TMI Blog2016 (5) TMI 16X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessing officer. We may also add that, if the assessee does not maintain regular cash book and the explanation offered by him was not satisfactory, then the entire amount of market value of shares is required to be assessed as unexplained investment. (b) The difference between the sale consideration of shares and the market value of shares as on 27.04.2005 is required to be assessed as short term capital gain. (c) The AO has estimated the commission expenses @ 5% for procuring long term capital gains. Since we have held that the assessee could not prove the claim of purchase of shares in April, 2004, we are of the view that the Ld CIT(A) was justified in confirming the assessment of commission expenses. Claim of agricultural ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... come. 2. The facts relating to the above said issues are set out in brief. The assessee reported long term capital gain arising on sale of shares named M/s Twenty First Century (I) Ltd amounting to ₹ 33,65,423/- during the year under consideration and claimed the same as exempt. The assessee claimed that he purchased 11500 shares of the above said company on 05-04-2004 for a sum of ₹ 69,250/- by paying cash out of cash balance available with him and also out of agricultural income. The shares were claimed to have been purchased in physical format and sent for dematerialisation in April, 2005 and finally sold in May, 2005. 3. The assessing officer recorded statement from the assessee u/s 131 of the Act, wherein he conf ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hese set of facts, the AO held that the assessee has procured bogus long term capital gains and accordingly assessed the sale proceeds as income of the assessee. Besides the above, the AO also held that the assessee should have paid commission @ 5% for procuring the bogus long term capital gains and accordingly assessed commission expenses @ 5% of the sale consideration. 6. The assessee had declared agricultural income of ₹ 95,460/-. It was claimed that the agricultural income was generated on sale of teak trees and in support of the same, the assessee produced confirmation letters for sale of teak trees. Since the assessee could not produce any documents to show that the agricultural operations were carried on, the AO rejected t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was further claimed that the shares were de-materialised subsequently. However, the undisputed fact remains that the assessee could not produce copies of share certificates, copies of share transfer forms, the copies of correspondences relating to dematerialisation process. On the contrary, it has been established by the assessing officer, the shares have been transferred from the de-mat account of a person named Ballb Bhutra to the de-mat account of the assessee on 27-04-2005. The same clearly contradicts the claim of the assessee. 11. The assessee has claimed to have purchased shares in April, 2004 by paying cash. But the enquiries made with M/s Twenty first century (I) Ltd by the AO reveals that the said company was not in a po ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as unexplained investment. (b) The difference between the sale consideration of shares and the market value of shares as on 27.04.2005 is required to be assessed as short term capital gain. (c) The AO has estimated the commission expenses @ 5% for procuring long term capital gains. Since we have held that the assessee could not prove the claim of purchase of shares in April, 2004, we are of the view that the Ld CIT(A) was justified in confirming the assessment of commission expenses. We order accordingly. 13. The next issue relates to the rejection of claim of agricultural income. Since the assessee has furnished documents with regard to the ownership of lands and confirmation letters supporting the sales, we are of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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