Nikhil Pansari , Howrah V. ITO, Ward - 48(2) , Kolkata

ITA 2387/KOL/2018

• Counselvise Citation: [2019] 116 COUNSELVISE.COM (IT) 4044 (ITAT-KOLKATA)
• Duration Of Justice: 9 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-08-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 02-07-2019
• Assessment Year: 2015-2016
• Appeal Filed On: 16-11-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SANKAR HALDER
• Keywords: Unexplained cash credit; Business income; Share purchase agreement; Principle of natural justice; Opportunity of cross examination; Earning of tax free income; Question of law; Third party statement; Accommodation entries; Sham transactions; TDS; Set aside; Capital Gains; Bogus
• Section: 147; 68; 6; 271(1)(c); 143(3); 205; 13; 22; 20

Judgement Text

1 ITA NO.2387/KOL/2018 NIKHIL PANSARI, AY 2015-16 , SMC , IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH: K OLKATA ( ) . . , ) [BEFORE SHRI A. T. VARKEY, JM] I.T.A. NO. 2387/KOL/2018 ASSESSMENT YEAR: 2015-16 NIKHIL PANSARI (PAN: ASYPP4962E) VS. ITO, WARD 48(2), KOLKATA APPELLANT RESPONDENT DATE OF HEARING 02.07.2019 DATE OF PRONOUNCEMENT 23.08.2019 FOR THE APPELLANT SHRI AKKAL DUDHWEWALA, ADVOCATE FOR THE RESPONDENT SHRI SANKAR HALDER, JCIT, SR. D R ORDER PER SHRI A.T.VARKEY, JM THIS IS APPEAL PREFERRED BY THE ASSESSEE AGAINST TH E ORDER OF LD. CIT(A) 14, KOLKATA DATED 28.09.2018 FOR ASSESSMENT YEAR 2015-16. 2. THE ASSESSEES SOLE GROUND OF APPEAL IS AS TO WH ETHER ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LDCIT(A) WAS JUSTIFIED IN UPHOLDIN G THE ADDITION MADE BY THE AO U/S 68 OF THE ACT IN RESPECT OF SALE PROCEEDS OF SHARES OF KA ILASH AUTO FINANCE LIMITED (KAFL) TREATING THE SAME AS INCOME FROM UNDISCLOSED SOURCE S AFTER REJECTING THE ASSESSEES CLAIM OF LONG TERM CAPITAL GAINS (LTCG) ON SALE OF THOSE SHA RES. 3. THE BRIEF FACTS OF THE ISSUE AS HAS BEEN RECORDE D BY THE AO IN THE ASSESSMENT ORDER ARE THAT THE ASSESSEE CLAIMED LONG TERM CAPITAL GAI NS FROM SALE OF SHARES OF M/S. KAILASH AUTO FINANCE LIMITED (KAFL). THE AO NOTED THAT THE ASSESSEE HAD PURCHASED 12,500 SHARES OF M/S. PANHSHUL MARKETING LTD. AT A PRICE O F RS.25,000/- ON 07.03.2013. PURSUANT TO THE MERGER OF PANHSHUL MARKETING LTD. WITH KAILASH AUTO FINANCE LTD., 12,500 SHARES OF KAILASH AUTO WERE ALLOTTED TO THE APPELLANT IN THE RATIO OF 1:1. THE SAID SHARES WERE LATER SOLD AT A PRICE OF RS.5,18,881/-, WHICH ACCORDING T O ASSESSEE, RESULTED IN LONG TERM CAPITAL 2 ITA NO.2387/KOL/2018 NIKHIL PANSARI, AY 2015-16 GAINS AND SO THE ASSESSEE CLAIMED EXEMPTION