Appeal Details
Counselvise Citation
[2020] 111 COUNSELVISE.COM (IT) 9602 (ITAT-DELHI)
Assessee PAN
Bench
Appeal Number
CRN Number
Duration Of Justice
10 month(s) 15 day(s)
Appellant
Respondent
Appeal Type
Income Tax Appeal
Pronouncement Date
08-01-2020
Appeal Filed By
Assessee
Order Result
Dismissed
Bench Allotted
SMC
Assessment Year
2014-2015
Appeal Filed On
22-02-2019
Judgement Text
1 IN THE INCOME TAX APPELLATE TRIBUNAL, DELHI SMC BENCH, NEW DELHI BEFORE SHRI H.S. SIDHU, JUDICIAL MEMBER ITA NO. 1508/DEL/2019 [ASSESSMENT YEAR: 2014-15] NARENDER AGGARWAL (HUF), VS. ITO, WARD-39(4) , 212, STARLITE APARTMENT, NEW DELHI SECTOR-14 EXTN., ROHINI, DELHI - 110085 (PAN: AABHN6245F) [APPELLANT] [RESPONDENT] ITA NO. 1509/DEL/2019 [ASSESSMENT YEAR: 2014-15] NARENDRA KUMAR AGGARWAL VS. ITO, WARD-39(4) , 212, STARLITE APARTMENT, NEW DELHI SECTOR-14 EXTN., ROHINI, DELHI - 110085 (PAN: AAJPA5922G) [APPELLANT] [RESPONDENT] ASSESSEE BY: SH. R.K. KAPOOR, ADV REVENUE BY : SH. SANJOG KAPOOR, SR. DR. ORDER THESE 02 APPEALS HAVE BEEN FILED BY THE ASSESSEE IN THE CAPACITY OF HUF AS WELL AS INDIVIDUAL AGAINST THE RESPECTIV E ORDERS OF THE LD. COMMISSIONER OF INCOME TAX [APPEALS]-13, NEW DELHI DATED 17.12.2018 & 14.12.2018 RESPECTIVELY. SINCE THE ISSUES INVOLV ED IN THESE APPEALS ARE COMMON AND IDENTICAL, HENCE, BOTH THE APPEALS W ERE HEARD TOGETHER AND ARE BEING DISPOSED OF BY THIS COMMON ORDER BY F IRST DEALING WITH ITA NO. 1508/DEL/2019 (AY 2014-15) AND THE DECISION THE REOF WILL APPLY MUTATIS MUTANDIS TO OTHER ITA NO. 1509/DEL/2019 (AY 2014-15). 2. THE GROUNDS RAISED IN ITA NO. 1508/DEL/2019 (AY 2014-15) NARENDER AGGARWAL (HUF) VS. ITO READ AS UNDER:- 2 1.THAT THE ORDER OF CIT(A) U/S 250 OF THE ACT IS BA D IN LAW AND ON FACTS OF THE ASSESSEE'S CASE. 2.THAT LD. CIT(A) HAS GROSSLY ERRED IN LAW IN CONFI RMING THE ADDITION MADE BY THE AO ON ACCOUNT OF LONG TERM CAPITAL GAIN OF RS. 21,05,853/- EARNED BY THE ASSES SEE ON SALE OF SHARES OF MIS. KAPPACPHARMA LTD. AND TRE ATED THE SAME AS BOGUS AND IS TAXABLE AS UNEXPLAINED CAS H CREDIT U/S 68 R.W.S. 115 BBE OF THE INCOME TAX ACT. 3.THAT THE LD. CIT(A)/ASSESSING OFFICER HAS GROSSLY ERRED IN LAW AND ON FACTS OF THE APPELLANT CASE IN HOLDING THAT ASSESSEE MANIPULATED THE TRANSACTIONS TO EARN LONG TERM CAPITAL GAIN. SUCH FINDINGS ARE CONT RARY TO EVIDENCES FILED BY THE ASSESSEE AND THERE IS NO EVIDENCE OF ASSESSEE'S INVOLVEMENT IN ANY WAY IN TH E ALLEGED MANIPULATIONS. 