TMI Blog2021 (2) TMI 531X X X X Extracts X X X X X X X X Extracts X X X X ..... stock exchange. The inflow of shares is reflected by way of physical share certificate and demat account. The shares were transferred through demat account. There is no evidence that the cash was recycled back to the assessee. The assessee merely acted on the basis of such market information and happened to get phenomenal gain. It could have been otherwise as well. The rags to riches story in the stock market are galore. It has been submitted that the alleged, circumstantial evidence and material has led the Assessing Officer to believe that the real is not the apparent. In the absence of any link between the assessee and the alleged admissions of the directors and brokers, human probability is being used as a vague and convenient medium for the department s conjectures - Decided in favour of assessee. - ITA Nos.05 And 06/SRT/2019, ITA Nos.07 And 10/SRT/2019 - - - Dated:- 7-1-2021 - Shri Pawan Singh, JM And Dr. A.L. Saini, AM For the Assessee : Shri Rasesh Shah -CA For the Respondent : Ms Anupama Singhla -Sr. DR ORDER PER DR. A. L. SAINI, ACCOUNTANT MEMBER: The Captioned four appeals filed by the different assessees, pertaining to the Assessment Ye ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... raised the grounds on merits. However, at the time of hearing, the main grievance of the assessee has been confined to the reassessment proceedings under section 147/148 of the Act (technical issue). 6. The assessee before us is an individual and employed in Timber related Industries. He derived income from other sources and Long Term capital gain during the year under consideration. The case of the assessee was reopened under section 147 of the Act, since information was received from Investigation Wing of Kolkata, which had carried out survey/ search operations wherein it was established that in large number of penny stock companies the share prices were artificially raised on the Stock Exchanges in order to book bogus claims of Long Term Capital Gain/Loss. The assessing officer observed that the information as per EPS / ITS / Penny Stock reflected that the assessee had shown Long term Capital Gain of ₹ 20,76,924/- on which STT has been paid, which is claimed as exempt and the scrip Global Securities Ltd, is one of the Penny Stock companies utilized by Brokers for providing accommodation entries. Therefore, the assessee`s case was reopened under section 147 of the Act t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ntire 15000 shares on 28.02.2013 and 01.03.2013 through the broker Arcadia Share and Stock Brokers Pvt. Ltd. Mumbai after dematerialization on 08.11.2012. It was noted that the assessee made a gain of almost 11100% in a span of around fifteen months and within three months after dematerialized of these shares. Some points that were to be prima facie noted by the assessing officer based on information and submission made by the assessee, are as follows: (i). The scrip was named in Kolkata Investigation Report titled Project Bogus LTCG/STCL through BSE Listed penny stocks prepared by DDIT(Inv), Unit 2(3). (ii).There are statements by the promoters, brokers and associated persons, who have on record confirmed the involvement of Global Securities Ltd. in the stock price manipulation. (iii).The assessee derived income from salary and other sources. (iv). Assessee has invested in shares of the company, Global securities Ltd. which had no worthwhile credential on record. (v). Assessee is not an ardent trader in shares rather had invested in only handful of shares in his life. (vi).The purchase of the shares of Global Securities Ltd were off market transactions where ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ause notice of the Assessing Officer, the assessee submitted that there is no condition stipulated as per section 10(38) of the Act regarding the timing of dematerialization of shares. Assessee submitted debit note, and delivery challan pertaining to the shares purchased. The securities transaction tax (STT) has been paid. The sale consideration was received through banking channel. The assessee has given instructions to the stock broker i.e. M/s. Arcadia Share Stock Broker Private Limited to sell the shares, as and when he found price of shares to be reasonable based on market trend, without indulging into the process of selling the share in open market and not knowing to whom the shares were sold. In this process the assessee sold shares from Jan 2013 to March 2013. M/s. Arcedia Share Stock Broker Private Limited has been authorized to maintain demat accounts that are also registered stock brokers of Bombay Stock Exchange. No action against M/s. Arcedia Share Stock Broker Private Limited has been taken either by BSE or by SEBI for alleged indulgence referred by assessing officer in the show cause notice. 9. However, the Assessing Officer rejected the contentions of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Assessing Officer. The broker company through which shares were sold did not respond to queries, hence the fantastic sale price realization is not at all humanly probable, as there is no economic or financial basis that a share of little known company would jump abnormally. In these circumstances, ld CIT(A) did not find any infirmity in the order of the Assessing Officer. Accordingly, he held that the transactions in purchase and sell of shares of M/s. Global Securities Ltd. for ₹ 20,95,674/- were sham transactions intended to claim wrong exemption u/s 10(38) of the income-tax Act, thus he upheld the addition of ₹ 20,76,924/-, made by the Assessing Officer. The assessee did not challenge the technical issue of reopening the assessment under section 147/148 of the Act before the ld. CIT(A), therefore ld. CIT(A) did not give any opinion on the said technical issue. 