Appeal details
Counselvise Citation
[2019] 116 COUNSELVISE.COM (IT) 8293 (ITAT-KOLKATA)
Assessee PAN
Bench
Appeal Number
Duration Of Justice
11 month(s) 22 day(s)
Appellant
Respondent
Appeal Type
Income Tax Appeal
Pronouncement Date
28-06-2019
Appeal Filed By
Assessee
Order Result
Allowed
Bench Allotted
SMC
Next Hearing Date
26-06-2019
Assessment Year
2014-2015
Appeal Filed On
06-07-2018
Judgement Text
IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA BENCH SMC KOLKATA BEFORE SHRI S.S, GODARA, JUDICIAL MEMBER ITA NO.1445/KOL/2018 ASSESSMENT YEAR:2014-15 SRI VIKASH AJHAWAR 142 OLD CHINA BAZAR STREET, 3 RD FLOOR, BHIKAMCHAND MARKET, KOLKATA-700001 [ PAN NO.AEWPJ 9016 R ] / V/S . ITO WARD-36(4), 110, SHANTIPALLY, NR. RUBY HOSPITAL, E.M.BYEPASS, KOLKATA-107 /APPELLANT .. /RESPONDENT /BY APPELLANT SHRI SUNIL SURANA, FCA /BY RESPONDENT SHRI SANKAR HALDER, JCIT-SR-DR /DATE OF HEARING 26-06-2019 ITA NO.2156/KOL/2018 ASSESSMENT YEAR:2015-16 MAAN VARDHAN BAID HUF 313, TODI CHAMBERS, 2, LAL BAZAR STREET, KOLKATA-700001 [ PAN NO.AEWPJ 9016 R ] / V/S . ITO WARD-35(4), 110, SHANTIPALLY, 8 TH FLOOR, NR. RUBY HOSPITAL, E.M.BYEPASS, KOLKATA- 107 /APPELLANT .. /RESPONDENT /BY APPELLANT SHRI YASH VARDHAN BAID, ADVOCATE /BY RESPONDENT SHRI SANKAR HALDER, JCIT-SR-DR /DATE OF HEARING 26-06-2019 PAGE 2 ITA NO.2526/KOL/2018 ASSESSMENT YEAR:2014-15 ANAND KEDIA 29, R.N.MUKHERJEE ROAD, WINDSOR HOUSE, 2 ND FLOOR, R.NO. 15, KOLKATA-700001 [ PAN NO.AFQPK 8411 C ] / V/S . ITO WARD-22(4), 54/1, RAFI AHMED KIDWAI ROAD, 3 RD FLOOR, KOLKATA-700 016 /APPELLANT .. /RESPONDENT /BY APPELLANT ANAND KEDIA STAFF & SHRI MANISH TIWARI, FCA /BY RESPONDENT SHRI SANKAR HALDER, JCIT-SR-DR /DATE OF HEARING 26-06-2019 ITA NO.121/KOL/2019 ASSESSMENT YEAR:2014-15 M/S DEWDROP SECURITIES PVT. LTD., GD-278, SECTOR-III, SALT LAKE CITY, KOLKATA-700106 [ PAN NO.AACCD 9523 C ] / V/S . ITO WARD-6(4), 169, AJC BOSE, ROAD, 9THFLOOR, KOLKATA /APPELLANT .. /RESPONDENT ITA NO.2572/KOL/2018 ASSESSMENT YEAR:2014-15 PRACHI PODDAR 42C, BALLYGUNGE CIRCULAR ROAD, BALLYGUNGE, KOLKATA [ PAN NO.AKUPS 6109 A ] / V/S . ITO WARD-62(2) 169, AJC BOSE ROAD, 9 TH FLOOR, KOLKATA /APPELLANT .. /RESPONDENT /BY ASSESSEE SHRI DILIP KUMAR PATNI, CA /BY REVENUE SHRI SANKAR HALDER, JCIT-SR-DR /DATE OF HEARING 26-06-2019 PAGE 3 ITA NO.93/KOL/2019 ASSESSMENT YEAR:2014-15 SONA KUMAR SHOW C/O S.N.GHOSH & ASSOCIATES, ADVOCATES SEVEN BROTHERSLODGE P.O. BUROSHIBTALA, P.S. CHINSURAH, DIST. HOOGHLY- 712105 [ PAN NO.AKAPS 5712 R ] / V/S . ACIT, WARD-23(1), AAYKAR BHAWAN, G.T. ROAD, KHADINA MORE, P.O.&P.S. CHINSURAH, DIST.HOOGHLY-712101 /APPELLANT .. /RESPONDENT /BY APPELLANT SHRI SOMNATH GHOSH, ADVOCATE /BY RESPONDENT SHRI SANKAR HALDER, JCIT-SR-DR /DATE OF HEARING 26-06-2019 ITA NO.1653/KOL/2018 ASSESSMENT YEAR:2014-15 MANISHA MADHOGARIA C/O S.L.KOCHAR, ADVOCATE, 5, ASHUTOSH CHOWDHURY AVENUE, KOLKATA-700019 [ PAN NO.AFNPM 4613 D ] / V/S . ITO WARD-47(4), 3, GOVT. PLACE (WEST), KOLKATA-700 001 /APPELLANT .. /RESPONDENT /BY APPELLANT SHRI ARYAN KOCHAR, ADVOCATE & SHRI ANIL KOCHAR, ADVOCATE /BY RESPONDENT SHRI SANKAR HALDER, JCIT-SR-DR /DATE OF HEARING 26-06-2019 ITA NO.1049/KOL/2018 ASSESSMENT YEAR:2014-15 SHRI SUSHIL KUMAR BARDIA 20, N.S.ROAD, KOLKATA- 700001 / V/S . INCOME TAX OFFICER WARD-36(2), 9 TH FLOOR, AAYKAR BHAVAN POORVA, PAGE 4 [ PAN NO.ADXPB 9014 D ] 110, SHANTI PALLY, KOLKATA-107 /APPELLANT .. /RESPONDENT /BY APPELLANT SHRI ANIL KOCHAR, ADVOCATE /BY RESPONDENT SHRI SANKAR HALDER, JCIT-SR-DR /DATE OF HEARING 26-06-2019 ITA NO.1670/KOL/2018 ASSESSMENT YEAR:2014-15 RAMAKANT