4.THAT THE FINDINGS AND ALLEGATIONS MADE BY THE LD. CIT(A)/ AO BY RELYING ON THE OUTCOME OF ALLEGED INVESTIGATIONS MADE BY THE INVESTIGATION WING OF INCOME TAX DEPARTMENT IN KOLKATA AND OBSERVATION OF NSE/SEBI/SIT ARE BASED ON SURMISES CONJECTURES AND IMAGINATION WITHOUT ANY LIVE LINK OR INVOLVEMENT OF THE ASSESSEE WITH THE ALLEGED INVESTIGATIONS. 5. THAT THE LD. CIT(A)/AO GROSSLY ERRED IN .LAW IN HOLDING THAT THE ASSESSEE'S NAME APPEARED IN THE LI ST OF BENEFICIARIES INVESTIGATED BY THE KOLKATA INVESTIGA TION WING OF THE INCOME TAX DEPARTMENT AND INFERENCES DRAWN AGAINST THE ASSESSEE ARE BASED ON SURMISES, CONJECTURES AND UNSUBSTANTIATED ALLEGATIONS. THUS, THE ADDITIONS MADE BASED ON NO EVIDENCE AGAINST THE ASSESSEE AND ARE PRAYED TO BE DELETED. 6. THAT THE FINDINGS AND ALLEGATIONS MADE BY THE LD . AO FURTHER UPHELD BY LD. CIT(A)IN HIS ORDER ARE BASE D ON NO EVIDENCE AGAINST THE ASSESSEE AND ARE TOTALLY UNSUBSTANTIATED AND HAS NO EVIDENTIARY VALUE AGAINS T THE ASSESSEE. 7. THAT THE LD. CIT(A)/ASSESSING OFFICER FAILED TO CONSIDER THE EVIDENCES FILED BY THE ASSESSEE IN CONNECTION WITH EARNING OF EXEMPT LONG TERM CAPITAL GAIN AND PROCEEDED WITH A PRE-CONCEIVED MIND TO MAK E THE ADDITION U/S 68 R.W.S. 115 BBE OF THE INCOME TA X ACT. 8. THAT THE LD. AO HAS PASSED THE ORDER AND FURTHER CONFIRMED BY THE LD. CIT(A) BY COLLECTING THE EVIDE NCES AT THE BACK OF THE ASSESSEE WITHOUT CONFRONTING SUC H EVIDENCES TO THE ASSESSEE WHICH IS AGAINST THE PRIN CIPLES OF FAIR PLAY AND NATURAL JUSTICE. THE ORDER PASSED IGNORING THESE' VITAL PRINCIPLES IS PRAYED TO BE QU ASHED. 3 9. THAT ADDITIONS MADE BY AO AND UPHELD BY LD. CIT(A) BASED ON CERTAIN STATEMENTS OF PERSONS ETC. WHICH HAS NO CONNECTION OR LIVE LINK WITH THE STATE MENT OF AFFAIRS OF THE ASSESSEE AND COLLECTED AT THE BAC K OF THE ASSESSEE IS PRAYED TO BE EXPUNGED FROM ORDER. 10. THAT THE LD. CIT(A)/ ASSESSING OFFICERGROSSLY ERRED IN LAW IN HOLDING THAT ASSESSEE WAS NOT REGUL AR ORDINARY INVESTOR ALTHOUGH IT WAS HOLDING SHARES IN MANY OTHER COMPANIES, APART FROM M/S. KAPPAC PHARMA LTD. 11. THAT NO EVIDENCE HAS BEEN BROUGHT ON RECORD OF THE HON'BLE CIT(A)/ASSESSING OFFICER WHICH CONVEYS THAT ASSESSEE WAS INVOLVED IN CONVERTING