12. The ld CIT(A) also observed that since the assessee has paid commission @ 5% of ₹ 20,76,924/- to the entry operator/broker for purchase and sale of sham transactions to bring unaccounted money in the guise of exempted long term capital gains, therefore, addition in respect of payment of commissio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er section 151 of the Act is not in accordance with law. The assessee submitted that the Assessing officer has given the letter of approval dated 13.02.2017 wherein it was just mentioned that proposal of reopening u/s.147 was approved without giving reasons. So, there is nonapplication of mind by sanctioning authority as it was mentioned just Yes and Approved without giving any reasons. Therefore reassessment proceedings initiated against the assessee may be quashed. 16. On the other hand, Ms Anupama Singla, ld. Departmental Representative for the Revenue submitted before the Bench that first of all, the assessee has not raised any ground of appeal about validity of reassessment proceedings under section 147 of the Act, before the ld CIT(A), therefore assessee cannot raise a fresh ground (Additional Ground) before the Tribunal. She has submitted written submission before the Bench on the issue of additional ground, which is reproduced below ( To the extent relevant for our analysis): Though the Hon'ble ITAT has the discretion to admit additional grounds, the discretion can be exercised only if the appellant is in a position to show the cause as to what prevented him ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vestigation Wing Kolkata, has applied his mind and then after issued the notice under section 148 of the Act. She took us through page No. 76 of the paper book where reasons were recorded and pleaded that in last para of the reasons recorded, the assessing officer has clearly mentioned that he had reason to believe that chargeable income has escaped assessment. The last para of the reasons recorded vide paper book page No. 76 reads as follows: In view of the proceedings conducted by the Investigation Wing, Kolkata and after perusal of the information received from the Investigation wing, Kolkata as well as available data, I have reason to believe that income to the extent of ₹ 20,76,924/- has escaped assessment for A.Y. 2013-14 by reason of failure on the part of the assessee to disclose fully and truly all material facts necessary in the return of income. Hence, notice u/s. 148 r.w.s 147 of the Income tax Act, 1961 is to be issued for the assessment year 2013-14. Thus, she pointed out that assessing officer after getting the information from the Investigation wing, Kolkata, has examined the said information and then he got satisfaction, hence there is no defect in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as perused the reasons and stated that on the facts of the case, she is satisfied that it is a fit case for issuance of notice under section 148. It is not a case wherein she has just mentioned approved . The relevant extract is reproduced hereunder 13 Whether the Jt. Commissioner of the Income tax is satisfied on the reasons recorded by the A.O. that it is a fit case for issue of notice u/s. 148 of the Act. Yes, on the facts of the case, I am satisfied that this is a fit case for issue of notice u/s. 148 of the IT. Act. Cross Examination The assesse has relied on the apex court decision in the case of Andaman Timber Industries vs. Commissioner of Central Excise (2015) [281 CTR 0241] (SC). In this case, since cross examination was not provided, the appeal was decided in favor of the assessee. However, the ratio laid down therein is not applicable to the Income Tax proceedings, since the judgment was delivered in context of Central excise laws. There is a specific provision of cross examination, to be given by the Central Excise Authorities, in adjudicating the manuals of Customs and Central ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es, the technical consideration and substantial Justice are pitted against each other, then in that eventuality the cause of substantial Justice deserves to be preferred and cannot be overshadowed by such technical considerations. Since the assessee did not raise the said legal issue (validity of reopening proceedings) before the ld CIT(A) does not mean that he cannot raise this legal issue before the Tribunal. The assessee may raise legal issue at any stage for that we rely on the judgment of the Hon`ble Supreme Court in the case of National Thermal Power Co. Ltd Vs. CIT (1998), 229 ITR 383(SC). 