TMI Blog2021 (7) TMI 49X X X X Extracts X X X X X X X X Extracts X X X X ..... PER L.P. SAHU, A.M.: This appeal filed by the assessee is directed against CIT(A) 6, Hyderabad s order dated 16/03/2018 for AY 2014-15 involving proceedings u/s 143(3) of the Income Tax Act, 1961 ; in short the Act on the following grounds of appeal: 1. The order of the Ld. Commissioner of Income Tax General (Appeals) - 6 is erroneous both on facts and in law, to Ground the extent the order is prejudicial to the interest of the assessee. 2. The Ld. CIT (A) erred in confirming the disallowance of exemption claimed u/s 10(38) of the Act for ₹ 37,05,325 /- 3. The Ld. CIT(A) ought to have fairly appreciated that the AO erred in treating the amount of sale proceeds of shares of ₹ 37,05,325/- as unexplained cash credits u/s. 68 of income tax act,1961. 4 The Ld. CIT(A) ought to have considered the fact that the assessee has actually purchased and sold the shares accordingly, through Recognised SEBI which confirms the validity and genuineness of the transactions made by the assessee. 5 The Ld. CIT(A) ought to have appreciated that AO erred in treating the amount of ₹ 1,14,930/- as unexplained expenditure u/s 69C of Income Tax Act,1961 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es. 17. The Ld.CIT (A) ought to have followed the judgement of jurisdictional High Court in I.T.T.A. No. 490 of 2014 dated 30.07.2014 in the case of CIT-V, Hyderabad v. Smt. Aarti Mittal and ought to have held that the share transactions of the appellant are genuine. 18 The Ld. CIT (1\) erred in misappreciating the fact that the appellant has not declared any income under Income Declaration Scheme (IDS) on this scrip of Kailash Auto Finance Limited , which the AO has considered in assessment order. 19 The Ld. CIT (Al erred in not considering the fact that the SEBI later has lifted the ban on the scrip Kailash Auto Finance Ltd . It proves that the scrip is genuine. 20 The assessee may add, alter or modify any other points to the grounds of appeal at any time before or at the time of hearing of the appeal. 1.1 The sum and substance of the grounds raised by the assessee is against the disallowance of assessee s claim of exemption u/s 10(38) of the IT Act. 2. The assessee, a Hindu Undivided Family into the business of commodities trading, filed its return of income on 17/10/2016 declaring income of ₹ 36,16,340/-. Subsequently, the case was selected for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ort of purchase and sales were furnished before the revenue authorities. Further, he submitted that the SEBI has lifted the ban on the scrip M/s Kailash Auto Finance Ltd. and accordingly, he submitted that the transactions pertaining to LTCG cannot be termed as sham transaction. 6. The ld. DR, on the other hand, relied on the orders of revenue authorities. 7. We have considered the rival submissions and perused the material on record as well as gone through the orders of revenue authorities. The AO observed that the assessee has computed long term capital gains of ₹ 37,05,325/- and claimed exemption u/s 10(38) of the Act, which was earned by the assessee on sale of shares. The AO disallowed the same after examining the details. He also observed that the profitability of the company of which shares were sold are very meagre amount and the price of the shares were gone up. The issue was examined in detail by the AO and held that the assessee has routed his unaccounted money through sale of shares with high price and claimed LTGS under section 10(38) of the Act. 7.1 Similar issue came up before the coordinate bench of this Tribunal (wherein both the Members are party) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... /s Gold Line International Finvest Limited, but nothing emerged from this effort. The payment for the shares in question was made by Sh. Salasar Trading Company. Notice was issued to this entity as well, but when the notices were returned unserved, the AO did not take the matter any further. He thereafter simply proceeded on the basis of the financials of the company to come to the conclusion that the transactions were accommodation entries, and thus, fictitious. The conclusion drawn by the AO, that there was an agreement to convert unaccounted money by taking fictitious LTCG in a pre-planned manner, is therefore entirely unsupported by any material on record. This finding is thus purely an assumption based on conjecture made by the AO. This flawed approach forms the reason for the learned ITAT to interfere with the findings of the lower tax authorities. The learned ITAT after considering the entire conspectus of case and the evidence brought on record, held that the Respondent had successfully discharged the initial onus cast upon it under the provisions of Section 68 of the Act. It is recorded that There is no dispute that the shares of the two companies were purchased online, t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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