U/S 10( 38) OF THE ACT OF RS.4,93,881/-. HOWEVER, THE AO RELYING ON THE REPORT OF THE INVEST IGATION WING, KOLKATA ALLEGED THAT THE CLAIM OF ASSESSEE OF EXEMPT INCOME (LTCG) WAS BOGUS IN NATURE. THE AO FURTHER ALLEGED THAT THE TRANSACTIONS IN THE SCRIP OF KAILASH AUTO FINANCE LTD. (KAFL) WERE BEING MANIPULATED BY ENTRY OPERATORS AND THE SHARE PRICES WERE HIKED ARTIFICIALLY TO EARN LTCG. SO, THE AO DID NOT ACCEPT THE ASSESSEES CLAIM OF L TCG AND EXEMPTION THEREOF CLAIMED BY THE ASSESSEE. THEREAFTER, THE AO TREATED THE SAME A S CASH CREDIT U/S 68 OF THE ACT AND ADDED THE ENTIRE LTCG TO THE INCOME OF THE ASSESSEE AS UN EXPLAINED INCOME. ON FIRST APPEAL, THE LD. CIT(A) DISMISSED THE GROUNDS RAISED BY THE ASSE SSEE AGAINST HIS CLAIM OF EXEMPTION U/S 10(38) OF THE ACT AND HE ALSO CONFIRMED THE ADDITIO NS MADE BY THE AO UNDER SECTION 68 OF THE ACT. AGGRIEVED, THE ASSESSEE IS IN APPEAL BEFOR E THIS TRIBUNAL. 4. I HAVE HEARD RIVAL SUBMISSIONS AND GONE THROUGH THE FACTS AND CIRCUMSTANCES OF THE CASE. AT THE TIME OF HEARING IT WAS BROUGHT TO MY N OTICE BY THE LD. AR THAT THIS TRIBUNAL IN THE FOLLOWING CASES HAVE DECIDED THAT THE SCRIPS OF KAFL ARE NOT BOGUS AND HELD THAT THE LTCG CLAIM OF THE ASSESSEE NEEDS TO BE ALLOWED: I) MANISH KUMAR BAIDVS. ACIT, ITA NOS. 1236& 1237/K OL/2017 DATED 18.08.2017 II) RUKMINI DEVI MANPRIA VS. DCIT, ITA NO.1724/KOL/ 2017 DATED 24.10.2018 III) JAGMOHAN AGARWAL VS. ACIT, ITA NO.604/KOL/2018 DATED 05.09.2018. 5. ON THE OTHER HAND, THE LD. DR FOR THE REVENUE V EHEMENTLY OPPOSED THE CONTENTIONS OF THE ASSESSEE AND TOOK US THROUGH THE AOS ORDER AND LD. CIT(A) ORDER AND SUBMITTED THAT SCRIPS OF M/S. KAFL WAS ARTIFICIALLY RIGGED TO PROV IDE LTCG TO THE ASSESSEE WHICH CANNOT BE ALLOWED AND SUPPORTED THE IMPUGNED ORDER AND REL IED ON THE ORDER OF HONBLE BOMBAY HIGH COURT IN THE CASE OF BINOD CHAND JAIN IN TAX A PPEAL NO.18 OF 2017 AND 23 CASE LAWS WHICH I WILL DEAL INFRA AND THEREFORE DOES NOT WANT ME TO INTERFERE 6. I NOTE THAT SIMILAR ISSUE AROSE IN MANISH KUMAR BAID, (SUPRA) WHEREIN, THE TRIBUNAL ALLOWED THE CLAIM OF ASSESSEE IN RESPECT OF LTCG FR OM SALE OF SCRIPS OF M/S. KAFL HAS HELD AS UNDER: 6. WE HAVE HEARD BOTH THE RIVAL SUBMISSIONS AND PE RUSED THE MATERIALS AVAILABLE ON RECORD. WE FIND LOT OF FORCE IN THE ARGUMENTS OF THE LD AR THAT THE LD AO WAS NOT JUSTIFIED IN REJECTING 3 ITA NO.2387/KOL/2018 NIKHIL PANSARI, AY 2015-16 THE CLAIM OF THE ASSESSEE ON THE BASIS OF THEORY OF SURROUNDING CIRCUMSTANCES, HUMAN CONDUCT, AND PREPONDERANCE OF PROBABILITY WITHOUT BRINGING O N RECORD ANY LEGAL