5. Under section 254 of the Income-tax Act, 1961, the Tribunal may, after giving both the parties to the appeal an opportunity of being heard, pass such orders thereon as it thinks fit. The power of the Tribunal in dealing with appeals is, thus, expressed in the widest possible terms. The purpose of the assessment proceedings before the taxing authorities is to assess correctly the tax liability of an assessee in accordance with law. If, for example, as a result of a judicial decision given while the appeal is pending before the Tribunal, it is found that a non-taxable item is taxe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e raised. But where the Tribunal is only required to consider a question of law arising from the facts which are on record in the assessment proceedings we fail to see why such a question should not be allowed to be raised when it is necessary to consider that question in order to correctly assess the tax liability of an assessee. Thus, from the aforesaid dictum of the Hon`ble Supreme Court in the case of National Thermal Power Co. Ltd (supra), it is abundantly clear that Tribunal under section 254 of the Act has power not only to decide the grounds which arise from the order of the Commissioner (Appeals) but it has also power to decide questions of law arising in assessment proceedings although not raised earlier. Therefore, we do not agree with the contention of Ms. Anupama Singla (ld DR) to the effect that since the legal issue does not emanate from the order of ld CIT(A) therefore additional ground should not be admitted by the Tribunal. Since the additional ground raised by the assessee, challenging the validity of the reassessment proceedings is a legal issue which goes to the root of the matter therefore we admit such legal issue for adjudication. 19. Coming to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the proceedings conducted by the Investigation Wing, Kolkata and after perusal of the information received from the Investigation wing, Kolkata as well as available data, I have reason to believe that income to the extent of ₹ 20,76,924/- has escaped assessment for A.Y. 2013-14 by reason of failure on the part of the assessee to disclose fully and truly all material facts necessary in the return of income. Hence, notice u/s. 148 r.w.s 147 of the Income tax Act, 1961 is to be issued for the assessment year 2013-14. Place: Bharuch Dated: 10.02.2017 [MUKESH KUMAR] Income-TAX Officer, Ward-2(2). Bharuch. 20. Now, we shall analyze the reasons recorded, as follows: We note that second para of the reasons recorded contains only general information; the said general information is not in the context of the assessee. At the cost of repetition but for the sake of convenience the second para of the reasons recorded is again reproduced below: In this case, information is received from the Investigation Wing, Kolkata who had carried out survey / search operations wherein it was established that in large number of penny stock companies share prices w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nvestigation wing, Kolkata as well as available data, I have reason to believe that income to the extent of ₹ 20,76,924/- has escaped assessment for A.Y. 2013-14 by reason of failure on the part of the assessee to disclose fully and truly all material facts necessary in the return of income. Hence, notice u/s. 148 r.w.s 147 of the Income tax Act, 1961 is to be issued for the assessment year 2013-14. We note that above proceedings were not conducted by the Investigation Wing, Kolkata, with reference to the assessee under consideration. The proceedings conducted by the Investigation Wing, Kolkata was not related to the assessee but it was related to other assessees. 23. Thus, it is abundantly clear from our above analysis of reasons recorded that assessing officer used the general information available with Investigation Wing Kolkata. This Information is not a tangible material which can suggest that in assessee`s case the income chargeable to tax has escaped assessment. The statement taken on oath u/s.131 of the Income Tax Act of Shri Sanjay Vora, does not contain the name of the assessee and it does not relate to broker of assessee, moreover, the assessee did no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reasons for starting the proceedings given in the separate sheet may be fully reproduced. For the reasons hereinafter recorded I believe that income, profits and gains earned by the assessee in his personal capacity and in conjunction with others and chargeable to income-tax have escaped assessment and that the amount of such concealed income relating to the accounting years covering the period beginning on the 1st day of September, 1939; and ending on the 31st day of March, 1949, amount to or is likely to amount to ₹ 1,00,000.The reason for such belief, inter alia, is as follows: (1) The assessee who is or was at the relevant time a managing director in about a dozen limited companies alongwith Oberois is believed to have made some secret profits which were not offered for assessment. (2) The assesseeis believed to have received asum of₹ 22 lakhs from Oberois and this sum or at least part of which represents income which has escaped assessment. (Sd.)A. K. Bhowmik Income-tax Officer, Dist. II(2), Calcutta. It is abundantly clear that the two reasons which have been given for the belief which was formed by the Income-tax Officer h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... asons for the belief cannot be investigated by the court. There is no material or fact which has been stated in the reasons for starting proceedings in the present case on which any belief could be founded of the nature contemplated by section 34(1A). The so-called reasons are stated to be beliefs thus leading to an obvious self-contradiction. We are satisfied that the requirements of section 34(1A) were not satisfied and, therefore, the notices which had been issued were wholly illegal and invalid. 