TMI Blog2023 (7) TMI 1286X X X X Extracts X X X X X X X X Extracts X X X X ..... were dematerialized and the shares have been routed from demat account and the consideration was also received through bank channels. AO does not have any independent source or evidence to show that there was an agreement between the assessee and any other party. The learned tribunal has also observed that in absence of any specific finding against the assessee, the assessee cannot be held to be linked to the wrong acts merely on the basis of surmises and assumptions. No substantial question of law. - HONOURABLE MR. JUSTICE BIREN VAISHNAV AND HONOURABLE MR. JUSTICE DEVAN M. DESAI Appearance: For the Appellant : Mr. Varun K.Patel (3802) No. 1 For the Opponent(s) No. 1 ORAL ORDER (PER : HONOURABLE MR. JUSTICE DEVAN M. DESAI) 1. The appellant has filed present Tax Appeal under Section 260A of the Income Tax Act, 1961 (hereinafter referred to as `the Act ). The same is arising out of an order dated 23.12.2022 passed by the Income Tax Appellate Tribunal (hereinafter referred to as `the Tribunal ) in ITA No. 592/Ahd/2020 for A.Y. 2012-13. 2. Heard learned counsel Mr. Varun K. Patel for the appellant. Perused the record. 3. At the outset, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he decisions rendered by the learned tribunal. 7. It is observed by the learned tribunal that the controversy arose whether the assessee genuinely purchased and sold the shares of the above referred two companies through stock exchange. The learned tribunal has further observed that the AO has simply proceeded on the basis of financials of the company in arriving at the conclusion that the transactions were accommodation entries and hence they were fictitious. However, the conclusion drawn by the AO was on the assumption that there was an agreement to convert unaccounted money by taking fictitious LTCG. On appreciation of facts, learned tribunal held that the decision of the AO was unsupported by any material on record and the finding was purely on assumption basis. 8. The learned tribunal has also observed that the respondent had successfully discharged the initial burden cast upon it under the provisions of Section 68 of the Act. It is not in dispute that the shares of the aforesaid two companies were purchased online and the payments were made through banking channel and the shares were dematerialized and the shares have been routed from demat account and the consideration ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bstantive statutory right, it has to be regulated in accordance with law in force at the relevant time. The conditions mentioned in Section 260A must be strictly fulfilled before an appeal can be maintained under Section 260A. Such appeal cannot be decided on merely equitable grounds. 15. An appeal under Section 260A can be only in respect of a 'substantial question of law'. The expression 'substantial question of law' has not been defined anywhere in the statute. But it has acquired a definite connotation through various judicial pronouncements. In Sir Chunilal V. Mehta Sons Ltd. v. Century Spinning Mfg. Co. Ltd., AIR (1962) SC 1314 , this court laid down the following tests to determine whether a substantial question of law is involved. The tests are: (1) whether directly or indirectly it affects substantial rights of the parties, or (2) the question is of general public importance, or (3) whether it is an open question in the sense that issue is not settled by pronouncement of this Court or Privy Council or by the Federal Court, or (4) the issue is not free from difficulty, and (5) it calls for a discussion for alternative ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the parties before it are concerned. To be a question of law involving in the case there must be first a foundation for it laid in the pleadings and the question should emerge from the sustainable findings of fact arrived at by court of facts and it must be necessary to decide that question of law for a just and proper decision of the case. An entirely new point raised for the first time before the High Court is not a question involved in the case unless it goes to the root of the matter. It will, therefore, depend on the facts and circumstance of each case whether a question of law is a substantial one and involved in the case, or not; the paramount overall consideration being the need for striking a judicious balance between the indispensable obligation to do justice at all stages and impelling necessity of avoiding prolongation in the life of any lis. 20. In Hero Vinoth (Minor) Vs. Seshammal (2006) 5 SCC 545, 556 , this Court has observed that: The general rule is that High Court will not interfere with the concurrent findings of the courts below. But it is not an absolute rule. Some of the well-recognised exceptions are where (i) the courts below have ignored m ..... X X X X Extracts X X X X X X X X Extracts X X X X
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