EVIDENCE AGAINST THE ASSESSEE. WE RELY ON THE JUDGEMENT OF SPECIAL BENCH OF MUMBAI TRIBUNAL IN THE CASE OF GTC INDUSTRIES LTD. (SUPRA) FOR THIS PROPOSITION. THE V ARIOUS FACETS OF THE ARGUMENTS OF THE LD AR SUPRA, WITH REGARD TO IMPLEADING THE ASSESSEE FOR D RAWING ADVERSE INFERENCES WHICH REMAIN UNPROVED BASED ON THE EVIDENCES AVAILABLE ON RECORD , ARE NOT REITERATED FOR THE SAKE OF BREVITY. THE PRINCIPLES LAID DOWN IN VARIOUS CASE LAWS RELIE D UPON BY THE LD AR ARE ALSO NOT REITERATED FOR THE SAKE OF BREVITY. WE FIND THAT THE AMALGAMAT ION OF CPAL WITH KAFL HAS BEEN APPROVED BY THE ORDER OF HONBLE HIGH COURT. THE LD AO OUGHT NOT TO HAVE QUESTIONED THE VALIDITY OF THE AMALGAMATION SCHEME APPROVED BY THE HONBLE HIGH CO URT IN MAY 2013 MERELY BASED ON A STATEMENT GIVEN BY A THIRD PARTY WHICH HAS NOT BEEN SUBJECT TO CROSS EXAMINATION. MOROEVER, IT IS ALSO PERTINENT TO NOTE THAT THE ASSESSEE AND / O R THE STOCK BROKER ASHITA STOCK BROKING LTD NAME IS NEITHER MENTIONED IN THE SAID STATEMENT AS A PERSON WHO HAD ALLEGEDLY DEALT WITH SUSPICIOUS TRANSACTIONS NOR THEY HAD BEEN THE BENEF ICIARIES OF THE TRANSACTIONS OF SHARES OF KAFL. HENCE WE HOLD THAT THERE IS ABSOLUTELY NO ADV ERSE MATERIAL TO IMPLICATE THE ASSESSEE TO THE ENTIRE GAMUT OF UNWARRANTED ALLEGATIONS LEVELED BY THE LD AO AGAINST THE ASSESSEE, WHICH IN OUR CONSIDERED OPINION, HAS NO LEGS TO STAND IN THE EYES OF LAW. WE FIND THAT THE LD DR COULD NOT CONTROVERT THE ARGUMENTS OF THE LD AR WITH CONTRARY MATERIAL EVIDENCES ON RECORD AND MERELY RELIED ON THE ORDERS OF THE LOWER AUTHORITIES APART FROM PLACING THE COPY OF SEBIS INTERIM ORDER SUPRA. WE FIND THAT THE SEBIS ORDERS RELIED ON BY THE LD AO AND REFERRED TO HIM AS DIRECT EVIDENCE AGAINST THE ASSESSEE DID NOT CONTAIN THE N AME OF THE ASSESSEE AND/OR THE NAME OF ASHIKA STOCK BROKING LTD. THROUGH WHOM THE ASSESSEE SOLD THE SHARES OF KAFL AS A BENEFICIARY TO THE ALLEGED ACCOMMODATION ENTRIES PROVIDED BY TH E RELATED ENTITIES / PROMOTERS / BROKERS / ENTRY OPERATORS. IN THE INSTANT CASE, THE SHARES OF CPAL WERE PURCHASED BY THE ASSESSEE WAY BACK ON 20.12.2011 AND PURSUANT TO MERGER OF CPAL W ITH KAFL, THE ASSESSEE WAS ALLOTTED EQUAL NUMBER OF SHARES IN KAFL, WHICH WAS SOLD BY T HE ASSESSEE BY EXITING AT THE MOST OPPORTUNE MOMENT BY MAKING GOOD PROFITS IN RODER TO HAVE A GOOD RETURN ON HIS INVESTMENT. WE FIND THAT THE ASSESSEE AND / OR THE BROKER ASHITA S TOCK BROKING LTD WAS NOT THE PRIMARY ALLOTTEES OF SHARES EITHER IN CPAL OR IN KAFL AS COULD BE EVI DENT FROM THE SEBIS ORDER. WE FIND THAT THE SEBI ORDER DID