25. We note that in assessee`s case, the assessing officer received information from the Investigation Wing, Kolkata who had carried out survey / search operations wherein it was established that in large number of penny stock companies share prices were artificially raised/manipulated on the Stock Exchanges in order to book bogus claims of Long Term Capital Gain / Loss. We note that on the basis of the information received from another agency, there cannot be any reassessment proceedings. However, after considering the information/material received from other source, the Assessing Officer is required to consider the material on record in case of the assessee and thereafter is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... incipal Director of Income Tax (Investigation), Ahmedabad, reassessment proceedings have been initiated on the ground that the income escaped assessment. However, there is no assertion regarding the basis on which material on record, he has come to such conclusion. Therefore, the material on the basis of which the A.O. seeks to assume the jurisdiction under section 147 if the Act is the information received from the external source viz. the Principal Director of Income Tax (Investigation), Ahmedabad. It cannot be disputed that on the basis of the information received from another agency, there cannot be any reassessment proceedings. However, after considering the information/material received from other source, A.O. is required to consider the material on record in case of the assessee and thereafter is required to form an independent opinion on the basis of the material on record that the income has escaped assessment. Without forming such an opinion, solely and mechanically relying upon the information received from other source, there cannot be any reassessment for the verification. 5.4 At this stage it is required to be noted that even in the reasons recorded, there is no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uld like to mention that sanction for issue of notice under section 151 is in accordance with law, as the JCIT has gone through the facts and then approved it, hence there is no irregularity so far sanction for issue of notice under section 151 is concerned. 28. In the result, appeals filed by the assessees in ITA No.05/SRT/2019 and ITA No.06/SRT/2019 are allowed. 29. Now we shall adjudicate the appeals pertaining to Assessment Year 2014-15. For the sake of convenience, the facts as well as grounds of appeal narrated in the assessee s appeal in ITA No.07/SRT/2019, for AY.2014-15, in the case of Smt. Muktaben N Patel, is taken as the lead case. 30. The grounds of appeal raised by the assessee as per its lead case in ITA No.07/SRT/2019 for AY.2014-15 are as follows: 1. On the facts and circumstances of the case as well as law on the subject, the learned Commissioner of Income Tax (Appeals) has erred in confirming the action of the assessing officer in disallowing the exemption of ₹ 29,08,385/- claimed by assessee u/s.10(38) on account of Long-Term Capital Gain and treating it as the accommodation entry and thereby making addition u/s. 68 of the Act. 2. On the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... decisions has conclusively held that assessment of income under the provisions of the income-tax Act cannot be made merely on suspicion or surmises but it should be based on the concrete material and more particularly while invoking provisions of section 68 of the Act and additions, if made any, would not be sustainable at higher forum. Your honour would appreciate that had it been a transaction other than on stack exchange or it had been done contrary to the provisions of SEBI as well as of BSE; the stock broker would have been penalized or debarred from the stock exchanges. Nothing of that sort happened which itself indicate that transaction entered into by your assesses is genuine and correct and which is supported by the information available at BSE. Any farther doubt raised against the genuineness of transaction is best left upon your honour as doubting the competency of SEBI which is an autonomous body. It is this background, we offer our comments as below on the concerns/ apprehension/ suspicion made in the show cause notice which prompted your honour to issue show cause as to why amount received on sale of shares should not be taxed within the meaning of section 68 of the A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gain momentum. (iv) Contract notes issued by Broker M/s Tradebulls Securities Pvt. Ltd, indicates BSE Settlement No in which sale was executed, date on which sale was executed, price at which sale was negotiated, brokerage charged by them; STT paid by the assessee and deducted from the consideration payable to the assesses, BSE transaction charges, stamp duty and other charges deducted from the sale consideration. Your honour would appreciate that brokerage charged is the same as has been charged from other clients and is not unusual to give rise of suspicion for dubious or doubted nature of transaction. Allegation that price of share remained high for almost one year because these were accommodation entry transactions is without any substance because it is difficult to be maintained in free stock market wherein anyone can buy and sell any quantity of shares both by way of delivery or through intra-day transactions and therefore, possibility of manipulation in the price of shares was remote, more particularly when open market transactions cannot be controlled by any one. (v) Transactions reflected in the assessee's demat account also mentions all transactions includin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent recorded u/s 133A of the Act