VIJAY J SALVI (HUF), MUMBAI V. ITO 20(3)(4), MUMBAI

ITA 2068/MUM/2015

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 2978 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 5 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-09-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 18-02-2016
• Assessment Year: 2005-2006
• Appeal Filed On: 09-04-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ALOK JOHARI
• Assessee Lawyers: KEYURI DESAI

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI J BENCH , MUMBAI BEFORE SHRI SHAILEND RA K UMAR YADAV, JUDICIAL MEMBER, AND SHRI RAJESH KUMAR , ACCOUNTANT MEMBER . ITA. NO. 2 068 / M UM /20 1 5 (ASSESSMENT YEAR: 2 0 0 5 - 0 6 ) SHRI VIJAY J. SALVI (HUF), 16/5 , MAHANT KRUPA, MANISH NAGAR, 4 BUNGLOW, ANDHERI (W), MUMBAI 400 007 APPELLANT VS. IT O, 20(3)(4) , MUMBAI RESPONDENT PAN: AA EHV0266P / BY APPELLANT : MS. KEYURI DESAI , A.R. / BY RESPONDENT : SHRI ALOK JOHARI , D .R. / DATE OF HEARING : 2 4 . 0 8 .201 6 / DATE OF PRONOUNCEMENT : 14.9 .201 6 ORDER PER SHAILENDRA KUMAR YADAV, J . M: THIS APPEAL HAS BEEN FILED BY ASSESSEE AGAINST THE ORDER OF COMMISSIONER OF INCOME - TAX (APPEALS) - 37 , MUMBAI , DATED 08 . 01 . 20 1 5 FOR A.Y. 20 0 5 - 0 6 ON FOLLOWING GROUND S : 1) THE LEARNED CIT(A) ERRED IN UPHOLDING THE ORDER OF THE ASSESSING OFFICER DISALLOWING ALLEGED BOGUS SHARE I T A NO . 2 068 / M UM / 1 5 A.Y. 0 5 - 0 6 [ VIJAY J SALVI (HUF) VS. ITO) PAGE 2 TRANSACTION AMOUNTING TO RS.6,11,625/ - BEING THE SALE PROCEEDS RECEIVED ON SALE OF SHARES HELD FOR A PERIOD OF MORE THAN 12 MONTHS. 2. ASSESSEE IS AN INDIVIDUAL WHO FILED HIS RETURN OF INCOME FOR A.Y .2005 - 06 DECLARING TOTAL INCOME AT RS.92,917/ - . ASSESSMENT WAS SUBSEQUENTLY REOPENED BY ISSUING NOTICE U/S.148 OF THE ACT. ASSESSMENT WAS COMPLETED U/S.143(3) R.W.S. 147 OF THE ACT DETERMINING TOTAL INCOME OF RS.7,04,540/ - AS A RESULT OF ADDITION OF RS.6 ,11,625/ - AS UNDISCLOSED INCOME, WHICH WAS CONFIRMED BY CIT(A) . LEARNED AUTHORIZED REPRESENTATIVE POINTED OUT THAT SIMILAR ISSUE AROSE IN CASE OF SMC BENCH, MUMBAI IN ITA NO.2069/MUM/2015 IN CASE OF ULKA VIJAY SALVI VS. ITO, WHE R EIN FOLLOWING VARIOUS DECIS IONS, SIMILAR ISSUE HAS BEEN DECIDED IN FAVOUR OF ASSESSEE BY OBSERVING AS UNDER: 6.4 CONSIDERING THE DECISIONS STATED ABOVE, WHICH HAS BEEN RENDER ED IN IDENTICAL CIRCUMSTANCES, I FIND NO REASON TO UPHOLD THE CONCLUSION OF THE LOWER AUTHORITIES. 6.5 BEF ORE PARTING, I MAY ALSO REFER TO CERTAIN OTHER DECISIONS STATED BY THE ASSESSEE BEFORE ME, WHEREIN ALSO ADDITIONS WERE MADE ON THE BASIS OF THE STATEMENT OF MR. MUKESH CHOKSI, THOUGH THE INVESTMENT COMPANIES WERE DIFFERENT. ONE SUCH CASE WAS THE DECISION O F THE MUMBAI BENCH OF THE TRIBUNAL IN THE CASE OF MUKESH R. MAROLIA VS. ADDL. CIT, 6 SOT 247 (MUM). THE LD. REPRESENTATIVE FOR THE ASSESSEE ALSO POINTED OUT THAT SUCH JUDGMENT HAS SINCE BEEN APPROVED BY THE HON'BLE BOMBAY HIGH COURT IN THE CASE OF CIT VS. SHRI MUKESH RATILAL MAROLIA, INCOME TAX APPEAL NO.456 OF 2007 DATED 07/09/2011. 6.6 CONSIDERING THE AFORESAID DISCUSSION, IN MY VIEW, THE CIT(A) FELL IN ERROR IN UPHOLDING THE CONCLUSION OF THE ASSESSING OFFICER THAT THE SALE AND PURCHASE OF SHARES OF I T A NO . 2 068 / M UM / 1 5 A.Y. 0 5 - 0 6 [ VIJAY J SALVI (HUF) VS. ITO) PAGE 3 M/S . BUNIYAD C HEMICALS LTD., WAS A BOGUS TRANSACTION. ACCORDINGLY, THE ORDER OF THE CIT(A) IS SET ASIDE AND THE ASSESSING OFFICER IS DIRECTED TO DELETE THE ADDITION OF RS.3,94,135/ - . 2.1 NOTHING CONTRARY WAS BROUGHT TO OUR KNOWLEDGE, SO FOLLOWING SAME REASO NING, WE HOLD THAT ASSESSING OFFICER ERRED IN DISALLOWING ALLEGED BOGUS SHARE TRANSACTION AMOUNTING TO RS.6,11,625/ - BEING THE SALE PROCEEDS RECEIVED ON SALE OF SHARES HELD FOR A PERIOD OF MORE THAN 12 MONTHS. SAME IS DIRECTED TO BE ALLOWED. 3. IN THE RE SULT, THE APPEAL FILED BY ASSESSEE IS ALLOWED. PRONOUNCED IN THE OPEN COURT ON THIS THE 14TH DAY OF SEPT , 201 6 . SD SD ( RAJESH KUMAR ) (SHAILENDRA KUMAR YAD AV) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI : DATED 14.9. 201 6 S.K.SINHA / COPY OF ORDER FORWARDED TO: - 1 . / REVENUE 2 . / ASSESSEE 3 . / CONCERNED CIT 4. - / CIT (A) 5 . , , / DR, ITAT, MUMBAI 6 . / GUARD FILE. BY ORDER / , TRUE COPY / , ,