TMI Blog2020 (2) TMI 1712X X X X Extracts X X X X X X X X Extracts X X X X ..... e a subject-matter of decision in such a case. In order to find out whether the transaction is genuine or in genuine it is neither the expedience nor correctness of the decision nor the business expertise of the person to be considered. It is to be considered on the basis of the materials that there was no such transaction and that these share transactions were paper transactions. The suffering of loss could not be a factor for such purpose. Having regard to the facts and circumstances of the case, the view taken by the Tribunal allowing share loss cannot be said to be erroneous or perverse. Thus we direct the Assessing Officer to delete the addition in question - Decided in favour of assessee. - Shri S.S. Godara, Judicial Member For the Appellant : Shri S.L. Kochar, Advocate. For the Respondent : Shri Jayanta Khanra, JCIT-SR-DR. ORDER This assessee s appeal for assessment year 2010-11, arises against the Commissioner of Income-tax (Appeals)-10 Kolkata s order dated 30.10.2019 passed in case No. 831/CIT(A)-10/Cir-34/2010-11/2017-18/Kol, involving proceedings u/s. 147 r.w.s. 143(3) of the Income Tax Act, 1961; in short the Act . Heard both the parties. Cas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed loss. The AO has recorded that the appellant had failed to substantiate its bona fideness with proper evidence by producing any books of accounts that there was no such transaction through client code module. It is the case of the AO that as the transaction had been made through the PAN of the appellant, he ought to be well aware of the fact of transactions being carried out through Client Code Modification, and ought to have raised objections with the Broker against such transaction. It is the AO's case that as the appellant had failed to provide any evidence in the matter of raising any objections with the broker, as well as any certificate from the broker to the effect that there was no such transaction in the name of the appellant towards shifting out profit and loss of share business through client code module. Therefore the AO has reckoned that as it is quite evident on record that during the relevant assessment year, the appellant had shifted out profit of Rs. 19,09,281/- and therefore this amount was correctly added back to its total income. 8.1. Having examined the matter, I find that the appellant has not been able to bring anything on record to prove the rat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... held, and the ground nos. 2, 3 4 of the appellant stands dismissed . 3. Learned Counsel vehemently contends that the Id. CIT(Appeals) has erred in law as well as on facts in upholding the A.O's action in treating the assessee's above stated loss as unexplained cash credit. The Revenue, on the other hand, has chosen to place strong reliance on the Id. CIT(Appeals)'s foregoing detailed discussion. I notice in these peculiar facts and circumstances this tribunal's coordinate bench in M/s. Khaitan Trade Holdings Pvt. Limited -vs.- ITO in ITA No. 2179/Kol/2017 has adjudicated the very issue as under:- 2. The assessee is a company and is a sub-broker in shares. The Assessing Officer disallowed the claim on account of derivative transactions of Rs. 8,91,057/-. The Assessing Officer held that the assessee had entered into limited transactions and all the transaction in which the assessee entered into were transactions in which Client Code Modification (CCM), was made by the broker, through whom the transactions were affected. He held that the loss which were booked by the assessee were actually incurred by somebody else, but by changing the code subsequently, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ra 5 6, it has been held as follows:- 5. Heard rival submissions and perused the material available on record. We find that the issue in hand is squarely covered in favour of assessee by the said order dt. 16-06-17 in assessee's own case in ITA No. 191/Ko1/2015 for the A.Y 2009-10, wherein the assessee has claimed loss of Rs. 19, 76,538/-. The AO treating the same as bogus added the same to the total income of the assessee only on the ground that the broker has modified the name and code of assessee. We find that this Tribunal vide its said order dt. 16-06-17 in assessee's own case for the A. Y 2009-10 held that modifications are permitted by NSE and such modification carried out within the prescribed time limit provided by NSE. Relevant portion of finding of such order is reproduced herein below:- 7. We have heard the rival contentions of both the parties and perused and carefully considered the material on record; including the judicial pronouncements cited and placed reliance upon. The issue before us revolves for the amount of loss claimed by assessee for - 19,76,538/- which was treated by the Authorities Below as bogus mainly due to the modification carr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... th the details furnished by the NSE. In none of the case, Authorities Below have brought on record where any mismatch is found between the books of the assessee and the confirmation received from NSE. Had there been any manipulation in the impugned loss then it could have been revealed from the confirmation received from NSE. Therefore, the modifications in the client's name and code cannot justify the impugned loss as bogus. Thus, we conclude that the impugned addition has been made by the Authorities Below on the basis of surmise and conjecture which is not permissible in the eyes of law as held by the Hon'ble Supreme Court in the case of Lalchand Bhagat Ambica Ram vs. CIT Bihar and Orissa (1959) 159 ITR 289 (SC). Therefore, we hold that the impugned loss cannot be subject- matter of addition on the basis of suspicion. In this regard we also rely in the case of CIT vs. Kundan Investment Ltd. reported in 263 ITR 626 (Cal) where Hon'ble jurisdictional High Court has held:- The Tribunal had found that all relevant documents relating to contract notes, bills, the quoted price and other materials were produced The transactions were made through cheques. All the shar ..... X X X X Extracts X X X X X X X X Extracts X X X X
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