BERIWALA 5, CLIVE ROW, ROOM NO.23, KOLKATA-700001 [ PAN NO.ADWPB 8576 F ] / V/S . INCOME TAX OFFICER WARD-36(1), AAYKAR BHAWAN POORVA, 110, SHANTIPALLY, KOLKATA- 107 /APPELLANT .. /RESPONDENT ITA NO.1983 & 1987/KOL/2018 ASSESSMENT YEAR:2014-15 NAND KISHORE AGARWALA 25, SABJI BAGAN LANE, CHETLA, KOLKATA-700027 [ PAN NO.ADDPA 1800 A ] NAND KISHORE AGARWALA L/H OF GITA DEVI AGARWALA (DECEASED) 25, SABJI BAGAN LANE, CHETLA, KOLKATA-700027 [ PAN NO.ADDPA 0573 C ] / V/S . INCOME TAX OFFICER WARD-35(2), AAYKAR BHAWAN POORVA, 110, SHANTIPALLY, KOLKATA- 107 /APPELLANT .. /RESPONDENT /BY APPELLANT SHRI MANISH TIWARI, FCA /BY RESPONDENT SHRI SANKAR HALDER, JCIT-SR-DR /DATE OF HEARING 26-06-2019 PAGE 5 ITA NO.255 & 259/KOL/2019 ASSESSMENT YEARS:2014-15 & 2015-16 MANJU CHOWDHARY PHASE-5, BLOCK-9, VIVEK VIHAR, 493/C/A,GT ROAD, HOWRAH-711102 [ PAN NO.AFBPC 5564 P ] M/S DEVI PRASAD CHOWDHARY, HUF, PHASE-5, BLOCK-9, VIVEK VIHAR, 493/C/A G.T. ROAD, HOWRAH-711102 [ PAN NO.AAFHD 2624 G ] / V/S . INCOME TAX OFFICER WARD-46(3), 3,GOVT. PLACE (WEST), 2 ND FLOOR, KOLKATA-700001 /APPELLANT .. /RESPONDENT ITA NO.257 & 258/KOL/2019 ASSESSMENT YEAR:2014-15 SNEHA GOENKA FLAT NO.5A, PHASE-5, BLOCK, 9, VIVEK VIHAR, 493/C/A, G.T. ROAD, HOWRAH-711102 [ PAN NO.BDHPG 2498 F ] RAHUL GOENKA FLAT NO.5A, PHASE-5, BLOCK, 9, VIVEK VIHAR, 493/C/A, G.T. ROAD, HOWRAH-711102 [ PAN NO.BBUPG 6761 J ] / V/S . INCOME TAX OFFICER WARD-47(1),3, GOVT. PLACE (WET), 1 ST FLOOR, KOLKATA-700001 /APPELLANT .. /RESPONDENT ITA NO.2435/KOL/2018 ASSESSMENT YEAR:2014-15 MAHABIR PRASAD BANKA 107C, TODI CHAMBERS, 2, LAL BAZAR STREET, KOLKATA [ PAN NO.AHZPB 9957 H ] / V/S . INCOME TAX OFFICER WARD-35(4), AAYKAR BHAWAN POORVA, 110, SHANTIPALLY, KOLKATA- PAGE 6 107 /APPELLANT .. /RESPONDENT ITA NO.2441/KOL/2018 ASSESSMENT YEAR:2015-16 B.N.AGARWAL & SONS (HUF) BALAJI APARTMENTS, 52/1, HAZRA ROAD, KOLKATA-700019 [ PAN NO.AAEHB 3909 D ] / V/S . ACIT, CIRCLE-46, 3, GOVT. PLACE (WEST), KOLKATA-700 001 /APPELLANT .. /RESPONDENT /BY ASSESSEE SHRI SUBASH AGARWAL, ADVOCATE /BY REVENUE SHRI SANKAR HALDER, JCIT-SR-DR /DATE OF HEARING 26-06-2019 /DATE OF PRONOUNCEMENT 28-06-2019 /O R D E R THESE ASSESSEES HAVE FILED THEIR INSTANT APPEALS INVOLVING DIFFERENT ASSESSMENT YEAR(S) AGAINST THE RESPECTIVE COMMISSIONER OF INCO ME-TAX (APPEALS) SEPARATE ORDER(S) AFFIRMING THE ASSESSING OFFICER(S) IDENTIC AL ACTION TREATING VARYING SUMS OF LONG TERM CAPITAL GAINS (LTCG) / LONG/SHORT TERM CA PITAL LOSS (LTCL); AS THE CASE MAY BE AS INVOLVING UNEXPLAINED CASH CREDITS U /S 68, INVOLVING PROCEEDINGS U/S 143(3) OF THE INCOME TAX ACT, 1961; IN SHORT THE A CT. 2. I HAVE HEARD THESE APPEAL(S) TOGETHER OF THE FAC T THAT THE SOLE IDENTICAL ISSUE RAISED IN THE INSTANT ENTIRE BATCH IS THAT OF GENUI NENESS OF ASSESSEES LTCG/LTCL, AS THE CASE MAY BE, DERIVED FROM SALE OF SHARES HELD I N VARIOUS SCRIPS. IT IS IN THIS IDENTICAL BACKDROP THAT I AM TREATING ITA NO.258KOL/2019 IN CASE OF RAHUL GOENKA VS. ITO WD-47(1), KOLKATA FOR ASSESSMENT YEAR 2014-15 AS THE LEAD CASE. PAGE 7 3. BOTH THE LEARNED REPRESENTATIVE(S) TAKE ME TO CI T(A)S DETAILED DISCUSSION WHILST TREATING THE IMPUGNED STCL PRE-ARRANGED BOGU S LOSS IN THE INSTANT LEAD CASE VIDE THE FOLLOWING LOWER APPELLATE DISCUSSION:- I HAVE CONSIDERED THE SUBMISSION OF THE APPELLANT A ND PERUSED THE ASSESSMENT RECORDS. THE AO. IN HIS ASSESSMENT ORDER HAD HELD THAT LONG TERM CAPITAL GAINS OF RS.650475/- WHICH HAD BEEN REFLECTED THE APPELLANT IN THE RETURNS ON WHICH HE HAD CLAIMED EXEMPTION U/S.10(38) OF IT ACT, 1961 WAS BOGUS AND WERE ADDED BACK AS