MENTION THE LIST OF 246 BENEFICI ARIES OF PERSONS TRADING IN SHARES OF KAFL, WHEREIN, THE ASSESSEE AND / OR ASHITA STOCK BROKING LTDS NAME IS NOT REFLECTED AT ALL. HENCE THE ALLEGATION THAT THE ASSESSEE AND / OR ASHITA STOCK BROKING LTD GETTING INVOLVED IN PRICE RIGGING OF KAFL SHARES FAILS. WE ALSO FIND THAT EVEN THE SE BIS ORDER HEAVILY RELIED UPON BY THE LD AO CLEARLY STATES THAT THE COMPANY KAFL HAD PERFORMED VERY WELL DURING THE YEAR UNDER APPEAL AND THE P/E RATIO HAD INCREASED SUBSTANTIALLY. THUS WE HOLD THAT THE SAID ORDERS OF SEBI IS NO EVIDENCE AGAINST THE ASSESSEE, MUCH LESS TO SPEAK O F DIRECT EVIDENCE. THE ENQUIRY BY THE INVESTIGATION WING AND/OR THE ST ATEMENTS OF SEVERAL PERSONS RECORDED BY THE INVESTIGATION WING IN CONNECTION WITH THE ALLEG ED BOGUS TRANSACTIONS IN THE SHARES OF KAFL ALSO DID NOT IMPLICATE THE ASSESSEE AND/OR HIS BROKER. IT IS ALSO A MATTER OF RECORD THAT THE ASSESSEE FURNISHED ALL EVIDENCES IN THE FORM OF BILLS, CONTRACT NOTES,DEMAT STATEMENTS AND THE BANK ACCOUNTS TO PROVE THE GENUINENESS OF THE T RANSACTIONS RELATING TO PURCHASE AND SALE OF SHARES RESULTING IN LTCG. THESE EVIDENCES WERE N EITHER FOUND BY THE LD AO TO BE FALSE OR FABRICATED. THE FACTS OF THE CASE AND THE EVIDENCES IN SUPPORT OF THE ASSESSEES CASE CLEARLY SUPPORT THE CLAIM OF THE ASSESSEE THAT THE TRANSACT IONS OF THE ASSESSEE WERE BONAFIDE AND GENUINE AND THEREFORE THE LD AO WAS NOT JUSTIFIED I N REJECTING THE ASSESSEES CLAIM OF EXEMPTION UNDER SECTION 10(38) OF THE ACT. WE ALSO FIND THAT THE VARIOUS CASE LAWS OF HONBLE 4 ITA NO.2387/KOL/2018 NIKHIL PANSARI, AY 2015-16 JURISDICTIONAL HIGH COURT RELIED UPON BY THE LD AR AND FINDINGS GIVEN THEREON WOULD APPLY TO THE FACTS OF THE INSTANT CASE. THE LD DR WAS NOT AB LE TO FURNISH ANY CONTRARY CASES TO THIS EFFECT. HENCE WE HOLD THAT THE LD AO WAS NOT JUSTIF IED IN ASSESSING THE SALE PROCEEDS OF SHARES OF KAFL AS UNDISCLOSED INCOME OF THE ASSESSEE U/S 6 8 OF THE ACT. WE ACCORDINGLY HOLD THAT THE REFRAMED QUESTION NO. 1 RAISED HEREINABOVE IS DECID ED IN THE NEGATIVE AND IN FAVOUR OF THE ASSESSEE. 7. COMING BACK TO THE INSTANT CASE, IT IS NOTED BY ME THAT THE ASSESSEE HAD PURCHASED 12,500 SHARES @ RS.2/- EACH OF M/S. PANCH SHUL MARKETING LTD. ON 07.03.2013 (MERGED WITH M/S. KAILASH AUTO FINANCE L TD. [HEREINAFTER M/S. KAFL] ON09.05.2013) FOR A CONSIDERATION OF RS.25,000/- FR OM M/S. SHIV SHAKTI EXPORTS PVT. LTD. IN AN OFF MARKET TRANSACTION. IT IS CLARIFIED THAT OFF MARKET TRANSACTION HAS NOT BEEN PROHIBITED AND IF CARRIED OUT LEGALLY CANNOT BE HEL D TO BE BOGUS ONLY