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2015 (12) TMI 382 - ITAT DELHI

2015 (12) TMI 382 - ITAT DELHI - TMI - Addition u/s 68 - unexplained cash credit - CIT(A) deleted addition - Held that:- the assessee has proved to have purchased the shares of ₹ 25,10,000/- in the preceding assessment year duly shown in the balance sheet and then sold the same and shown an amount of ₹ 25,10,000/- as sale proceeds of the share as income, the provisions contained in Section 68 of the Act are not attracted and holding the same as income would tantamount to double taxat .....

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appellant ITO Ward 9(2), New Delhi by filing the present appeal sought to set aside the order dated 11.01.2005 passed by Ld. CIT(A) XII, New Delhi for the Assessment Year 2004-05 on the ground that: Ld. CIT(A) erred in law and on the facts in deleting the addition made u/s 68 of the I. T. Act amounting to ₹ 25,10,000/- on account of unexplained cash credit. 2. Briefly stated, the facts of the case are: that on the basis of information received form Investigation Wing of the Department that .....

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and 142(1) of the Act were also issued and in response thereto, Shri Naresh Sharma, CA and Authorized Representative of the assessee attended the proceedings and filed details and documents called for from time to time. 3. The reasons recorded for reopening of the case were provided to the assessee and in response thereto, the assessee stated as under: Further to notice dated 06.09.2011, it is submitted that the assessee company has received two cheques i.e. en. No. 078035 of ₹ 505000/- an .....

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to M/s Exclusive Garments amounting to ₹ 25.10 Lacs. During the year under consideration. Further the assessee has received total payment from the party for the sales of shares thru account payee cheques only. The assessee was having opening stock of ₹ 142.50 Lacs and there were no purchases during the year. Further the assessee is having sales of ₹ 142.85 lacs during the year under consideration. The assessee company has already filed balance sheet and tax audit report along w .....

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m the detailed report relating to the accommodation entries provided by DIT( Investigation) and from the survey conducted on Mukesh Gupta Group of cases, it was found that accommodation entries were also given through the disguised channels of sales and purchase of shares and they had operated accounts in various banks out of which one of the Bank was Ratanakar Bank, Karol Bagh. From the Bank account called from the entry provider, return u/s 133(6) from Exclusive Garments, it was found being op .....

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Tribunal by way of filling the present appeal. 6. Ld. D.R. challenging the impugned order contended that when the assessee has failed to explain the credit of ₹ 40,40,000/-, provisions contained u/s 68 of the Act are attracted and the A.O. has rightly treated the amount of ₹ 25,10,000/- as undisclosed income of the assessee and has relied upon the order dated 23.11.2011 passed by the A.O. 7. However, on the other hand, Ld. A.R. repelled the contention made by Ld. D.R. by contending i .....

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question have already been shown by the assessee in the balance sheet for the preceding year; that A.O. has not given findings that it was a bogus transaction in the hands of assessee nor pointed out that shares were bogus purchase by the assessee and relied upon the judgements cited as ITO Vs Jatin Investment Pvt. Ltd. I.T.A. No. 4325 and 4326/Del.2009 and in the case of CIT vs Vishal Holding & Capital (P) Ltd. (2011) 200 Taxman 186 (Del.). 8. We have heard Ld. Authorized Representatives of .....

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eturns filed by the assessee to make out if he has already disclosed the purchase of shares in question. ii) that from the perusal of copies of assessment proceedings initiated u/s 147 read with section 143(3) of the Act, pertaining to Assessment Year 2003-04 lying at pages 45-46 of the ledger book, in ledger account showing purchase of shares qua the Assessment Year 2003-04 lying at page 34 which have never been disputed by the A.O., it is abundantly clear that the assessee had purchased the sh .....

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in cash u/s 40A(3) of the Act. v) that when assessee has shown an amount of ₹ 25,10,000/- as sale proceeds of shares as income, there is no ground for making the same as addition in the income which would amount to double addition. vi) that the books of account maintained by assessee have never been disputed by the A.O. nor he has held that the purchase of shares was bogus transaction or the shares sold by the assessee were bogus one. vii) In I.T.O. Vs Jatin Investment Pvt. Ltd. (supra), .....

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n I.T.A. No. 1788/Del/2007 for the Assessment Year 2000-2001 wherein the order of the Ld. CIT(A) making the similar deletion was upheld by observing in para 6 as under:- We are of the view that the assessee had produced copies ) of accounts, bills and contract notes issued by M/s. MKM Finsec Pvt. Ltd., and had been maintaining books of account as per Companies Act. The assessee had also demonstrated the purchase and sale of shares over a period of time as seen from the balance sheet. In our opin .....

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