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TMI Blog2019 (1) TMI 1869X X X X Extracts X X X X X X X X Extracts X X X X ..... Appeals-II has erred in facts and in law, in confirmed addition Amount of Rs. 5,26,461/- as a Income from other sources, which Learned Income tax Officer has added as a unexplained credit u/s.68 of Income Tax Act. The Learned Income Tax Officer has also not granted Long Term Capital gain U/s.10(38) of I.T. Act. 2. The Assessment made U/s.143(3) r.w.s. 147 is invalid, as it was made beyond the period of limitation laid down in section 153 of the Act. 4. The first issue raised by the assessee is that the Ld. CIT(A) erred in treating the Long Term Capital Gain (LTCG) as income from other sources amounting to Rs. 5,26,461/- only, consequently, denying the exemptions claimed u/s 10(38) of the Act. 5. Briefly stated facts are that the assessee is an individual and declared his income under the head "other sources" besides the LTCG. The assessee has shown LTCG income of Rs. 5,26,461/- on the sale of shares M/s Talent Infoway Limited which was claimed as exempt u/s 10(38) of the Act. The transaction for the sale of shares was carried out through Mahasagar Group of companies. 5.1. However, the Assessing Officer was of the view that the impugned LTCG income was not from the genuine tran ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... contract note issued by the Stock Exchange is bogus. Therefore, the capital gain income as claimed exempt u/s 10(38) of the Act is not eligible for such an exemption. Accordingly, the Ld. CIT(A) confirmed the order of the Assessing Officer. 9. Being aggrieved by the order of the Ld. CIT(A), the assessee is in appeal before us. 10. The Ld.AR before us submitted that in the identical facts and circumstances, the Hon'ble ITAT in the case of Ketulkumar D. Jaiswal vs. ITO in ITA No. 546/AHD/2015 vide order dated 28/09/2017 had decided the issue in favor of the assessee. Accordingly, the Ld. AR requested before us to allow his ground of appeal. 11. On the other hand, the Ld. DR submitted that the broker through whom the assessee transferred shares was not holding the valid certificate from the Stock Exchange. As such, the broker was debarred from the Stock Exchange. The Ld. DR vehemently supported the orders of the authorities below. 12. We have heard the Ld. Representatives appearing for the respective parties. We have perused the relevant materials available on record. At the outset, we note that in the identical facts and circumstances, the Hon'ble ITAT Ahmedabad in the case of K ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... agreed by the Representatives of both the sides; since the facts are common in all the impugned appeals, all the appeals by the assessees are allowed. The Assessing Officer is directed to treat the surplus as Long Term Capital Gains and allow the exemption a claimed by the assessees. 20. In the result, all the appeals filed by the assessees are allowed." 4.3 Learned AR also cited an order of Mumbai Bench in ITA No.7859/M/2011 for Asst. Year 2003-04, in the matter of Shri Jatin P. Ajmera vs. ITO, relevant Para is reproduced hereunder: "3. Before the Ld. C1T(A), it had been contended that the 14200 shares of Buniyad Chemicals Ltd were purchased in cash for Rs. 8,520/- on 05/06/2001 through sub-broker M/s.Gold Star Finvest Pvt. Ltd and they were transferred in name of assessee in the companies records on 30/06/2001 and then sold through the same sub-broker M/s. Gold Star Finvest Pvt. Ltd. on 27/01/2003 for Rs. 12,00,610/- i.e. after holding them for more than 1 year. The shares purchased and sold were backed by the contract notes issued by sub-broker M/s. Gold Star Linvest Pvt. Ltd. who was registered member of stock exchange and having SEBI registration number and that the sale ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Star Finvest Pvt. Ltd. The Tribunal allowed the appeal of the assessee observing as under: "6.1 We have considered the rival submissions made by both the sides, perused the orders of the Assessing Officer and the CIT(A) and the Paper Book filed on behalf of the assessee. From the copy of the share certificate, Demat account, share transfer form filed in the Paper Book, we find the assessee has purchased 9500 shares of Kushal Software Ltd. from M/s. Handful Investors Pvt. Ltd. We find the Assessing Officer treated the sale of such shares by the assessee through M/s. Gold Star Finvest Pvt. Ltd. as bogus on the ground that Mr. Choksi and his broking company were engaged in giving false share transaction bills. However, from the copy of the statement of Mr. Choksi, a copy of which is filed in the Paper Book, we find Mr. Choksi has not specifically mentioned the name of the assessee for obtaining benefit on sale of such bogus shares. The learned DR also could not point out from the statement of Shri Choksi that he has taken the name of the assessee for obtaining any benefit on issue of such bogus bills. Considering the totality of the facts of the case and considering the fact that t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... owever, as held by the Tribunal in the case of Rajinidevi A. Chowdhary [cited supra], which is on similar set of facts, the AO could have verified from the Registrar of companies as to whether the shares have been transferred and the names of the shareholders in whose names shares have been transferred. The decision of the Tribunal in the case of Rajinidevi A. Chowdhary has also been upheld by the jurisdictional High Court as taken note of by this Tribunal in the case of Shri Pinakin L. Shah [cited supra], to which one of us i.e. the Judicial Member, is a party. In these facts and circumstances of the case, we do not see any reason to interfere with the order of the CIT[A] and the same is upheld. 14 In the result, revenue's appeal is dismissed." 7. The facts of the case in hand being identical and there being no direct or material evidence against the assessee to hold that the share transactions were not genuine, we respectfully following the above decisions of the Tribunal, hold that additions made by the AO u/s.68 are not warranted and are accordingly deleted. Since we have set-aside the findings of the lower authorities that the transactions in question were not genuine, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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