ITS UNACCOUNTED MONEY THROUGH THE ROUTE OF EXEMPT CAPITAL GAINS. TH E ORDER IS PRAYED TO BE DECLARED AS NULL AND VOID. 12. THAT THE REFERENCES MADE BY THE LD. AO IN HIS ORDER TO THE MODUS OPERANDI ADOPTED BY THE CERTAIN UNRELATED CONCERNS/PERSONS AND FURTHER UPHELD BY TH E LD. CIT(A) HAS NO CONNECTION OR RELEVANCE TO THE FA CTS OF THE ASSESSEE'S CASE AND THE SAME ARE PRAYED TO B E EXPUNGED. 13. THAT THE FINDINGS AND OBSERVATIONS OF THE LD. CIT(A)/ASSESSING OFFICER IN THEIR ORDERS REGARDING P ENNY STOCK IS BASED ON CONJECTURES, SURMISES AND IMAGINA TION AND ARE PRAYED TO BE HELD AS LEGALLY UNTENABLE. 14. THAT THE LD. CIT(A) GROSSLY ERRED IN LAW BY NO T APPRECIATING THE JUDGEMENTS ON WHICH THE ASSESSEE RELIED UPON AND NOT DISTINGUISHED THE FACTS OF THE ASSESSEE'S CASE WITH THESE JUDGEMENTS. THUS, PRAYED TO BE APPLIED ON THE ASSESSEE'S CASE. 15. THAT THE RELIANCE OF THE LD. CIT(A)/AO ON CERTAI N JUDGMENTS IN THE CIT(A) ORDER AS WELL AS ASSESSMENT ORDER ARE MISPLACED AND PRAYED NOT TO BE APPLIED ON THE ASSESSEE'S FACTS. 16. THAT THE LD. CIT/AO GROSSLY ERRED IN LAW IN TREATING THE TRANSACTION OF SALE OF SHARES OF KAPPA C PHARRNA LTD. AS INGENUINE ALTHOUGH THE TRANSACTION OF PURCHASE OF SUCH SHARES WAS ALREADY ACCEPTED BY THE LD. AO IN EARLIER YEARS. 17. THE ADDITION MADE BY THE AO AND FURTHER CONFIRMED BY THE CIT(A) OF RS.1,43,210/- ON THE ALL EGED COMMISSION PAID TO ONE SH. DAVESH UPADHAYA IS BAD I N LAW AND IS WITHOUT EVIDENCE. 18. THAT THE ASSESSEE HAD NO LINK OR CONNECTION WIT H THE SAID UPADHAYA AND THE ADDITIONS HAS BEEN MADE O N CONJECTURES, SURMISES AND IMAGINATION AND IS PRAYED TO BE DELETED. 4 19. THAT THE CHARGING OF INTEREST U/S 234B AND 234C OF THE INCOME TAX ACT IS BAD IN LAW AND IS PRAYED TO BE DELETED. . 20. THAT THE PENALTY PROCEEDINGS INITIATED U/S SEE 271(1)(C) ARE ON WHOLLY ILLEGAL AND UNTENABLE GROUN DS SINCE THERE WAS SUBMISSION OF INACCURATE PARTICULAR S OF INCOME, BY THE ASSESSEE. 21. THAT THE AFORESAID GROUNDS ARE WITHOUT PREJUDIC E TO THE ONE ANOTHER RAISED HEREIN. PRAYER THE APPELLANT-ASSESSEE PRAYS THAT THE RELIEF AS PER GROUNDS OF APPEAL ABOVE MAY KINDLY BE ALLOWED TO IT AND THE APPELLANT MAY ALSO BE ALLOWED TO ADD, DELETE, AMEND OR SUBSTITUTE ANY GROUND(S) OF APPEAL EITHER AT OR BEFORE THE DATE OF HEARING. 