UN EXPLAINED CASH CREDIT U/S. 68 OF THE ACT. IN THIS REGARD THE AIR OF THE APPELLANT COMPANY WAS ISSUED A DETAILED SHOW CAUSE LETTER ASKING TO EXPLAIN AS TO WHY THE CLAIM OF LTCG IN TH E ABOVE REPORTED SCRIPTS I.E LUMINAIRE TECHNOLOGIES LTD AND UNNO INDUSTRIES LTD. SHOULD NO T BE DISALLOWED AND ADDED TO THE TOTAL INCOME. THE APPELLANT IN HIS REPLY HAS SUBMITTED TH AT HE HAD PURCHASED SHARES THROUGH A STOCK BROKER R NAMED DIMENSION SECURITIES PVT. LTD. HE FURTHER SUBMITTED THAT ALL THE TRANSACTIONS WERE CARRIED OUT ELECTRONICALLY ON THE PORTAL OF THE RECOGNISED STOCK EXCHANGE THROUGH REGISTERED BROKER AT THE PREVAILING MARKET PRICES AND THE SAME SUPPORTED BY TIME STAMPED CONTRACT NOTES. THE DELIVERIES WERE RECEIVE D AND GIVEN THROUGH DEPOSITORY ACCOUNT AND THE PAYMENTS WERE MADE THROUGH BANKING CHANNELS . ALL THE TRANSACTIONS ARE DULY SUPPORTED BY CREDIBLE EVIDENCES IN NO DEFECT HAS BE EN FOUND IN SUCH DOCUMENTS. THE SUBMISSION MADE BY THE APPELLANT WAS CONSIDERED . THE ASSESSMENT ORDER OF THE A.O. WAS BASED ON THE REPORT OF THE DIT (INV.). THE INVESTIG ATION WING OF THE DEPARTMENT HAD COME OUT WITH A COMPREHENSIVE REPORT ON THE RACKET OF PROVID ING ACCOMMODATION ENTRIES IN THE FORM OF LONG TERM CAPITAL GAINS/ LOSSES BY CERTAIN UNSCRUPU LOUS ELEMENTS WHO HAD RIGGED THE SHARE PRICE OF CERTAIN SCRIPTS. THE REPORT POINTED OUT TO THE SUSPICIOUS TRANSACTIONS IN THE SCRIPTS OF CERTAIN COMPANIES WITH A OBJECTIVE OF TAX AVOIDANCE . THE INVESTIGATION WING IDENTIFIED A TOTAL OF 84 LISTED COMPANIES, 5000 PAPER COMPANIES AND 25 ENTRY OPERATORS INVOLVED IN THIS RACKET. THE STATEMENTS OF THE OPERATORS WERE RECORDED IN WH ICH THEY ACCEPTED OF THE RIGGING THE PRICE OF THE SHARES AND MANAGING THE MARKET TO BRING DESI RABLE RESULTS WHICH SUITED THEIR CLIENTS. THESE OPERATORS ALSO ACCEPTED THAT THEY WERE DOING THIS ONLY FOR A PALTRY COMMISSION OF 50 PAISA TO 1 RUPEES PER RS.I00 THE A/R OF THE APPELLANT IN HIS SUBMISSION HAD PLAC E RELIANCE ON THE FACT THAT ALL THE TRANSACTIONS WERE CARRIED OUT ELECTRONICALLY ON THE PORTAL OF THE RECOGNISED STOCK EXCHANGE THROUGH REGISTERED BROKER AT THE PREVAILING MARKET PRICES AND THE SAME SUPPORTED BY TIME STAMPED CONTRACT NOTES. THE DELIVERIES WERE RECEIVE D AND GIVEN THROUGH DEPOSITORY ACCOUNT AND THE PAYMENTS WERE MADE THROUGH BANKING CHANNELS . ALL THE TRANSACTIONS ARE DULY SUPPORTED BY CREDIBLE EVIDENCES IN NO DEFECT HAS BE EN FOUND IN SUCH DOCUMENTS THE FACTS THAT ALL TRANSACTIONS WERE CARRIED OUT THROUGH PORTAL O F RECOGNIZED STOCK EXCHANGE AND PAYMENTS MADE THROUGH BANKING CHANNELS DOES NOT INDICATE GEN UINENESS AND ONLY REFLECTS PROPER PAPER WORK OR DOCUMENTS. WHAT IS IMPORTANCE IS WHETHER TH E FLUCTUATION OF PRICE OF THE COMPANIES ARE SUPPORTED BY THE PERFORMANCE AND FINANCIAL FUND AMENTALS. IT APPEARS THAT MOST OF THESE COMPANIES HAVE HARDLY ANY BUSINESS ACTIVITIES. ON P ERUSAL OF THE SHARE PRICE OF THESE COMPANIES OVER A PERIOD OF 5 YEARS, IT IS REVEALED THAT THE GRAPH ASSUMES THE SHAPE OF BELLS INDICATING RAPID RISE AND FALL IN THE SHARES OF BOT H THE COMPANIES M/S UNNO INDUSTRIES AND M/S LUMITECH. THE SHARE PRICE OF BOTH COMPANIES WER E EXAMINED AND IT IS REVEALED THAT THE SHARE PRICE HAD DECLINED RAPIDLY AFTER REACHING A P EAK FOR A SHORT PERIOD. THE SHARE PRICES OF THE BOTH COMPANIES ARE ANALYISED AS FOLLOWS : THERE IS EVIDENCE THAT THE SHARE PRICE OF M/S UNNO INDUSTRIES LTD WERE RIGGED ARTIFICIALLY. THIS IS SUPPORTED, ON VERIFICATION BY THE PRICE FLUCTUATION OF THE SHARES OF M/S UNNO INDUSTRIES LTD FOR THE PERIOD FROM F.Y. 20 11-12 TO 2016-17, THE TRENDS OF