The ITO, Ward-5(2)(2), Ahmedabad V. Smt. Jahnaviben Ashishbhai Patel, Ahmedabad

ITA 1653/AHD/2019

• Counselvise Citation: [2021] 104 COUNSELVISE.COM (IT) 6825 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 1 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-12-2021
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2011-2012
• Appeal Filed On: 04-11-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 148

Judgement Text

आयकर अपील य अ धकरण, अहमदाबाद यायपीठ ‘SMC’ अहमदाबाद । IN THE INCOME TAX APPELLATE TRIBUNAL “SMC” BENCH, AHMEDABAD (Conducted through Virtual Court) BEFORE SHRI RAJPAL YADAV, VICE-PRESIDENT AND SHRI WASEEM AHMED, ACCOUNTANT MEMBER ITA No.1653/Ahd/2019 With Cross Objection No.24/Ahd/2020 नधा रण वष / Asstt.Year : 2011-12 ITO, Ward-5(2)(2) Ahmedabad. Vs. Jahnavi Ashishbhai Patel 2, Vithalbhai Patel Colony Nr.Sardar Patel Colony Stadium Road Ahmedabad. PAN : ACTPP 8343 C (Applicant) (Responent) Revenue by : Shri Kamlesh Makana, Sr.DR Assessee by : None स ु नवाई क तार ख/Date o f He ar in g : 1 1/ 11 /2 02 1 घोषणा क तार ख /D ate o f Pr on ou nce me nt : 0 8/ 12 / 20 21 आदेश/ O R D E R PER RAJPAL YADAV, VICE-PRESIDENT: Revenue is in appeal against order of the ld.CIT(A)-5, Ahmedabad dated 7.8.2019 passed for the Asstt.Year 2011-12. Upon receipt of notice on Revenue’s appeal, the assessee has filed cross objection bearing no.24/Ahd/2000. Both are disposed of by this common order. 2. None appeared on behalf of the assessee, therefore, we proceed to dispose of appeal of the Revenue and CO of the assessee ex parte qua the assessee-respondent. ITA No.1653 /Ahd/2019 with CO 2 3. First we take up Revenue’s appeal. 4. Revenue has taken four grounds of appeal, but its grievance revolves around a single issue, viz. the ld.CIT(A) has erred in deleting the disallowance of Rs.3,94,375/-. 5. Brief facts of the case are that the assessee has filed its return of income on 6.12.2012 declaring total income at Rs.69,362/-. The assessee has claimed long term capital gain of Rs.3,94,375/- which was claimed as exempt under section 10(38) of the Income Tax Act. The assessment of the assessee was reopened by issuance of notice under section 148 on 30.3.2018. Revenue was of the view that the assessee made investment in the shares of Radhe Developers India Ltd. The ADIT has transmitted information to the AO exhibiting the fact that the shares value of this company was raised from Rs.1.10 to Rs.28.80 between January 3, 2012 to September 18, 2017 with daily average value of 19439 shares and total volume of 128641 shares. The Revenue was of the view that in spite of weak financials, shares were increasing, hence BSE has suspended the trading in securities of this company. In this background, Revenue was of the view that it was a bogus long term capital. The ld.AO has disallowed the claim of the assessee, and made addition of Rs.3,94,375/-. 6. On appeal, the ld.CIT(A) has deleted disallowance by observing as under: ITA No.1653 /Ahd/2019 with CO 3 “5.3 I have considered the facts of the case and submission made by the appellant. In the assessment order, it is noted by the AO that the assessee has earned long term capital gain income on sale of shares of M/s.Radhe Developers Ltd to the tune of Rs.3,94,375/- and the same was claimed as exempt u/s 10(38) of the Act. The AO treated the entire transaction as bogus and disallowed the same treating it as income from undisclosed sources and made addition to the total income. 5.4 The appellant has given the evidence during the assessment proceedings that the shares were bought for genuine investment since FY 2004-05 and FY 2005-06 and submitted a copy of contract note of IFCI Rnana'al Services Ltd which substantiates the claim made by the appellant. It is noticed that details like copy of contract notes of shares purchased and shares sold were filed before the AO. The AO has not brought on record any new material to disbelieve the contentions made by the appellant. The AO in the assessment order has noted that the price of the share increased considerably from Rs.1.10 to Rs.28.80 between 3/1/2012 to 18/9/2017 with daily average value of 19439 shares and total volume of 1286441 shares. However, the appellant has contended that he sold the shares of Radhe Developers India Ltd in F.Y. 2010-11 which does not fall in the period of alleged price rise. This contention of the appellant is also found to be correct as the purchase of the said share was found genuine. The case laws relied upon by the appellant and reproduced in para.5.2 also support the case of the appellant. In view of the above facts, the contention of appellant is found tenable and accordingly addition made by the AO of Rs.3,94,375/- on account of bogus capital gain is deleted.” 7. With the assistance of the ld.DR, we have gone through the record carefully. A perusal of finding of the Revenue authorities would reveal that increase in the value of the shares mentioned by the AO enhanced from 3.1.2012 to 18.9.2017. The assessee’s assessment year is A.Y.2011-12. Its transaction does not fall in this period, and for this reason, the ld.CIT(A) has treated the ITA No.1653 /Ahd/2019 with CO 4 investment with the assessee as genuine and deleted the disallowance made by the AO. After going through the well reasoned finding of the ld.CIT(A), we do not find any error in his finding, and hence, this appeal is devoid of any merit. 8. In the CO the assessee has challenged reopening of the assessment. However, at the time of hearing no arguments were put forth by the assessee in this behalf, and therefore, for want of prosecution, the CO of the assessee stands dismissed. 9. In the result, the appeal of the Revenue and CO of the assessee, both are dismissed. Order pronounced in the Court on 7 th December, 2021 at Ahmedabad. Sd/- (WASEEM AHMED) ACCOUNTANT MEMBER Sd/- (RAJPAL YADAV) VICE-PRESIDENT