Keshav Dudhani, Kolkata V. ITO, Ward - 35(3), Kolkata , Kolkata

ITA 2349/KOL/2017

• Counselvise Citation: [2018] 119 COUNSELVISE.COM (IT) 0171 (ITAT-KOLKATA)
• Duration Of Justice: 1 year(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-12-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2014-2015
• Appeal Filed On: 20-11-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: NICHOLAS MURMA

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA SMC BENCH, KOLKATA [BEFORE SRI J. SUDHAKAR REDDY, ACCOUNTANT MEMBER] I.T.A. NO. 2349/KOL/2017 ASSESSMENT YEAR: 2014-15 KESHAV DUDHANI........APPELLANT C/O SUBASH AGARWAL & ASSOCIATES SIDDHA GIBSON 1 GIBSON LANE 2 ND FLOOR SUITE-213 KOLKATA 700 069 [PAN : AZYPD 5367 L] INCOME TAX OFFICER, WARD-35(3), KOLKATA........RESPONDENT APPEARANCES BY: SHRI SUBASH AGARWAL, ADVOCATE, APPEARED ON BEHALF OF THE ASSESSEE. SHRI NICHOLAS MURMA, JCIT, D/R, APPEARING ON BEHALF OF THE REVENUE. DATE OF CONCLUDING THE HEARING : NOVEMBER 27 TH , 2018 DATE OF PRONOUNCING THE ORDER : DECEMBER 5 TH , 2018 O R D E R PER J. SUDHAKAR REDDY :- THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE LD. COMMISSIONER OF INCOME TAX (APPEALS)-10, KOLKATA (HEREINAFTER THE LD. CIT (A)), PASSED U/S 250 OF THE INCOME TAX ACT, 1961 (THE ACT), DT. 31/08/2017, FOR THE ASSESSMENT YEAR 2014-15. 2. THE SOLE ISSUE THAT ARISES FOR MY ADJUDICATION IS WHETHER THE ASSESSING OFFICER WAS RIGHT IN REJECTING THE CLAIM OF THE ASSESSEE THAT HE HAD EARNED LONG TERM CAPITAL GAINS ON PURCHASE AND SALE OF THE SHARES OF M/S. KAILASH AUTO FINANCE LTD. THE AO BASED ON A GENERAL REPORT AND MODUS OPERANDI ADOPTED GENERALLY IN THESE CASES AND ON GENERAL OBSERVATIONS HAS CONCLUDED THAT THE ASSESSEE HAS CLAIMED BOGUS LONG TERM CAPITAL GAIN. HE MADE AN ADDITION OF THE ENTIRE SALE PROCEEDS OF THE SHARES AS INCOME AND REJECTED THE CLAIM OF EXEMPTION MADE U/S 10(38) OF THE ACT. THE EVIDENCE PRODUCED BY THE ASSESSEE IN SUPPORT OF THE GENUINENESS OF THE TRANSACTION WAS REJECTED. 2 I.T.A. NO. 2349/KOL/2017 ASSESSMENT YEAR: 2014-15 KESHAV DUDHANI 3. THE ASSESSEE CARRIED THE MATTER IN APPEAL AND THE LD. CIT(A), KOLKATA, HAD UPHELD THE ADDITION. THE LD. CIT(A) HAS IN HIS ORDER RELIED 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 THE 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 INVESTIGATION, 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 BASIS 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. I FIND THAT, IN A NUMBER OF CASES, THE JURISDICTIONAL HIGH COURT AS WELL AS THIS BENCH OF THE TRIBUNAL HAS CONSISTENTLY HELD THAT THE DECISION IN ALL SUCH CASES SHOULD BE BASED ON EVIDENCE AND NOT ON GENERALISATION, HUMAN PROBABILITIES, SUSPICION, CONJECTURES AND SURMISES. THE BENCHES HAVE IN ALL CASES DELETED SUCH ADDITIONS. SOME OF THE CASES WHERE DETAILED FINDINGS ARE GIVEN ON THIS ISSUE ARE LISTED BELOW :- SL.NO ITA NOS. NAME OF THE ASSESSEE DATE OF ORDER /JUDGMENT 1. 1236-1237/K/17 ITAT - KOLKATA MANISH KUMAR BAID & OTHERS VS ACIT 18.08.2017 2 443/KOL/2017 KIRAN KOTHARI (HUF) VS ITO 15.11.2017 3. 22 OF 2009 CALCUTTA HIGH COURT CIT, KOLKATA-III VS BHAGWATI PRASAD AGARWAL 29.04.2009 4. 456 IF 2007 BOMBAY HIGH COURT CIT VS SHRI MUKHESH RATILAL MAROLIA 07.09.2011 5. 18 OF 2017 PUNJAB AND HARYANA HIGH COURT PR. C.I.T. (CENTRAL)LUDHIANA VS SH.HITESH GANDHI, 16.02.2017 6. 95 OF 2017 PR. C.I.T. VS PREM PAL GANDHI 18.01.2018. 3 I.T.A. NO. 2349/KOL/2017 ASSESSMENT YEAR: 2014-15 KESHAV DUDHANI PUNJAB AND HARYANA HIGH COURT 7. 2281/KOL/2017 ITAT - KOLKATA NAVNEET AGARWAL, LEGAL HEIR OF LATE KIRAN AGARWAL VS ITO,WARD- 35(3),CALCUTTA 20.07.2018 5. I AM BOUND BY THE PROPOSITION OF LAW LAID DOWN IN THESE CASE LAW. THEY ARE SQUARELY APPLICABLE TO THE FACTS OF THIS CASE. THE LD. DEPARTMENTAL REPRESENTATIVE, THOUGH NOT LEAVING HIS GROUND, COULD NOT CONTROVERT THE CLAIM OF THE LD. COUNSEL FOR THE ASSESSEE THAT THE ISSUE IN QUESTION IS COVERED BY THE ABOVE CITED DECISIONS OF THE HONBLE HIGH COURTS AND THAT OF THE ITAT. 6. IN VIEW OF THE ABOVE DISCUSSION THE ADDITION IN QUESTION IS DELETED. 7. IN THE RESULT APPEAL OF THE ASSESSEE IS ALLOWED. KOLKATA, THE 5 TH DAY OF DECEMBER, 2018. SD/- [ J. SUDHAKAR REDDY ] ACCOUNTANT MEMBER DATED :05.12.2018 {SC SPS} 4 I.T.A. NO. 2349/KOL/2017 ASSESSMENT YEAR: 2014-15 KESHAV DUDHANI COPY OF THE ORDER FORWARDED TO: 1. KESHAV DUDHANI C/O SUBASH AGARWAL & ASSOCIATES SIDDHA GIBSON 1 GIBSON LANE 2 ND FLOOR SUITE-213 KOLKATA 700 069 2. INCOME TAX OFFICER, WARD-35(3), KOLKATA 3. CIT(A)- 4. CIT- , 5. CIT(DR), KOLKATA BENCHES, KOLKATA. TRUE COPY BY ORDER ASSISTANT REGISTRAR ITAT, KOLKATA BENCHES