WHICH ARE AS FOLLOWS:- PAGE 8 06.04.2011 0.96 25.01.2012 3.01 08.04.2013 28.30 20.09.2013 37.25 19.09.2014 21.30 29.02.2016 0.49 ON EXAMINATION OF THE SHARE PRICE OF M/S UNNO INDUS TRIES LTD, IT IS OBSERVED THAT FROM A MEASLY AMOUNT OF RS.0.96 ON 06.04.2011, THE SHARE P RICE REACHED A HIGH OF RS.37.25 ON 20.09.2013. THE APPELLANT HAD SOLD HIS SHARES IN A. Y. 2014-15. IT WAS IN THAT F.Y. THAT THE SHARES OF THE COMPANY REACHED AND ALL TIME HIGH. SU BSEQUENTLY THE NEXT A.Y. THE SHARE PRICE STARTED TO FALL RAPIDLY AND IS PRESENTLY TRADING AT LESS THAN 0.50 PER SHARE. THE VOLATILITY IN THE SHARE PRICE GIVES CREDENCE TO THE ALLEGATION THAT T HE SHARES OF M/S UNNO INDUSTRIES LTD WERE RIGGED DURING THE ASSESSMENT YEAR 2014-15. IN THE S UBSEQUENT FINANCIAL YEARS, THE VALUE OF SHARES OF THE COMPANY HAD WITNESSED A DOWNWARD SPIR AL. SECONDLY THE SHARE PRICES OF M/S UNNO INDUSTRIES LTD, ARE NOT IN SYMMETRY WITH THE M ARKETS. IT IS A COMMON KNOWLEDGE, THAT WHEN STOCKS ARE HEADED INTO A BULL MARKET CYCLE, TH E TREND CAN BE DETECTED BY A PRICE RISE, BUT WHEN STOCKS ARE HEADED INTO A BEAR CYCLE, THE TREND CAN BE DETECTED BY FALLING PRICES. THE SHARES OF M/S UNNO INDUSTRIES LTD, MYSTERIOUSLY FOL LOWED A REVERSE TREND FROM THE MARKETS. IN THE PERIOD 2016 TO 2018 WHEN THE SENSEX WITNESSED A HISTORIC HIGH, THE SHARES OF THE COMPANY WERE AT AN ALL TIME LOW. THE ABOVE FINDINGS, FORTIF IES THE FINDINGS OF THE INVESTIGATION WING AND THE AO, THAT THE TRANSACTIONS IN SHARES WERE BO GUS AND THE SHARE PRICES WERE RIGGED. THIS VOLATILITY IN THE SHARE PRICE OF THE M/S UNNO INDUSTRIES LTD ALSO CAME TO THE ATTENTION OF SEBI. BASED ON THE REPORT OF SEBBI, THE BOMBAY STOC K EXCHANGE HAD SUSPENDED TRADING IN SHARES OF M/S UNNO INDUSTRIES LTD FOR A CERTAIN PER IOD. THE NOTIFICATION FROM SEBI IS REPRODUCED AS UNDER:- HOME MARKET MARKET INFO NOTICES & CIRCULARS NOTICE S GO BACK NOTICE NO.20160504- 17 NOTICE DATE 04 MAY 2016 CATEGORY COMPANY RELATED SEGMENT EQUITY SUBJECT SUSPENSION OF TRADING IN SECURITIES OF COMPANIES FO R NON-COMPLIANCE WITH REGULATION 333 OF SEBI LISTING REGULATIONS, 2015, CONTENT PURSUANT TO THE PROVISIONS OF CIRCULAR NO. CIR/CFD/CMD/12/2015 DATED NOVEMBER 30, 2015 ISSUED BY SECURITIES AND EXCHANGE BOARD OF INDIA (SEBI) WITH RESPECT TO STANDARD OPER ATING PROCEDURE (SOP) FOR SUSPENSION AND REVOCATION OF EQUITY SHARES OF LISTE D ENTITIES FOR NON-COMPLIANCE WITH PROVISIONS OF SEBI LISTING REGULATIONS, 2015, TRADI NG MEMBERS ARE REQUESTED TO NOTE THAT THE FOLLOWING WILL BE EFFECTED; (1) TRADING IN SECURITIES OF THE UNDERMENTIONED COMPANI ES WILL BE SUSPENDED W.E.F. MAY 26,2016 (BEING 21 DAYS FROM ISSUE OF THIS NOTICE); ON ACCOUNT OF NON-COMPLIANCE WITH REGULATION 33 OF SEBI LISTING REGULATIONS; 2015 FOR TWO CONSECUTIVE QUARTERS I.E., SEPTEMBER 2015 AND DECEMBER 2015 (2) SR.NO. SCRIP CODE COMPANY NAME 1 517496 RICOH INDIA LTD. 2 519273 UNNO INDUSTRIES LTD.* 3 513937 BECKONS INDUSTRIES LTD. 4 590063 DUNCANS INDUSTRIES LTD. 'THIS COMPANY IS PRESENTLY SUSPENDED DUE TO SURVEIL LANCERLZEASURESWEF MARCH, 31,2016 VIDE PROVISIONS OF. EXCHANGE NOTICE: 110. 