but without any supporting material or any materiel impounded in the course of survey. Statements of this nature have no evidentiary value as held by Hon'ble Supreme Court in S Kader Khan and other cases. We also find that name of the stock broker does not appear in the entire statement because transactions entered into by the assesses was an independent transaction than the transactions those referred in the said statement. Further, no specific question has been asked in relation to dealings in the shares of M/s Sun and Shine Worldwide Ltd, purchased or sold by the assessee or in relation to her stock broker i.e. M/s Tradebulls Securities Pvt. Ltd. We, therefore, submit that no adverse view con be taken from the statement of Shri Anil Kumar Khemka in the present case. (x) We submit that allegation leveled against the assessee, that he took advantage of long term capital gain for the purpose of tax evasion. We submit that assertion made by you is without any substance. The assessee acquired shares in the previous year and have been duly disclosed in by books as already furnished before Your honours. Sources from which these shares had ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lips of transfer of shares either at the time of assessment proceedings or during the course of appellate proceedings. (ii) Financial health of M/s. Sun Shine Worldwide Ltd. did not improve to an extent to have spiraled the price of shares many times within a short span of time and (iii) The findings of the investigation wing where the entry operators had accepted the modus operandi of providing bogus LTCG through purchase and sale of shares of few companies. The assessee has stated that he had acquired 35500 shares of M/s. Sun Shine Worldwide Ltd, @ ₹ 0.55 per share on 30.10.2012 from M/s Corporate Commodity Brokers Pvt. Ltd through private placement. The shares of M/s. Sun Shine Worldwide Ltd. were having market price of share at around ₹ 21.90 in 15 months. After that the price was fell down tremendously, and purchase price of shares declared by the assessee were not in conformity with the rates prevailing on the respective dates, and the lowest and highest price quoted does not match with the purchase price shown by the assessee. It is evident that when at the time of booking of LTCG the share price tremendously on a higher side and thereby bogus gain ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed that it was an entry of bogus long term capital gain by paying unaccounted income. 34. Based on the above facts, the assessing officer made two additions, which are as follows: (i).Since, the entry operator Shri Anil Khemka in his statement taken on oath under section 133A of the Act has stated that he received ₹ 0.10 paisa on such transactions, therefore, assessing officer made addition of ₹ 2,87,047/-( ₹ 0.10 of ₹ 28,70,475). (ii).Addition of ₹ 29,08,384/-, being income earned from undisclosed sources not offered for taxation during the year. 35. Aggrieved by the order of the Assessing Officer, the assessee carried the matter in appeal before the ld. CIT (A) who has confirmed the addition made by the Assessing Officer. Before the ld CIT(A) the assessee has filed written submission along with copy of Share Transfer Form and Bank Statement and other documents. However, ld CIT(A) observed that on a close observation, it transpires that the authenticity of the said transfer form is doubtful and does not give strength in support of the claim of the assessee. From the Bank Statements, it revealed that the assessee has opened the particula ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of M/s Tradebulls Securities Pvt Ltd, in alleged price, rigging or arranging accommodation entries. The Ld Counsel submitted that Assessing Officer had put serious allegations relating to the genuineness of the transactions, in the Assessment Order without any cogent reasons. During the assessment stage the assessee submitted Contract notes issued by Broker M/s Tradebulls Securities Pvt. Ltd, indicating BSE Settlement number in which sale was executed, date on which sale was executed, price at which sale was negotiated, brokerage charged by them; STT paid by the assessee and deducted from the consideration payable to the assessee, BSE transaction charges, stamp duty and other charges deducted from the sale consideration etc, were submitted before the assessing officer. The consideration was received through banking channel which was credited in assessee's savings bank account with Oriental Bank of Commerce. The assessing officer had referred to the statement recorded u/s 133A of Shri Anil Kumar Khemka, the said statement does not implicate the assessee adversely in any manner. It is a statement recorded u/s 133A of the Act without any supporting material or any material impo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in schedule A-0I of ITR which was claimed as exempt u/s 10(38) of the Act and the same was not credited to Income and Expenditure a/c and was shown in the Capital Account for the A.Y. 2014- 15.The assesse purchased shares of M/s.Sun and Shine Worldwide Limited through private placement (offline). It was observed that the assessee allegedly purchased 35500 shares from M/s Corporate Commodity Brokers Private Limited on 30/10/2012. The payment for this transaction was made through cash on 30.10.2012. Subsequently, the shares were given for dematerialization, nearly after one year from the receipt of original share certificate. Thereafter, in the months of February 2014 