3. THE GROUNDS RAISED IN ITA NO. 1509/DEL/2019 (AY 2014-15) NARENDRA KUMAR AGGARWAL VS. ITO READ AS UNDER:- 1.THAT THE ORDER OF CIT(A) U/S 250 OF THE ACT IS BA D IN LAW AND ON FACTS OF THE ASSESSEE'S CASE. 2.THAT LD. CIT(A) HAS GROSSLY ERRED IN LAW IN CONFI RMING THE ADDITION MADE BY THE AO ON ACCOUNT OF LONG TERM CAPITAL GAIN OF RS. 24,22,448/- U/S. 68 R.W.S. 115 BBE OF THE INCOME TAX ACT MADE BY THE AO BY TREATING THE LONG TERM CAPITAL EXEMPT INCOME U/S. 10(38) OF THE INCOME TAX ACT AS A TAXABLE INCOME. 3. THAT THE LD. CIT(A)/ASSESSING OFFICER HAS GROSSLY ERRED IN LAW AND ON FACTS OF THE APPELLANT CASE IN CONCLUDING THAT ASSESSEE HAD CONVERTED HIS UNACCOUNTED INCOME INTO TAX FREE INCOME THROUGH THE MECHANISM OF SALE PURCHASE OF SHARES OF M/S. KAPPAC PHARMA LTD. SUCH FINDINGS ARE CONTRARY TO EVIDENCES FILED BY THE ASSESSEE. 4. THAT THE FINDINGS AND ALLEGATIONS MADE BY THE LD . CIT(A)/AO BY RELYING ON THE OUTCOME OF ALLEGED INVESTIGATIONS MADE BY THE INVESTIGATION WING OF INCOME TAX DEPARTMENT IN KOLKATA AND OBSERVATION OF NSE/SEBI/SIT ARE BASED ON SURMISES CONJECTURES AND IMAGINATION WITHOUT ANY LIVE LINK WITH THE TRANSACT IONS OF THE ASSESSEE. 5. THAT ADDITIONS MADE BY AD AND UPHELD BY LD. CIT(A) BASED ON CERTAIN FACTS WITHIN THE KNOWLEDGE OF THE AO, WITHOUT ANY INVOLVEMENT OF THE ASSESSE ARE B AD IN LAW AND ARE PRAYED TO BE DELETED. 6. THAT THE FINDINGS AND ALLEGATIONS MADE BY THE LD . AO FURTHER UPHELD BY LD. CIT(A)IN HIS ORDER ARE BASE D 5 ON NO EVIDENCE AGAINST THE ASSESSEE AND ARE TOTALLY UNSUBSTANTIATED AND HAS NO EVIDENTIARY VALUE AGAINS T THE ASSESSEE. 7. THAT THE LD. CIT(A)/ASSESSING OFFICER FAILED TO CONSIDER THE EVIDENCES FILED BY THE ASSESSEE IN CONNECTION WITH EARNING OF EXEMPT LONG TERM CAPITAL GAIN AND PROCEEDED WITH A PRE-CONCEIVED MIND TO MAK E THE ADDITION U/S 68 R.W.S. 115 BBE OF THE INCOME TA X ACT. 8. THAT THE LD. AO HAS PASSED THE ORDER AND FURTHER CONFIRMED BY THE LD. CIT(A) BY COLLECTING THE EVIDE NCES AT THE BACK OF THE ASSESSEE WITHOUT CONFRONTING SUC H EVIDENCES TO THE ASSESSEE WHICH IS AGAINST THE PRIN CIPLES OF FAIR PLAY AND NATURAL JUSTICE. THE ORDER PASSED IGNORING THESE VITAL PRINCIPLES IS PRAYED TO BE QUA SHED. 9. THAT THE LD. CIT(A)/ASSESSING OFFICER GROSSLY ERRED IN LAW IN HOLDING THAT ASSESSEE WAS NOT REGUL AR ORDINARY INVESTOR ALTHOUGH IT WAS HOLDING SHARES IN MANY OTHER COMPANIES, APART