TMI Blog2022 (5) TMI 226X X X X Extracts X X X X X X X X Extracts X X X X ..... R.K. PANDA, AM, This appeal filed by the assessee is directed against the order dated 04.01.2019 of the Ld. CIT(A)-16, New Delhi, relating to Assessment Year 2015-16. 2. Although a number of ground have been raised by the assessee however, these all relate to the order of the Ld. CIT(A) in confirming the addition of Rs.18,81,961/- made by the AO by disallowing the claim u/s 10(38) of the Act and confirming the addition Rs.94,099/- made by the AO u/s 69C of the Act being unexplained expenditure for obtaining the accommodation entry. 3. Facts of the case, in brief, are that the assessee is an individual and derives income from house property and income from other sources. She filed her return of income on 25.08.2015 declaring total income of Rs.6,09,460/-. The case was selected for scrutiny and statutory notices u/s143(2)/142(1) were issued and served on the assessee along with questionnaire. 4. During the course of assessment proceedings, the AO noted that the assessee has claimed exempt income u/s 10(38) of the Act amounting to Rs.18,81,961/- earned from sale of 50000 shares of M/s Kailash Auto Finance Limited. From the various details furnished by the assesse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cated device to launder assessee s black money. Rejecting the various explanation given by the assessee and relying on various decisions, the AO treated the LTCG as an unexplained credit entry in the hands of the assessee and made an addition of this amount after invoking provisions of section 68 of the Act. Similarly, the AO made addition ofRs.94,099/- being the commission @5% of such accommodation entries paid to the broker by invoking the provisions of section 69C of the Act. The AO accordingly determined the total income of the assessee at Rs.25,85,520/- as against the returned income of Rs.6,09,460/-. 6. In appeal, the ld. CIT(A) upheld the action of the AO. 7. Aggrieved with such order of the Ld. CIT(A), the assessee is in appeal before the Tribunal. 8. The ld. counsel for the assessee strongly challenged the order the ld. CIT(A) in sustaining the addition made by the AO. He submitted that the assessee is a regular investor and trader in the capital market in blue chip companies, midcap and small cap which is verifiable from the statement of holding in past as well as in subsequent years. He submitted that the assessee has purchased 100000 shares on 10.09.2012 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ons 6087/2018, order dated 21.01.2019 viii. Navneet Agarwal ITA No.2281/2017, order dated 20.07.2018 9. The ld. DR on the other hand, heavily relied on the order of the AO and the Ld. CIT(A). 10. I have considered the rival arguments made by both the sides, perused the orders of the Assessing Officer and the Ld. CIT(A) and the paper book filed on behalf of the assessee. I have also considered the various decisions cited before me. I find the assessee in the instant case claimed Long Term Capital Gain of Rs.18,81,961/- as exempt income u/s 10(38) of the Act being sale of 50000 shares of M/s Kailash Auto Finance Limited. I find the AO rejected the deduction claimed u/s 10(38) of the Act on the ground that the assessee has earned a return of approximately 3763% over a very short period of just over 15 months and the financial results of M/s Kailash Auto Finance Limited are not very good. While doing so, the AO examined the modus operandi of the transaction, analysed the price/volume movement of the scrip and acquisition of promoter share of both PML, CAPAL and KAFL and examined the order of SEBI wherein SEBI has held that M/s Kailash Auto Finance Ltd. was guilty of pric ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... odation entry in any inquiry by the Investigation Wing or any such material has been unearthed by the department. The assessee had duly shown the transaction in cheques right from purchase to sale of shares and all the transaction has been have been routed through DMAT account sold in the Bombay Stock Exchange as per quoted price as on that date. Before us it has also been brought on record that SEBI vide its order dated 21st September 2017 has revoked the ban on Kailash Auto Finance Ltd. Para 5 of the said order reads as under :- Pursuant to the interim order, SEBI conducted a detailed investigation into the role of various entities in price manipulation in the scrip of Kailash Auto so as to ascertain the violation of securities laws. Upon completion of investigation by SEBI, investigation did not find any adverse evidence/adverse findings in respect of violation of provisions of the PFUTP Regulations in respect of the following 244 entities (against whom directions were issued vide the interim order and / or confirmatory orders) warranting continuation of action under section 11B/r/w11 (4) of the Act. The details of the 244 entities are as follows. And vide para 8 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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