2016032-8'-15 DATED MARCH, 28,2016. PAGE 9 THE FOLLOWING COMPANY HAS SUBMITTED- FINANCIAL RESU LTS-UNDER REGULATION 33 OF SEBI LISTING REGULATIONS, 2015 FOR TWO CONSECUTIVE QUARTERS I.E, SEPTEMBER 2015 AND DECEMBER 2015, HOWEVER, IT HAS NOT PAID THE APPLICABLE FINES, HENC E AS PER THE PROVISIONS OF CIRCULAR NO.CIR/CFD/CMD/12/2015 DATED NOVEMBER 30, 2015 ISS UED BY SECURITIES AND EXCHANGE BOARD OF INDIA (SEBI), THIS COMPANY WOULD BE SUSPEN DED W.E.F. MAY 26, 2016 (BEING 21 DAYS FROM ISSUE OF THE NOTICES .. SR.NO. SCRIP CODE COMPANY NAME 1 539274 BOSTON LEASING AND FINANCE LTD 2) FREEZING OF THE ENTIRE PROMOTER SHAREHOLDING OF THE AFORESAID COMPANIES WEF MAY 4, 2016 TILL FURTHER NOTICE. TRADING MEMBERS MAY FURTHER NO TE THAT: A) IN CASE, ANY OF THE AFORESAID COMPANIES COMPLY ( TO THE SATISFACTION OF THE EXCHANGE) WITH ALL THE PROVISIONS OF SEBI LISTING R EGULATIONS, 2015 INCLUDING PAYMENT OF FINES ON OR BEFORE MAY 20,2016; TRADING IN SECURITIES OF THE SAID COMPANIES WILL NOT BE SUSPENDED B) HOWEVER, IN CASE THE AFORESAID COMPANIES FAIL TO COMPLY WITH THE PROVISIONS OF SEBBI LISTING REGULATIONS, 2015, TO THE SATISFACTIO N OF THE EXCHANGE ON OR BEFORE MAY 20, 2016; THEN:- TRADING IN THE SECURITIES OF THE COMPANIES WOULD BE SUSPENDED WE! MAY 26, 2016, AND THE SUSPENSION WILL CONTINUE TILL SUCH TIME THE COMPANY COMPLIES INCLUDING PAYMENT OF FINES, 15 DAYS AFTER SUSPENSION HAS BEEN EFFECTED, TRADING I N THE SHARES OF NON-COMPLIANT COMPANIES WOULD BE ALLOWED ON TRADE FOR TRADE BASIS IN Z GRO UP ONLY ON THE FIRST TRADING DAY OF EVERY WEEK FOR SIX MONTHS/. REVOCATION OF SUSPENSION WOUL D BE SUBJECT TO THE COMPANIES FURTHER COMPLYING WITH THE PROCEDURE AND ALL EXTANT NORMS P RESCRIBED FOR REVOCATION OF SUSPENSION. THE BSE NOTIFICATION SPECIALLY MENTIONS THAT TRADIN G IN SHARES OF M/S UNNO INDUSTRIES LTD IS PRESENTLY SUSPENDED DUE TO SURVEILLANCE MEASURES WE T MARCH 31, 2016 VIDE PROVISIONS OF EXCHANGE NOTICE NO, 20160328-15 DATED MARCH 28,2016 . THE SEBI CIRCULAR AND BSE NOTIFICATION HAVE RAISED DOUBTS ON THE GENUINENESS OF THE SHARE PRICE OF M/S UNNO INDUSTRIES LTD. THE ANALYSIS OF THE SHARE PRICE OF M/S LUMINAIRE TE CHNOLOGIES REVEALED SIMILAR TREND AS FOLLOWS: MARCH-10 5.20 5.20 NOV-11 15.65 JULY-12 39.80 APRIL-13 53.85 DEC-13 46.50 JUNE-14 26.35 NOV-14 1.40 AUAG-16 0.20 THE SHARP FLUCTUATION IN PRICE OF THE SHARES OF M/S LUMINAIRE TECHNOLOGIES LTD FOR THE PERIOD FROM F.Y. 2009-10 TO 2016-17, RAISES THE SUSPICION THAT THE SHARE PRICES WERE RIGGED FOR ULTERIOR PURPOSES. THESE SUSPICIONS HAD BEEN CONFIR MED BY THE REPORT OF INVESTIGATION WING AND THE REPORT OF THE SEBI WHICH AS POINTED OUT BY THE AO HAD SUSPENDED TRADING IN THESE TWO SHARES. THE DIVERGENT RANGE IN PRICE FLUCTUATION OF BOTH SHARES RAISES DOUBTS ABOUT THE GENUINENESS OF TRANSACTIONS IN THESE SHARES WHICH A PPEARS TO BE BOGUS. AFTER CAREFUL CONSIDERATION OF THE SUBMISSION OF TH E APPELLANT, THE RELEVANT ASSESSMENT RECORDS, AND THE DATA OF SHARE PRICES OF M/S UNNO I NDUSTRIES LIMITED AND M/S LUMINAIRE PAGE 10 TECHNOLOGIES AS TRADED IN BSE, IT HAS TO BE HELD TH AT THE ABNORMAL APPRECIATION OF SHARE PRICE WHICH IS NOT SUPPORTED BY ANY FINANCIAL FUNDA MENTALS IS NOTHING BUT A COLOURABLE DEVICE FOR THE AVOIDANCE OF TAXES. THE APPELLANT HAS INDUL GED IN CHICANERY AND MANIPULATION TO LAUNDER HIS UNDISCLOSED INCOME THROUGH A SERIES OF BOGUS TRANSACTIONS. THE ADDITION OF RS.6,50475/- AS UNEXPLAINED CASH CREDIT U/S. 68 IS SUSTAINED. THE APPEAL ON THESE GROUNDS FAILS AND IS THEREFORE DISMISSED. THE AO IS DIRECTE D ACCORDINGLY. 5 IN THE RESULT, THE APPEAL IS DISMISSED. 