and March 2014, the entire shares were sold for ₹ 29,08,385/- through broker M/s Tradebulls Securities (p) Ltd, through the platform of BSE . The assessing officer issued notices under section 133(6) to the various entities such as M/s. Sun and Shine Worldwide Limited, M/s Corporate Commodity Brokers Private Limited and Bombay Stock Exchange. The assessing officer observed from the reply received from M/s Corporate Commodity Brokers Pvt. Ltd. that shares were purchased for ₹ 2/- each and total amo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he assessee's demat account one year after the receipt of original share certificates. We not that no violation of any laws has been brought on record in relation to transferring of shares to the assessee through transfer (private placement) route. Even in that matter there was no dispute with regard to the pricing of shares of transfer of shares through private placement. Nothing has been brought on record by the assessing officer to show that amount invested by the assessee in shares was in the nature of accommodation entry. No financial transaction between promoters of M/s Sun Shine Worldwide Ltd and the assessee have been brought on record that the assesses had paid any unaccounted funds to them in order to get the said money back by way of sale of shares through stock exchange. Both seller and purchaser on the stock market are unknown to each other when transactions are done at stock exchange. Shares sold by the assessee were open market transactions and not through black deal and therefore, transactions executed by the assessee at BSE through BSE registered stock broker cannot be treated as bogus as explained by ld Counsel. No such cogent evidence or material has ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gs of the Hon'ble Supreme Court in the said case is reproduced below: 6. What is more relevant, in the instant case, is that the attention of the CIT(A) and the Tribunal was rightly invited to the circular of the CBDT dt. 10th March, 2003 with regard to the confession of additional income during the course of search and seizure and survey operations. The said circular dt. 10th March, 2003 reads as follows : ........Instances have come to the notice of the Board where assessees have claimed that they have been forced to confess the undisclosed income during the course of the search and seizure and survey operations. Such confessions, if not based upon credible evidence, are later retracted by the concerned assessees while filing returns of income. In these circumstances, on confessions during the course of search and seizure and survey operations do not serve any useful purpose. It is, therefore, advised that there should be focus and concentration on collection of evidence of income which leads to information on what has not been disclosed or is not likely to be disclosed before the IT Department. Similarly, while recording statement during the course of search ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... particularly, when the CIT(A) and the Tribunal followed the circular of the CBDT dt. 10th March, 2003, extracted above, for arriving at the conclusion that the materials collected and the statement obtained under s. 133A would not automatically bind upon the assessee, we do not see any reason to interfere with the order of the Tribunal. Accordingly, finding no substantial question of law arises for consideration, the tax case appeal stands dismissed We note that name of the stock broker does not appear in the entire statement because transactions entered into by the assessee was an independent transaction than the transactions those referred in the said statement. Further, no specific question has been asked in relation to dealings in the shares of M/s Sun and Shine Worldwide Ltd, purchased or sold by the assessee or in relation to her stock broker i.e. M/s Tradebulls Securities Pvt Ltd. Therefore, we are of the view that no adverse view can be taken from the statement of Shri Anil Kumar Khemka in the assessee`s case. 41. We note that no violation of provisions of Companies Act has been brought on record by the assessing officer in relation to transfer of shares. Allega ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mat account. Genuineness of contract notes or demat accounts have not been disputed even in the show cause notice by the assessing officer. The Ld Counsel also stated that in the course of assessment proceedings, the Assessing officer made inquiry with M/s. Corporate Commodity Broker Private Ltd. from whom assessee purchased shares. He stated that he sold the shares at ₹ 2/- not at ₹ 0.55/-. This doesn t help the revenue as Corporate Commodity Broker Private Ltd. has only confirmed the sale of the shares to the assessee. Assessee purchased the shares on 30.10.2012 relevant to A.Y. 2013-14. No adverse inference was drawn in this regard in the Assessment order u/s.143(3) r.w.s 147 on 27.12.2017, by the assessing officer in the case of assessee. In order to prove the Sale of shares of Sun Shine Worldwide Ltd., assessee filed the following documents before the assessing officer, viz: Ledger Account of Tradebulls Securities Pvt. Ltd, Contract Notes of Tradebulls Securities Pvt. Ltd and Bank Statement. In order to prove purchases of shares, assessee filed the following documents, viz: Contra confirmation of broker M/s. Corporate Commodity Broker Private Ltd, Share Cer ..... X X X X Extracts X X X X X X X X Extracts X X X X
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