in the absence of any contrary material or evidence brought on record by the AO, the transaction of purchase and sale of the shares in question cannot be held as bogus merely on the basis of Report of the Investigation Wing of the Department in some other cases where some persons were found indulged in providing accommodation entry, and further it cannot be held that the assessee has introduced his own unaccounted money by way of bogus long term capital gain. Taking into consideration various documentary evidences produced by the assessee in support of his claim and further relying upon various decisions of this Tribunal as well as the decision of Hon’ble Jurisdictional High Court including the decision in case of CIT vs. Pooja Agarwal [2017 (9) TMI 1104 - RAJASTHAN HIGH COURT] as well as in case of PCIT vs. Pramod Jain & Others [2018 (2) TMI 300 - ITAT JAIPUR]. we allow the claim of exemption under section 10(38) of the Act and accordingly delete the addition made by the AO. The order of ld. CIT (A) is set aside. Commission paid for the accommodation entries - As when we have given a finding that the transaction of purchase and sale of shares and consequential Long Term Capital Gain cannot be treated as bogus, then the addition made by the AO on account of notional commission paid treating the same as undisclosed expenditure under section 69C will not be sustainable being consequential hence the same is deleted.
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