FROM M/S. KAPPAC PHARMA LTD. 10. THAT NO EVIDENCE HAS BEEN BROUGHT ON RECORD OF THE HON'BLE CIT(A)/ASSESSING OFFICER WHICH CONVEYS THAT ASSESSEE WAS INVOLVED IN CONVERTING ITS UNACCOUNTED MONEY THROUGH THE ROUTE OF EXEMPT CAPITAL GAINS. TH E ORDER IS PRAYED TO BE DECLARED AS NULL AND VOID. 11. THAT THE REFERENCES MADE BY THE LD. AO IN HIS ORDER PERTAINING TO THE FINANCIALS OF M/S. KAPPAC P HARMA LTD. OR KAILASH AUTO FINANCE LTD. OR MODUS OPERANDI ADOPTED BY THE CERTAIN UNRELATED CONCERNS/PERSONS A ND FURTHER UPHELD BY THE LD. CIT(A) HAS NO CONNECTION OR RELEVANCE TO THE FACTS OF THE ASSESSEE'S CASE AND T HE SAME ARE PRAYED TO BE EXPUNGED. 12. THAT THE FINDINGS AND OBSERVATIONS OF THE LD. CIT(A)/ASSESSING OFFICER IN THEIR ORDERS REGARDING P ENNY STOCK IS BASED ON CONJECTURES, SURMISES AND IMAGINA TION AND ARE PRAYED TO BE HELD AS LEGALLY UNTENABLE. 13. THAT THE LD. CIT(A) GROSSLY ERRED IN LAW BY NOT APPRECIATING THE JUDGEMENTS ON WHICH THE ASSESSEE RELIED UPON AND NOT DISTINGUISHED THE FACTS OF THE ASSESSEE'S CASE WITH THESE JUDGEMENTS. THUS, PRAYED TO BE APPLIED ON THE ASSESSEE'S FACTS. 14. THAT THE RELIANCE OF THE LD. CIT(A)/AO ON CERTAI N JUDGMENTS IN THE CIT(A) ORDER AS WELL AS ASSESSMENT ORDER ARE MISPLACED AND PRAYED NOT TO BE APPLIED O N THE ASSESSEE'S FACTS. 15. THAT THE LD. CIT(A)/AO FAILED TO APPRECIATE THAT NEITHER THE ASSESSEE, NOR THE BROKER THROUGH WHOM T HE 6 ASSESSEE CARRIED OUT THE TRANSACTIONS OF SALES AND PURCHASE WERE NAMED IN THE ALLEGED INVESTIGATION AN D INFERENCES DRAWN AGAINST THE ASSESSEE ARE BASED ON SURMISES, CONJECTURES AND UNSUBSTANTIATED ALLEGATIO NS. THUS, THE ADDITIONS MADE BASED ON NO EVIDENCE AGAI NST THE ASSESSEE AND ARE PRAYED TO BE DELETED. 16. THAT THE LD. CIT/AO GROSSLY ERRED IN LAW IN TREATING THE TRANSACTION OF SALE OF SHARES OF KAPPA C PHARMA LTD. AS IN GENUINE ALTHOUGH THE TRANSACTION OF PURCHASE OF SUCH SHARES WAS ALREADY ACCEPTED BY THE LD. AO IN EARLIER YEARS. 17. THAT THE CHARGING OF INTEREST U/S 234 BAND 234C OF THE INCOME TAX ACT IS BAD IN LAW AND IS PRAYED TO BE DELETED. 18. THAT THE PENALTY PROCEEDINGS INITIATED U/S 271(1)(C) ARE ON WHOLLY ILLEGAL AND UNTENABLE GROUN DS SINCE THERE WAS SUBMISSION OF INACCURATE PARTICULAR S OF INCOME, BY THE ASSESSEE. 