DY. COMMISSIONER OF INCOME TAX CENTRAL CIRCLE-22(1), MUMBAI V. MR BHUPESH HARISHCHANDRA RATHOD, MUMBAI

ITA 2301/MUM/2023

• Counselvise Citation: [2023] 102 COUNSELVISE.COM (IT) 0595 (ITAT-MUMBAI)
• Duration Of Justice: 3 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-10-2023
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: SMC
• Next Hearing Date: 17-10-2023
• Assessment Year: 2011-2012
• Appeal Filed On: 25-06-2023
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: ANANTSHEJALE
• Keywords: Unexplained cash credit
• Section: 147; 68; 143(3)

Judgement Text

P a g e | 1 ITA No.2301/Mum/2023 DCIT, CC-2(1) Vs. Mr. Bhupesh Harishchandra Rathod IN THE INCOME TAX APPELLATE TRIBUNAL “SMC” BENCH, MUMBAI BEFORE SHRI KULDIP SINGH, JUDICIAL MEMBER & SHRI AMARJIT SINGH, ACCOUNTANT MEMBER ITA No.2301/Mum/2023 (A.Y. 2011-12) Dy. Commissioner of Income-tax, Central Circle-2(1), Old CGO Building, 804, 8 th Floor, M.K. Road, Mumbai – 400020 Vs. Mr. BhupeshHarishchandraRathod, Flat No. 1, A Wing, Labh Niwas, 4 th Khetwadi, Khetwadi, Mumbai – 400004 स्थायी लेखा सं./जीआइआर सं./PAN/GIR No: AACPR3785K Appellant .. Respondent [ Appellant by : Ajeya Kumar Ojha Respondent by : AnantShejale Date of Hearing 18.10.2023 Date of Pronouncement 23.10.2023 आदेश / O R D E R Per Amarjit Singh (AM): This appeal filed by the revenue is directed against the order passed by the ld. CIT(A)-48, Mumbai dated 25.04.2023 for A.Y. 2011- 12. The revenue has raised the following grounds before us: “Whether on the facts and circumstances of the case and in law, the ld. CIT(A) erred in allowing the appeal of the assessee without going into the merits on additions as it was evident that assessee had taken accommodation entry in the form of penalty stock.” 2. Fact in brief is that assesse filed return of income on 14.7.2011 and declared total income of Rs.880,080/-. Subsequently, the assessing officer received information from the DDIT, Thane, that assessee has P a g e | 2 ITA No.2301/Mum/2023 DCIT, CC-2(1) Vs. Mr. Bhupesh Harishchandra Rathod traded in the penny stock scripts of M/s KCL Infra Project Ltd.(KCLIPL) of RS.568, 331/- to the tune of Rs.255,695/-. On the basis of information the case was reopened u/s 147 of the Act. The assessing office passed order u/s 143(3) r.w.s 147 of the Act on 22.12.2018 by making addition of Rs.184,895/- (comprising total loss of Rs.114,555/- and total profit of Rs.70,340/-) to the total income of the assesse u/s 68 of the Act. 3. The assesse filed the appeal before the ld. CIT(A). The ld. CIT(A) has partly allowed the appeal of the assesse by directing the assessing officer to verify all the detail in respect of trading in penny stock script traded by the assessee for the financial year 2010-11 and calculate net profit/loss derived by the assesse from the same. The AO was directed to restrict the addition to the extent of net profit/loss derived by the assessee only. 4. Heard the ld. D.R and perused the material on record. During the course of assessment the assessing officer observed that assessee has booked both loss/profit by trading in penny stock script as under: Loss booked by assessee from penny stock Sr. No. Scrip Name Loss (in Rs.) 1. Comfort Intech 105115 2. KCL Infra Projects 7880 3. SVC Resources 1560 Total 114555 Profit booked by assessse from penny stock Sr. No. Scrip Name Profit (in Rs.) 1. Comfort Intech 63765 2. KCL Infra Project 6575 Total profit 70340 Therefore, the assessing officer added both the total loss of Rs.114,555/- and total profit of Rs.70,340/- amounting to P a g e | 3 ITA No.2301/Mum/2023 DCIT, CC-2(1) Vs. Mr. Bhupesh Harishchandra Rathod Rs.184,895/- as unexplained cash credit u/s 68 to the total income of the assesee. In view of the facts as discussed in the findings of the ld. CIT(A) we find that AO has incorrectly made addition u/s 68 of the Act in respect of both profit and loss booked by the assessee in trading the scripts as discussed above in this order. We consider that ld. CIT(A) has rightly held that only the net profit/loss derived by the assessee from the same is required to be added to the total income of the assessee. Therefore, we don’t find any reason to interfere in the finding of ld. CIT(A). Accordingly, all the ground of appeal of revenue are dismissed. 5. In the result, the appeal of the revenue is stand dismissed. Order pronounced in the open court on 23.10.2023 Sd/- Sd/- (Kuldip Singh) (Amarjit Singh) Judicial Member Accountant Member Place: Mumbai Date 23.10.2023 Rohit: PS आदेश की प्रतितिति अग्रेतिि/Copy of the Order forwarded to : 1. अपीलाथी / The Appellant 2. प्रत्यथी / The Respondent. 3. आयकर आयुक्त / CIT 4. विभागीय प्रविवनवध, आयकर अपीलीय अवधकरण DR, ITAT, Mumbai 5. गार्ड फाईल / Guard file. सत्यावपि प्रवि //True Copy// आदेशानुसार/ BY ORDER, उि/सहायक िंजीकार (Dy./Asstt. Registrar) आयकर अिीिीय अतिकरण/ ITAT, Bench, Mumbai.