4. I HAVE GIVEN MY THOUGHTFUL CONSIDERATION TO RIVA L CONTENTIONS. LEARNED DEPARTMENTAL REPRESENTATIVE VEHEMENTLY SUPPORTS BOT H THE LOWER AUTHORITIES IDENTICAL ACTION HOLDING THE ASSESSEES STCL AS BOGUS SINCE D ERIVED FROM RIGGING OF THE SCRIP PRICES IN ISSUE AND INVOLVING ACCOMMODATION ENTRY I N COLLUSION WITH THE CONCERNED ENTRY OPERATORS. HON'BLE APEX COURTS DECISIONS IN SUMATI DAYAL VS. CIT (1995) 80 TAXMANN.89/214 ITR 801 (SC) AND CIT VS. DURGA PRASAD MORE (1971) 82 ITR 540 (SC) ARE QUOTED BEFORE ME DURING THE COURSE OF HEAR ING AT THE REVENUES BEHEST. IT STRONGLY ARGUES THAT THE DEPARTMENT HAS DISALLOWED/ ADDED THE IMPUGNED STCL BASED ON CIRCUMSTANTIAL EVIDENCE UNEARTHED AFTER A SERIES OF SEARCH ACTIONS / INVESTIGATIONS UNDERTAKEN BY THE DDIT(INV). I FIND NO MERIT IN REV ENUES INSTANT ARGUMENTS. THE FACT REMAINS THAT THE ASSESSEE HAS DULY PLACED ON R ECORD THE RELEVANT CONTRACT NOTES, SHARE CERTIFICATE(S), DETAILED CORROBORATIVE DOCUME NTARY EVIDENCE INDICATING PURCHASE / SALE OF SHARES THROUGH REGISTERED BROKERS BY BANKIN G CHANNEL, DEMAT STATEMENTS ETC., THE REVENUES ONLY CASE AS PER ITS PLEADINGS AND BO TH THE LOWER AUTHORITIES UNANIMOUSLY CONCLUSION THAT THERE IS VERY STRONG CI RCUMSTANTIAL EVIDENCE AGAINST THE ASSESSEE SUGGESTING BOGUS STCL ACCOMMODATION ENTRIE S. I FIND THAT THERE IS NOT EVEN A SINGLE CASE WHICH COULD PIN-POINT ANY MAKING AGAINS T THESE ASSESSEES WHICH COULD BE TAKEN AS A REVENUE NEXUS. I MAKE IT CLEAR THAT THE CBDTS CIRCULAR DATED 10.03.2003 HAS ITSELF MADE IT CLEAR THAT MERE SEARCH STATEMENT S IN THE NATURE OF ADMISSION IN ABSENCE OF SUPPORTIVE MATERIAL DO NOT CARRY WEIGHT. I NOTICE THAT THIS TRIBUNALS CO- ORDINATE BENCHS DECISION IN ITA NO. 2474/KOL/2018 IN MAHAVIR JHANWAR VS. ITO DECIDED ON 01.02.2019 HAS TAKEN INTO CONSIDERATION IDENTICAL FACTS AND CIRCUMSTANCES AS WELL AS LATEST DEVELOPMENTS ON LEGAL SIDE WHILST DELETING THE SIMILAR BOGUS LTCG ADDITION AS FOLLOWS:- PAGE 11 2. THE SOLE ISSUE THAT ARISES FOR MY ADJUDICATION I S WHETHER THE ASSESSING OFFICER WAS RIGHT IN REJECTING THE CLAIM OF THE ASSESSEE THAT H E HAD EARNED LONG TERM CAPITAL GAINS ON PURCHASE AND SALE OF THE SHARES OF M/S UNN O INDUSTRIES. THE AO BASED ON A GENERAL REPORT AND MODUS OPERANDI ADOPTED GENERALLY AND ON GENERAL OBSERVATIONS HAS CONCLUDED THAT THE ASSESSEE HAS CLAIMED BOGUS L ONG TERM CAPITAL GAIN. HE MADE AN ADDITION OF THE ENTIRE SALE PROCEEDS OF THE SHAR ES AS INCOME AND REJECTED THE CLAIM OF EXEMPTION MADE U/S 10(38) OF THE ACT. THE EVIDEN CE PRODUCED BY THE ASSESSEE IN SUPPORT OF THE GENUINENESS OF THE TRANSACTION WAS R EJECTED. 3. THE ASSESSEE CARRIED THE MATTER IN APPEAL AND TH E LD. CIT(A), KOLKATA, HAD UPHELD THE ADDITION. THE LD. CIT(A) HAS IN HIS ORDER RELIE D UPON CIRCUMSTANTIAL EVIDENCE AND HUMAN PROBABILITIES TO UPHOLD THE FINDINGS OF THE AO. HE ALSO RELIED ON THE SO CALLED RULES OF SUSPICIOUS TRANSACTION . NO DIRECT MATERIAL WAS FOUND TO CONTROVERT THE EVIDENCE FILED BY THE ASSESSEE, IN SUPPORT OF T HE GENUINENESS OF THE TRANSACTIONS. IN OTHER WORDS, THE OVERWHELMING EVIDENCE FILED BY THE ASSESSEE REMAINS UNCHALLENGED AND UNCONTROVERTED. THE ENTIRE CONCLUSIONS DRAWN BY THE REVENUE AUTHORITIES, ARE BASED ON A COMMON REPORT OF THE DIRECTOR OF INVESTI GATION, KOLKATA, WHICH WAS GENERAL IN NATURE AND NOT SPECIFIC TO ANY ASSESSEE. THE ASSESSEE WAS NOT CONFRONTED WITH ANY STATEMENT OR MATERIAL ALLEGED TO BE THE BA SIS OF THE REPORT OF THE INVESTIGATION WING OF THE DEPARTMENT AND WHICH WERE THE BASIS ON WHICH CONCLUSION WERE DRAWN AGAINST THE ASSESSEE. COPY OF THE REPORT WAS ALSO NOT GIVEN. 4. THE LD. D/R, SUBMITTED THAT THE TRANSACTION WAS NOT GENUINE. HE ARGUED THAT THE ENTIRE CAPITAL GAIN WAS STAGE MANAGED BY A FEW OPER ATORS AND INVESTORS. HE RELIED ON THE ORDER OF LD. ASSESSING OFFICER AND ARGUED THAT THE SAME BE UPHELD. HE RELIED ON THE ORDER OF THE CHENNAI A BENCH OF THE TRIBUNAL IN THE CASE OF M/S. PANKAJ AGARWAL & SONS (HUF) VS. ITO IN ITA NO. 1413 TO 142 0/CHNY/2018; ORDER DT. 06/12/2018, FOR THE PROPOSITION THAT SUCH CAPITAL G AINS HAVE TO BE BROUGHT TO TAX. HE ALSO RELIED ON THE JUDGMENT OF THE HONBLE BOMBAY H IGH COURT IN THE CASE OF SANJAY BIMALCHAND JAIN VS. PRINCIPAL COMMISSIONER OF INCOM E-TAX-1, NAGPUR; [2018] 89 TAXMANN.COM 196 (BOMBAY) AND THE DECISION OF THE SM T. M.K. RAJESHWARI VS. ITO; ITA NO.1723/BNG/2018; ASSESSMENT YEAR 2015-16, ORDE R DT. 12/10/2018. 