TMI Blog2023 (6) TMI 87X X X X Extracts X X X X X X X X Extracts X X X X ..... record that the assessee was involved in converting his unaccounted money into long-term capital gains and short-term capital gains by conniving with any entry operator/exit provider, who was involved in artificial price rigging of shares. This is the case wherein the AO merely on the basis of suspicion rejected the claim of the assessee, without establishing any link between the assessee with the entry operators/exit providers, who were allegedly involved in price rigging of shares artificially of the aforesaid companies. Direct the AO to delete the impugned addition made under section 68 and accept the plea of the assessee in respect of the long-term capital gains and short-term capital gains earned during the year. Decided in favou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The learned CIT(A) erred in confirming the action of the AO denying the exemption under sec. 10(38) of the Act to the appellant to the extent of Rs 1,83,03,470 when all the conditions for claiming exemption are satisfied by the appellant, and the concessional rate of tax under section to short term capital gains to the extent of Rs. 69,21,151. 5. The learned CIT(A) erred in treating the transaction of the appellant as non-genuine relying only on circumstantial evidence such as price movements of the equity share which is beyond the control of the appellant. 6. The learned CIT(A) erred in relying on certain judicial pronouncements facts of which were distinct and distinguishable, and ignoring other decisions including that of the j ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... During the assessment proceedings, the AO noted that the scrip of M/s Ashika Credit and Capital Ltd. was purchased by the assessee in the month of September 2013 and October 2013 and the same was sold in November 2013. It was further observed that the market price of the shares of M/s Ashika Credit and Capital Ltd. at around Rs.100 for the share having a face value of Re.1 in September 2013 and around Rs.140 in October 2013 rose to Rs.240 to 250 in just one or two months. Similarly, the assessee purchased the shares of M/s Parag Shilpa Investments Ltd at the rate of Rs.10 per share on 17/07/2012, which were sold in March 2014 at the average rate of Rs. 537 (approx.) per share. It was further observed that both the entities, i.e. M/s Parag S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ay of price differences in share transactions not supported by market factors. Thus, the assessee has prearranged method in connivance with the operators to evade taxes. The AO also alleged that the associated brokers, entry operators, and the assessee had worked out an arrangement in which the shares were acquired by the assessee, the share prices were rigged, and then with the help of entry operators by routing the cash, shares were sold at a high price to arrive at tax-free long term capital gains and short term capital gains at a reduced tax rate. Accordingly, the AO made the addition of the entire amount of sale proceeds of Rs.3,10,51,461 received by the assessee as unexplained taxable income and added the same under section 68 of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... capital gains and a lower rate of tax on short-term capital gains earned by the assessee. The AO also referred to the value of the shares at a different point in time including the period during which the assessee was holding the shares. However, from the perusal of the assessment order, it is evident that neither in the findings of the Investigation Wing, referred by the AO from pages 4-6 of the assessment order, nor in the statements of beneficiaries and entry providers recorded during the aforesaid investigation, as mentioned from pages 12-22 and thereafter from 24-31 of the assessment order, there is any mention of the name of the assessee. Further, the aforesaid findings also do not establish any nexus of these tainted investors, exit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... money into long-term capital gains and short-term capital gains by conniving with any entry operator/exit provider, who was involved in artificial price rigging of shares. Thus, this is the case wherein the AO merely on the basis of suspicion rejected the claim of the assessee, without establishing any link between the assessee with the entry operators/exit providers, who were allegedly involved in price rigging of shares artificially of the aforesaid companies. Therefore, in view of the above, we are unable to persuade ourselves to accept the conclusion reached by the Revenue on the basis of findings recorded in the orders passed by the lower authorities. Accordingly, we direct the AO to delete the impugned addition made under section 68 o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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