19. THAT THE AFORESAID GROUNDS ARE WITHOUT PREJUDIC E TO THE ONE ANOTHER RAISED HEREIN. PRAYER THE APPELLANT-ASSESSEE PRAYS THAT THE RELIEF AS PER GROUNDS OF APPEAL ABOVE MAY KINDLY BE ALLOWED TO IT AND THE APPELLANT MAY ALSO BE ALLOWED TO ADD, DELETE, AMEND OR SUBSTITUTE ANY GROUND(S) OF APPEAL EITHER AT OR BEFORE THE DATE OF HEARING. 2. AT THE TIME OF HEARING, LD. SR. DR STATED THAT T HE ISSUE REGARDING THE SHARES OF M/S KAPPAC PHARMA LTD. HAS BEEN ADJUD ICATED AND DECIDED BY THE ITAT, DELHI BENCHES IN THE CASE OF UDIT KALR A VS. ITO DECIDED IN ITA NO. 6717/DEL/2017 ON 08.1.2019 IN FAVOUR OF THE REVENUE, WHEREIN THE SHARES OF M/S KAPPAC PHARMA LTD. HAS BEEN DECLA RED BOGUS AND M/S KAPPAC PHARMA HAS BEEN DELISTED BY THE STOCK EXCHAN GE. HE FURTHER STATED THAT THE ORDER OF THE ITAT, DELHI BENCHES IN THE CASE OF UDIT KALRA VS. ITO (SUPRA) HAS BEEN UPHELD BY THE HONBLE DELH I HIGH COURT IN ITA NO. 220/2019 & CM NO. 10774/2019 VIDE ORDER DATED 0 8.3.2019. HE HAS ALSO FILED THE COPY OF THE ORDER DATED 8.3.2019 PAS SED BY THE HONBLE DELHI HIGH COURT AND REQUESTED THAT BY FOLLOWING TH E AFORESAID PRECEDENTS THE APPEAL OF THE ASSESSEE MAY BE DISMISSED. 7 3. HOWEVER, LD. COUNSEL FOR THE ASSESSEE REITERATED THE GROUNDS OF APPEAL AND HAS NOT PRODUCED ANY CONTRARY ORDER WHIC H CONTROVERTS THE CONTENTION OF THE LD. DR, AS AFORESAID. HE DRAW MY ATTENTION TOWARDS PAPER BOOK CONTAINING PAGES 1-70 IN WHICH HE HAS AT TACHED THE MEMORANDUM OF APPEAL IN FORM NO. 36; GROUNDS OF APP EAL; CERTIFIED TRUE COPY OF ASSESSMENT ORDER DATED 29.12.2016 U/S 143(3 ) OF THE ACT PASSED BY THE ITO; CERTIFIED COPY OF CIT(A) ORDER U/S. 250 OF THE ACT DATED 17.12.2018 PASSED BY THE LD. CIT(A)-13, NEW DELHI; FORM NO. 35, GROUNDS OF APPEAL AND STATEMENT OF FACTS BEFORE CIT (A), NEW DELHI, TRIBUNAL FEE CHALLAN FOR RS. 10,000/- AND POWER OF ATTORNEY IN OUR FAVOUR. HE HAS DRAW MY ATTENTION TOWARDS ANOTHER PAPER BOOK CONTAINING PAGES 1-175 IN WHICH HE HAS ATTACHED THE VARIOUS COPIES O F THE DECISIONS OF THE TRIBUNAL, HONBLE HIGH COURTS AND THE HONBLE SUPRE ME COURT OF INDIA TO SUPPORT THE CASE OF THE ASSESSEE AND ALSO STATED TH AT THE CASE LAWS RELIED BY THE LD. SR. DR IS DISTINGUISHED ON THE FACTS OF THE PRESENT CASE AS MENTIONED IN THE WRITTEN SUBMISSIONS AS WELL AS IN THE PAPER BOOK FILED BY THE LD. COUNSEL FOR THE ASSESSEE. 