5. AFTER HEARING BOTH SIDES, I FIND THAT IN A NUMBE R OF CASES THIS BENCH OF THE TRIBUNAL AND JURISDICTIONAL CALCUTTA HIGH COURT HAS CONSISTE NTLY HELD THAT, DECISION IN ALL SUCH CASES SHOULD BE BASED ON EVIDENCE AND NOT ON GENERA LISATION, HUMAN PROBABILITIES, SUSPICION, CONJECTURES AND SURMISES. IN ALL CASES A DDITIONS WERE DELETED. SOME OF THE CASES WERE, DETAILED FINDING HAVE BEEN GIVEN ON THI S ISSUE, ARE LISTED BELOW: - SL.NO. ITA NO.S NAME OF THE ASSESSEE DATE OF ORDER/JUDGMENT 1 ITA NO.714 TO 718/KOL/2011 ITAT, KOLKATA DICT VS. SUNITA KHEMKA 28.10.2015 2 214 ITR 244 CALCUTTA HIGH COURT CIT VS. CARBO IND USTRIAL HOLDINGS LTD. 3 250 ITR 539 CIT VS. EMERALD COMMERCIAL LTD. 23.03.2001 4 ITA NO.1236-1237/KOL/2017 5 ITA NO.569/KOL/2017 GAUTAM PINCHA 15.11.2017 6 ITA NO.443/KOL/2017 KIRAN KOTHARI HUF 15.11.2017 7 ITA NO.2281/KOL/2017 NAVNEET AGARWAL VS. ITO 20.0 7.2018 8 ITA NO.456 OF 2007 BOMBAY HIGH CIT VS. SHRI MUKES H RATILAL 18.01.2018 PAGE 12 COURT MAROLIA 9. ITA NO.95 OF 2017 (O&M) PCIT VS. PREM PAL GANDHI 18.01.2018 10 ITA NO.1089/KOL/2018 SANJAY MEHTA 28.09.2018 6. REGARDING THE CASE LAWS RELIED UPON BY THE LD. DEPARTMENTAL REPRESENTATIVE, I FIND THAT, IN THE CASE OF M/S. PANKAJ AGARWAL & SON S (HUF)(SUPRA), THE ISSUE WAS DECIDED AGAINST THE ASSESSEE FOR THE REASON THAT, T HE ASSESSEE COULD NOT JUSTIFY HIS CLAIM AS GENUINE BY PRODUCING EVIDENCE AND WAS ONLY ARGUING FOR THE MATTER TO BE SET ASIDE TO THE LOWER AUTHORITIES ON THE GROUND OF NAT URAL JUSTICE. AS SIMILAR ARGUMENTS WERE NOT RAISED BEFORE THE LOWER AUTHORITIES BY THE ASSESSEE, THE ITAT REJECTED THESE ARGUMENTS. IN THE CASE ON HAND, ALL EVIDENCES WERE PRODUCED BY THE ASSESSEE. IN THE CASE OF SANJAY BIMALCHAND JAIN, LEGAL HEIR OF SANTI DEVI BIMALCHAND JAIN, THE HONBLE HIGH COURT UPHELD THE STAND OF THE REVENUE THAT THE TRANSACTION IN QUESTION IS AN ADVENTURE IN NATURE OF TRADE AND THE PROFIT O F THE TRANSACTIONS IS ASSESSABLE UNDER THE HEAD OF BUSINESS INCOME . IN THE CASE ON HAND, THE LD. ASSESSING OFFICER HAS NOT ASSESSED THIS AMOUNT AS BUSINESS INCOME. IN ANY EVENT, I AM BOUND TO FOLLOW THE JUDGMENT OF THE JURISDICTIONAL HIGH COURT IN TH IS MATTER. I FIND THAT THE ASSESSEE HAS FILED ALL NECESSARY EVIDENCES IN SUPPORT OF THE TRANSACTIONS. SOME OF THESE EVIDENCES ARE (A) EVIDENCE OF PURCHASE OF SHARES, ( B) EVIDENCE OF PAYMENT FOR PURCHASE OF SHARES MADE BY WAY OF ACCOUNT PAYEE CHE QUE, COPY OF BANK STATEMENTS, (C) COPY OF BALANCE SHEET DISCLOSING INVESTMENTS, ( D) COPY OF DEMAT STATEMENT REFLECTING PURCHASE, (E) COPY OF MERGER ORDER PASSE D BY THE HIGH COURT , (F) COPY OF ALLOTMENT OF SHARES ON MERGER, (G) EVIDENCE OF SALE OF SHARES THROUGH THE STOCK EXCHANGE, (H) COPY OF DEMAT STATEMENT SHOWING THE S ALE OF SHARES, (I) COPY OF BANK STATEMENT REFLECTING SALE RECEIPTS, (J) COPY OF BRO KERS LEDGER, (K) COPY OF CONTRACT NOTES ETC. 7. THE PROPOSITION OF LAW LAID DOWN IN THESE CASE LAWS BY THE JURISDICTIONAL HIGH COURT AS WELL AS BY THE ITAT KOLKATA ON THESE ISSUE S ARE IN FAVOUR OF THE ASSESSEE. THESE ARE SQUARELY APPLICABLE TO THE FACTS OF THE C ASE. THE LD. DEPARTMENTAL REPRESENTATIVE, THOUGH NOT LEAVING HIS GROUND, COUL D NOT CONTROVERT THE CLAIM OF THE LD. COUNSEL FOR THE ASSESSEE THAT THE ISSUE IN QUES TION IS COVERED BY THE ABOVE CITED DECISIONS OF THE HONBLE JURISDICTIONAL CALCUTTA HI GH COURT AND THE ITAT. I AM BOUND TO FOLLOW THE SAME. 8. IN VIEW OF THE ABOVE DISCUSSION I DELETE THE AD DITION MADE U/S 68 OF THE ACT, ON ACCOUNT OF LONG TERM CAPITAL GAINS. 