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TMI Blog2024 (5) TMI 1289X X X X Extracts X X X X X X X X Extracts X X X X ..... followed by issue of notice u/s 148 by ITO, Ward-37(3) is without jurisdiction and bad in law when the jurisdiction of the case was with the ITO, Ward-45(1), Kolkata. 2. For that on the facts and in the circumstances of the case the proceedings u/s 148 is bad in law and not maintainable. 3. For that the ld. CIT(A) erred in accepting the proceedings initiated by AO simply on the basis of some vague information received from investigating wing without any tangible material or making any independent enquiry or examination as to the authenticity thereof simply on suspicion and surmises is not maintainable. 4. For that the proceedings initiated u/s 147 in the instant case is otherwise bad in law since the copy of approval u/s 151 taken ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essee. However, assessee did not file any supporting documents / evidences such as relevant bank account statement, D-mat account statement and the ld. AO treated the entire amount of Rs. 9,16,444/- as unexplained sum u/s 68 of the Act in the hands of assessee. 3. Dissatisfied with the above order, assessee went into the appeal before the ld. CIT(A) where the appeal of the assessee was dismissed. 4. Aggrieved by the above order, assessee is in appeal before the Tribunal raising multiple grounds of appeal. However, the main grievance of the assessee is challenging the validity of assessment on the ground that reasons recorded by the AO for reopening of the assessment lacks the individual application of mind by the AO and the same were reco ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bed the actual transactions start taking place there are brokers in different town who contact prospective client sand take paper booking for entries. The commission to be paid to the operators is decided at this stage however, no money is paid. Once the booking is complete the operators have a reasonably good idea of how much LTCG is to be provided along with the break-up of individual beneficiaries. The activities were carried out for more than one year so that beneficiary can claim the loop holes of the Income tax Act by claiming exemption of section 10(38) of the Act. As per this section, if any individual/HUF holds any share for more than one year, then the gain team the said transactions on shares is allowed as exempt income. On pe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... its purchase. As a consequence, the assessee claimed this income as exempted tactfully by utilizing the loop holes of section 10(38) of the Income Tax Act. On examination of detailed report, it is found that these transactions was dubious in nature and everything was done in connivance of entry operator, broker and other middleman beginning from purchase to sale and also financial transaction among them. The scripts of the shares are seldom traded and it is under the control certain person/ group of persons. Until and unless there is understanding between the parties, it was not possible to acquire those shares by the assessee. Therefore, everything was an arrangement by controller/entry operator/broker to make the transaction a legal c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... company by providing its dummy directors, there is no way but only to consider that the assessee willfully evade tax by furnishing inaccurate particulars of income/details it should offer the income as earned from selling of shares. The entire amount of receipt towards alleged sale of the scrips of NYSSA CORPORATION LTD. through exchange in connivance with the entry operators & others associated are actually the income of the assessee. Therefore, I have reasons to believe that for the A.Y. 2015-16, income chargeable to tax to the tune of Rs. 9,16,444/- has escaped assessment. Hence, the provision of section 147 of the Income Tax Act, 1961 is attracted to this case. In this case no assessment was made u/s 143(3)/147 of the Act. Only p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessee under the provisions of section 147 of the Act making an addition of Rs. 9,16,444/- in the hands of assessee which is not sustainable according to ld. AR. We find merit in the contentions of the ld. AR that the AO has recorded the reasons based on the borrowed satisfaction without application of mind and without carrying out any enquiry into case. We also note that assessee filed Schedule-EI which contained the details of exempt income earned during the year by the assessee disclosing sum of Rs. 63,938/- as long term capital gain from the transaction. Thus the AO noting in the reasons that the assessee has not disclosed the capital gain in the return of income is also not correct by making an addition of Rs. 9,16,444/- in the hands ..... X X X X Extracts X X X X X X X X Extracts X X X X
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