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TMI Blog2024 (9) TMI 1517X X X X Extracts X X X X X X X X Extracts X X X X ..... tablished law that no addition can be made solely on the basis of statements recorded on oath during the course of survey conducted just on the basis of information received from Investigation Wing of Income Tax, Kolkata, without making its own independent enquiry and efforts. Thus, the additions made solely on the basis of such retracted statements deserve to be deleted. 1.1 That, the Ld. CIT (A) NFAC has grossly erred in confirming the addition made in the assessment completed u/s 143(3) solely on the basis of statements of Shri Anil Agarwal recorded by I.T. Officials after giving summons u/s 131 of the I.T. Act 1961 during the course of search operations carried out on the entry providers and survey conducted on the broking houses in Kolkata, by the Income Tax Officials. And also no opportunity of cross examining Shri Anil Agarwal was provided. Thus, the assessment order deserves to be held bad in law and the additions made there under deserve to be deleted. 2. On the facts and in the circumstances of the case the Ld. CIT(A) NFAC has grossly erred in confirming the disallowance of claim of long term capital gain claimed exempt u/s 10(38) amounting to Rs. 2147685/-, as unexpl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not bring any distinguishing decision in favour of the revenue. 6. We have given a thoughtful consideration to the orders of the authorities below. We find force in the contention of the counsel on identical set of facts and on identical transactions in identical scrip the coordinate bench had considered the identical issue in the case Sanket Shailendra Modi in ITA No. 1780/Mum/2022. The relevant finding reads as under:- "6. At the outset, we find that the documentary evidences submitted by the assessee were found to be genuine and no adverse inferences were drawn by the revenue on the same. The transactions were carried out by the assessee in the secondary market through a registered share broker at the prevailing market prices. Payments were received by the assessee by account payee cheques from the stock exchange through the registered broker. Amounts received on sale of shares were duly subjected to levy of Securities Transaction Tax (STT) at the applicable rates. 6.1. We find that no enquiries were carried out by the revenue either on the broker or with the stock exchange with regard to transactions carried out by the assessee. The revenue had merely relied on the Kolkat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... general in nature and does not implicate the assessee herein in any manner whatsoever. We are unable to persuade ourselves to accept to the contentions of the Id. DR that Kolkata Investigation Wing had conducted a detailed enquiry with regard to the scrip dealt by the assessee herein and hence whomsoever had dealt in this scrip, would only result in bogus claim of long term capital gain exemption or bogus claim of short term capital loss. Merely because a particular scrip is identified as a penny stock by the income tax department, it does not mean all the transactions carried out in that scrip would be bogus. So many investors enter the capital market just to make it a chance by investing their surplus monies. They also end up with making investment in certain scrips (read penny stocks) based on market information and try to exit at an appropriate time the moment they make their profits. In this process, they also burn their fingers by incurring huge losses without knowing the fact that the particular scrip invested is operated by certain interested parties with an ulterior motive and once their motives are achieved, the price falls like pack of cards and eventually make the gulli ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... are allowed." 7. While coming to the above conclusion the coordinate bench has considered the following facts :- Date Event Supporting documents Submitted before AO during assessment proceeding 18.03.2011 Appellant purchased shares of sunrise Asian Ltd from Shipra Fabrics Private Ltd being an off market purchase in physical form Debit note issued by Shipra Fabrics P Ltd dated 18th March 2011 Yes on 9th October 2017 18.03.2011 Cheque No 689555 drawn on HDFC Bank Favoring Shipra Fabrics Ltd. cleared by bankers on 19.03.2011 Copy of bank statement for the relevant transactions Yes on 9th October 2017 19.03.2011 Receipt issued by Shipra C Fabrics Ltd. for consideration of 100000/- Copy of receipt Yes on 9th October 2017 11.09.2012 Physical Shares Credited to Demat Account of Appellant with HDFC Bank Copy of Demat statement for the period 01.04.2012 to 31.03.2013 Yes on 9th October 2017 13.05.2013 to 16.05.2013 Sale of 5000 shares of Sunrise Asian Ltd on BSE platform through Fortune Copies of contract notes for sale of 5000 shares issued by Fortune Equity Brokers(India) Ltd. Yes on 9th October 2017 06.06.2013 Transfer of share of Sunrise Asian from HDFC demat ..... X X X X Extracts X X X X X X X X Extracts X X X X
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