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TMI Blog2017 (2) TMI 1190X X X X Extracts X X X X X X X X Extracts X X X X ..... (Appeals) 33, Mumbai [hereinafter referred to as Ld. CIT (A)], the Appellants submit the following grounds for your sympathetic consideration; which it is prayed may be considered without prejudice to each other. l. On the facts and circumstances of the case the The ld. Assistant Commissioner of Income Tax erred in adding in adding in income 2% of alleged unexplained entries, in light of the fact that STT Certificate issued by stock exchange itself supports stand of the appellants that the relevant transactions, if any, are not entered into by the appellants." 3. The brief facts of the case are that the assessee is engaged in the business of share trading. Information was extracted by the AO through Annual Information Report that the assessee has entered into share transactions to the tune of Rs. 20,10,44,369/- through Bombay Stock Exchange(BSE) on various dates. The assessee was asked to explain the sources of purchases/sale of these shares through bank entries. The assessee explained the transactions to a large extent but could not explain many transactions. The assessee had denied to have entered into, in the following share transactions:- Transaction date Amount (Rs.) 28.1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se transactions through BSE wrote to BSE , wherein in response the BSE vide letter dated 22.11.2010 submitted that complete trade details of the assessee were mentioned in Annexure-I for all the quarters respectively which were submitted to ACIT, Mumbai vide letters dated 18.09.2007, 08.12.2007, 1.2.2008 and 15.5.2008. The BSE also stated that details of copies of accounts / certificate, details of cheques etc. are not available with BSE as it does not enter into any transaction directly with the investors. The AO observed that the BSE has directly confirmed the said transactions , which the assessee is denying out-rightly. The A.O. deputed Ward Inspector to verify the reported transactions who confirmed the transactions after verification. The A.O. observed that it is incumbent upon the assessee to reconcile the transactions with BSE and it is not for the Revenue to reconcile the same. The AO observed that no attempt has been made by the assessee to reconcile the same and mere denial by the assessee does not absolve the assessee from her responsibility. The A.O. observed that the amounts mentioned in AIR do not indicate whether the amounts mentioned therein relate to purchase or s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ; we hereby submit the following irrefutable evidence for your kind consideration in the matter. Attention is invited to Securities Transaction Tax certificate issued by the Stock Exchange (Exhibit A) to your appellants. Admittedly this certificate pertains to Securities Transaction Tax charges on all the transactions entered into by your appellants in the relevant year. 06. We also submit herewith the statement showing total of STT charged as per bills of brokers (Exhibit B), it may be noted that Total STT as per this statement matches with total of STT as per certificate issued by the stock exchange. This would imply that even as per stock exchange the only transactions that have been entered into by our client are those that are reflected in the bills of broker because there can not be any transaction conducted on Stock Exchange without levy of STT. 07. This establishes a fact that there is error in the transaction report as may be submitted to the Income Tax Department by the stock exchange because admittedly there can be no error in STT charging and payment by Stock Exchange. 08. It is humbly submitted that in light of the said irrefutable evidence, the addition, which is s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as charged by Bombay Stock Exchange Ltd. on the total value of transactions entered during the F.Y. 2007-08 relevant to A.Y. 2008-09 reflected at Rs. 32,94,49,013.30. Since the appellant has claimed rebate of STT for Rs. 2,56,963/- (for which ground No. 2 was taken in appeal and has now being withdrawn for the reason that same has already been given effect to by the A.O. by passing order u/s. 154 dt. 28.1.2011), it is clear that STT of Rs. 2,56,963/- was paid on total turnover of Rs. 32,94,49,013.30 by the appellant. This is undisputed fact for which appellant has claimed by way of ground No. 2 in appeal also and which has been accepted and given effect to by the A.O. also by giving effect to vide order u/s. 154 dated 28.01.2011. Now having claimed rebate for STT paid of Rs. 2,56,963/- as per this very certificate which was filed by the appellant in Form No. 10DB, now the appellant cannot deny the volume of transaction reflected in that very certificate at Rs. 32,94,49,013.30. Here in appeal by taking ground No. l, the appellant is asking the rebate u/s. 88E for STT of Rs. 2,56,963/- on one hand, but is denying that total transactions are not of the volume reflected in same certif ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ave to be considered for rebate given of STT paid and given effect to as per the certificate at Rs. 2,56,963/-. In view of this, the ground no. 1 is dismissed. Thus, the ld. CIT(A) dismissed the appeal filed by the assessee and upheld the additions made in the assessment order dated 15.12.2010 passed by the AO u/s 143(3) of the Act, vide appellate order dated 26.12.2011. 5. Aggrieved by the appellate order dated 26.12.2011 passed by the ld. CIT(A), the assessee filed second appeal before the Tribunal. 6 The ld. Counsel for the assessee submitted that the addition has been made by the A.O. based upon the AIR information. The learned counsel for the assessee submitted that no addition can be made based upon the AIR information. It was submitted that bank statements were submitted as well certificate from BSE was produced wherein details of STT paid was reflected. Thus , no addition can be made based upon AIR information was the contention of learned counsel for the assessee. The assessee relied upon various case laws which are placed in paper book filed by the assessee with the tribunal to contend that additions based on AIR information is not sustainable. 7. The ld. D.R. on the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aintained by the assessee. The assessee has denied to have entered into such transactions but while claiming STT rebate , the assessee has admitted to have entered into these un-reported and un-reconciled transactions of Rs. 7,52,65,347/- . It is also observed that the BSE vide its letter dated 22-11-2010 has also re-confirmed these traded share transactions to the tune of Rs. 7,52,65,347/- which had been denied by the assessee to have not been entered into. The AIR information relied upon by the AO was generated out of transactions recorded in BSE which was reported to Revenue by BSE . It was incumbent upon the assessee to reconcile the same and more so when STT rebate of Rs. 2,56,963/- is claimed by the assessee on trade transactions to the tune of Rs. 32,94,49,013.30 reported by BSE through AIR information , and not against the recorded trade transactions of Rs. 24,28,98,229/- as recorded in books of accounts maintained by the assessee. The case laws relied upon by the assessee are distinguishable and hence cannot be relied upon so as to the extent of quashing the additions made by the authorities below as in the instant case the assessee had herself admitted to have paid STT of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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