4. I HAVE HEARD BOTH THE PARTIES AND PERUSED THE OR DERS PASSED BY THE REVENUE AUTHORITIES INCLUDING THE ITAT ORDER DATED 8.1.2019 PASSED IN THE CASE OF UDIT KALRA VS. ITO DECIDED IN ITA NO. 6717/ DEL/2017 IN WHICH THE UNDERSIGNED WAS THE AUTHOR, WHICH WAS DECIDED IN FA VOUR OF THE REVENUE AND THE SAME HAS BEEN UPHELD BY THE HONBLE DELHI H IGH COURT IN THE CASE OF UDIT KALRA VS. ITO IN ITA NO. 220/2019 & CM NO. 10774/2019 VIDE ORDER DATED 08.3.2019. AFTER GOING THROUGH THE DOC UMENTARY EVIDENCES FILED BY BOTH THE PARTIES, I AM OF THE CONSIDERED VIEW THAT THE SHARES OF M/S KAPPAC PHARMA LTD. AS HELD BY THE ASSESSEE IN T HE PRESENT CASE, THE GENUINENESS OF THE SAME HAS ALREADY BEEN EXAMINED B Y THE ITAT DELHI BENCHES IN THE CASE OF UDIT KALRA (SUPRA) AND FIND THAT M/S KAPPAC PHARMA LTD. HAS BEEN DE-LISTED FROM THE STOCK EXCHA NGE AND IS SUSPICIOUS AND WAS DENIED THE EXEMPTION U/S. 10(38) OF THE I.T . ACT, 1961 BY TREATING THE ACCOMMODATION ENTRIES AS BOGUS. AS REGARDS THE OTHER LEGAL ISSUES RAISED IN THE GROUNDS OF APPEAL, I AM OF THE CONSIDERED VIEW 8 THAT HONBLE DELHI HIGH COURT IN THE CASE OF UDIT K ALRA VS. ITO (SUPRA) HAS NOT GIVEN WEIGHTAGE TO THESE LEGAL GROUNDS BECAUSE WHEN M/S KAPPAC PHARMA HAS ALREADY BEEN DECLARED AS BOGUS AND IT M ADE TO PROVIDE THE ACCOMMODATION ENTRIES IN WHICH THE PRESENT ASSESSEE IS A BENEFICIARY, THEN THE ASSESSEE IS NOT ENTITLED FOR GETTING BENEF IT IN SUCH TECHNICAL/LEGAL GROUNDS. FOR THE SAKE OF CONVENIENCE, THE RELEVANT PORTION OF THE JUDGMENT OF THE HONBLE HIGH COURT OF DELHI DECIDED IN THE CASE OF UDIT KALRA VS. ITO (SUPRA) IS REPRODUCED AS UNDER:- 'THE ASSESSEE IS AGGRIEVED BY THE CONCURRENT FINDIN GS OF THE TAX AUTHORITIES - INCLUDING THE LOWER APPELLATE AUTHORITIES REJECTING ITS CLAIM FOR A LONG TERM CAP ITAL GAIN REPORTED BY IT, TO THE TUNE OF RS.13,33,956/- AND RS.14,34,501/- IN RESPECT OF 4,000 SHARES OF M/S KAPPAC PHARMA LTD. THE ASSESSEE HELD THOSE SHARES F OR APPROXIMATELY 19 MONTHS; THE ACQUISITION PRICE WAS RS.12/- PER SHARE WHEREAS THE MARKET PRICE OF THE SHARES AT THE TIME OF THEIR SALE, WAS RS.720/-. IT IS CONTENDED THAT THE ASSESSEE WAS NOT GRANTED FAIR OPPORTUNITY. MR. RAJESH MAHNA, LEARNED COUNSEL APPEARING FOR THE ASSESSEE RELIED UPON THE ORDERS O F THE CO-ORDINATE BENCH OF THE TRIBUNAL, IN RESPECT OF TH E SAME COMPANY I.E. M/S KAPPAC PHARMA LTD., AND POINTED OUT THAT THE TAX AUTHORITY'S