5. COUPLED WITH THIS, HON'BLE JURISDICTIONAL HIGH C OURTS OTHER DECISIONS IN CIT VS. RUNGTA PROPERTIES PVT. LTD. ITA NO.105 OF 2016, CIT VS. SHREYAHI GANGULY ITA NO. 196 OF 2012, M/S CLASSIC GROWERS LTD VS. CIT ITA NO . 129 OF 2012 ALSO HOLD SUCH TRANSACTIONS IN SCRIPS SUPPORTED BY THE CORRESPONDI NG RELEVANT EVIDENCE TO BE GENUINE. I ADOPT THE ABOVE EXTRACTED REASONING MUTATIS MUTANDIS THEREFORE TO DELETE THE IMPUGNED STCL DISALLOWANCE / ADDITION OF RS.6,50,47 5/-. UNEXPLAINED COMMISSION PAGE 13 EXPENDITURE DISALLOWANCE, IF ANY SHALL AUTOMATICALL Y FOLLOW SUIT AS A NECESSARY COROLLARY. NO OTHER ARGUMENT OR GROUND HAS BEEN AGI TATED BEFORE ME DURING THE COURSE OF HEARING. THIS LEAD CASE ITA NO.258/KOL/2019 IS ALLOWED IN ABOVE TERM S. [ SAME ORDER TO FOLLOW IN ALL THE REMAINING SIXTEEN APPEAL (S) ] IN ABSENCE OF ANY DISTINCTION BEING POINTED OUT AT REVENUES BEHEST. 6. ALL THESE ASSESSEES SEVENTEEN APPEALS ARE ALLOW ED IN ABOVE TERMS. A COPY OF THE INSTANT COMMON ORDER BE PLACED IN THE RESPECTIV E CASE FILE(S). ORDER PRONOUNCED IN OPEN COURT ON 28/06/2019 SD/- (S.S. GODARA) JUDICIAL MEM BER KOLKATA, *DKP/SR.PS ' - 28/06/2019 / COPY OF ORDER FORWARDED TO:- 1. /APPELLANT-SRI VIKASH AJHAWAR 142, OLD CHINA BAZAR, ST, 3 RD FL, BHIKAMCHAND M ARKET, KOLKATA-001/MAAN VARDHAN BAID HUF, 313, TOD I CHAMBERS, 2, LAL BAZARE ST. KOLKATA-001/ ANAND KEDIA, 29, R.N.MUKHERJEE, RD, WINDSOR HOUSE,2 ND FL, R.NO.15, KOLKATA-001/M/S DEWDROP SECURITIES PVT. LTD. GD-278, SEC TOR-II, SALT LAKE CITY, KOLKATA-106/SONA KR. SHOW C/O S.N. GHOSH & ASSOCAITES, ADVOCATES SEVEN BROTHERSLODGE P.O. BUROSHIBTALA, P.S. CHINSURAH, DIST. HOOGHLY-712105 /MANISHA MADHOGOARIA C/O S.L. KOCHAR, ADVOCATE, 5, ASHUTOSH CHOWDHURY, AVENUE, KOLKATA-19/ SHRI SUSHIL KR . BARDIA, 20, N.S.ROAD, KOLKATA-001/RAMAKANT BERIWALA, 5 CLIVE ROW, R .NO.23, KOLKATA-001/NAND KISHORE AGARWALA-NANE KOSHORE AGARWALA L/H OF GITA DEVI AGARWALA (DECEASED),25, SABJAI BAGAN, LANE, CHETLA, KOLKATA-27/MANJU CHOWDHARY-M/S D EVI PRASAD CHOWDHARY, HUF, PHASE-5,BLOCK 9, VIVEK VIHIA R, 493/C/A, G.T. ROAD, HOWRAH-711102/SNEHA GOENKA-RAHUL GOE NKA, FLAT NO.5A, PHASE-5, BLOCK 9, VIVEK VIHAR, 493/C/A , G.T.ROAD, HOWRAH-711102/MAHABIR PRASAD BANKA 107C, TOD I CHAMBERS, 2 LAL BAZAR ST. KOLKATA/B.N. AGARWAL & SONS (HUF), BALAJI APARTMENTS, 52/1, HAZRA ROAD, KOLKATA-19 2. /RESPONDENT-ITO WD-36(4)-35(4), 110, SHANTIPALLY, 8 TH FLOOR. NR. RUBY PAGE 14 HOSPITAL, E.M. BYEPASS, KOLKATA-107/ITO WD-22(4), 54/1 RAFI AHMED KID WAI RD. 3 RD FL, KOLKATA-16/ITO WD-6(4), 169, AJC BOSE ROAD, 9 TH FL.KOLAKTA-16/ITO WD-62(2), 169, AJC BOSE ROAD, KOLK ATA-16/ACIT, WD-23(1), AAYKAR BHAWAN, G.T. ROAD, KHADINA MORE, P.O&P.S. CHINSURAH, DIST. HOOGHLY- 712101/ITO WD- 47(4), 3, GOVT. PLACE (WEST), KOLKATA-001/ ITO WD-36(2), 9 TH FL, AAYKAR BHAVAN, POORVA, 110, SHANTI PALLY, KOLKATA -107ITO WD-36(1)-35(2), AAYKAR BHAWAN POORVA, 10, SH ANTIPALLY, KOLKATA-107/ITO WD-46(3),-47(1) 3 GOVT. PLACE (WEST), 2 ND FL, KOLKATA-001/ITO WD-46(3)- 47(1), 3, GOVT . PLACE (WEST), 2 ND FL, KOLKATA-001/ITO WD-35(4), AAYKA R BHAWAN, POORVA, 110, SHANTIPALLY, KOL-107/ ACIT, CIR-46, 3, GOVT. PLACE (WEST), KOLKATA-001 3. % ' / CONCERNED CIT 4. ' - / CIT (A) 5. ( ++% , % / DR, ITAT, KOLKATA 6. - / GUARD FILE. BY ORDER/ , /TRUE COPY/ %,