APPROACH IN TH IS CASE WAS ENTIRELY ERRONEOUS AND INCONSISTENT. THE M AIN THRUST OF THE ASSESSEE'S ARGUMENT IS THAT HE WAS DE NIED THE RIGHT TO CROSS-EXAMINATION OF THE INDIVIDUALS W HOSE STATEMENTS LED TO THE INQUIRIES AND ULTIMATE DISALLOWANCE OF THE LONG TERM CAPITAL GAIN CLAIM IN THE RETURNS WHICH ARE THE SUBJECT MATTER OF THE PRESENT APPEAL. THIS COURT HAS CONSIDERED THE SUBMISSIONS O F THE PARTIES. ASIDE FROM THE FACT THAT THE FINDINGS IN T HIS CASE ARE ENTIRELY CONCURRENT - AO., CIT(A) AND THE I TAT HAVE ALL CONSISTENTLY RENDERED ADVERSE FINDINGS - W HAT IS INTRIGUING IS THAT THE COMPANY (MIS KAPPAC PHARMA L TD.) HAD MEAGRE RESOURCES AND IN FACT REPORTED CONSISTEN T LOSSES. IN THESE CIRCUMSTANCES, THE ASTRONOMICAL GR OWTH OF THE VALUE OF COMPANY'S SHARES NATURALLY EXCITED THE SUSPICIONS OF THE REVENUE. THE COMPANY WAS EVEN DIRECTED TO BE DELISTED FROM THE STOCK EXCHANGE. HA VING REGARD TO THESE CIRCUMSTANCES AND PRINCIPALLY ON TH E GROUND THAT THE FINDINGS ARE ENTIRELY OF FACT, THIS COURT IS OF THE OPINION THAT NO SUBSTANTIAL QUESTION OF LAW ARISES 9 IN THE PRESENT APPEAL. THIS APPEAL IS ACCORDINGLY DISMISSED.' 4.1 AFTER GOING THROUGH THE FACTS AND CIRCUMSTANCES OF THE PRESENT CASE AND THE JUDGMENT OF THE HONBLE DELHI HIGH COURT I N THE CASE OF UDIT KALRA VS. ITO (SUPRA), I AM OF THE VIEW THAT THE HO NBLE HIGH COURT IN THE AFORESAID CASE HAS DECLARED M/S KAPPAC PHARMA AS B OGUS COMPANY WHO MADE ONLY ACCOMMODATION ENTRIES IN WHICH THE ASSESS EE IS A BENEFICIARY. THEREFORE, I HAVE NO OTHER OPTION EXCEPT TO FOLLOW THE DECISION OF THE HONBLE DELHI HIGH COURT, BECAUSE NO OTHER CONTRAR Y JUDGMENT HAS BEEN PRODUCED BY THE LD. COUNSEL FOR THE ASSESEE. ACCOR DINGLY, FOLLOWING THE AFORESAID PRECEDENT, I UPHOLD THE WELL REASONED ORD ER OF THE LD. CIT(A) AND DECIDE THE ISSUE IN DISPUTE AGAINST THE ASSESS EE BY DISMISSING THE APPEAL OF THE ASSESSEE. 5. FOLLOWING THE CONSISTENT VIEW AS TAKEN IN ITA NO . 1508/DEL/2019 AS AFORESAID, THE ITA NO. 1509/DEL/2019 ALSO STANDS DI SMISSED. 6. IN THE RESULT, BOTH THE APPEALS OF THE ASSESS EE ARE DISMISSED. THE ORDER PRONOUNCED ON 08.01.2020. SD/- [H.S. SIDHU] JUDICIAL MEMBER DATED: 08-01-2020 SRB COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) ASST. REGISTRAR, 5. DR ITAT, NEW DELHI
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