ON THIS COUNT. IT IS FURTHER NOTED THAT THE SAID SHARES WERE LATER SOLD AT A PRICE OF RS.5,18,881/- IN THE STOCK EXCHANGE OF BOMBAY, WHICH ACCORDING TO ASSESSEE, RE SULTED IN LONG TERM CAPITAL GAINS AFTER REMITTING STT AND SO THE ASSESSEE CLAIM ED EXEMPTION U/S 10(38) OF THE ACT OF RS.4,93,881/-. IT IS NOTED THAT THE ASSESSEE HAS PAID THE AMOUNT OF RS.25,000/- THROUGH ACCOUNT PAYEE CHEQUE TO M/S. SHIVSHAKTI EXP ORTS PVT. LTD (PURCHASE BILL AVAILABLE AT PAPER BOOK PAGES 17 AND COPY OF BANK S TATEMENT SHOWING PAYMENTS MADE FOR PURCHASE OF SHARES FOUND PLACED AT PAGES 25 OF PAPER BOOK). THE AFORESAID 25,000 SHARES OF M/S. PANCHSHUL MARKETING LTD. WERE RECEIV ED IN THE DEMAT (PAGE 18 OF PAPER BOOK). THE SAID COMPANY (M/S. PANCHSHUL MARKE TING LTD.) WAS LATER MERGED WITH M/S. KAILASH AUTO FINANCE LTD. AS PER THE ORDE R OF THE HONBLE HIGH COURT OF ALLAHABAD DATED 09.05.2013 AND CONSEQUENT TO MERGER , THE ASSESSEE HAD RECEIVED 25,000 SHARES OF M/S. KAFL. THE ASSESSEE SOLD THE S AID SHARES DURING THE PREVIOUS YEAR RELEVANT TO ASSESSMENT YEAR UNDER CONSIDERATIO N AND SUCH SALE WAS MADE IN THE BOMBAY STOCK EXCHANGE THROUGH M/S. FORTUNE INTERFIN ANCE LTD., A REGISTERED SHARE AND STOCK BROKER (CONTRACT NOTE PLACED AT PAGES 23- 24 OF PAPER BOOK) AFTER DULY PAYING THE SECURITY TRANSACTION TAX (STT). THE SALE CONSID ERATION THE ASSESSEE RECEIVED BY ACCOUNT PAYEE CHEQUE IN ITS DCB BANK ACCOUNT WHICH IS EVIDENT FROM THE BANK STATEMENT FILED BEFORE US AT PAGE 26-27 OF THE PAPE R BOOK. THEREFORE, THE LONG TERM CAPITAL EARNED IN THE PROCESS HAS BEEN CLAIMED AS E XEMPT INCOME UNDER SECTION 10(38) OF THE ACT. I ALSO NOTE THAT IN SUPPORT OF THE ASSE SSEES CONTENTION VARIOUS DOCUMENTS 5 ITA NO.2387/KOL/2018 NIKHIL PANSARI, AY 2015-16 HAD BEEN FILED DURING THE COURSE OF ASSESSMENT PROC EEDINGS I.E. COPIES OF PURCHASE BILLS, WHICH IS AVAILABLE IN PAPER BOOK PAGE 17, CO PY OF BANK STATEMENTS SHOWING PAYMENTS MADE FOR PURCHASE OF SHARES, WHICH IS AVAI LABLE IN PAPER BOOK PAGES 25, DEMAT ACCOUNT WITH EAST INDIA SECURITIES LIMITED, C OPIES OF CONTRACT NOTES IN RESPECT OF SALE OF SHARES, WHICH IS AVAILABLE AT PAGES 23-24 O F PAPER BOOK, COPY OF BANK STATEMENTS SHOWING RECEIPTS AGAINST SALE OF SHARES, WHICH IS AVAILABLE AT PAGE 26-27 OF THE PAPER. 8. I NOTE THAT SHARES OF M/S. KAFL WERE SOLD BY ASS ESSEE THROUGH RECOGNIZED BROKER IN A RECOGNIZED STOCK EXCHANGE. THE DETAILS OF SUCH SALE AND CONTRACT NOTE HAVE BEEN SUBMITTED BEFORE AO/LD. CIT(A). I TAKE NOTE TH AT WHEN THE TRANSACTIONS HAPPENED IN THE STOCK EXCHANGE, THE SELLER WHO SELL S HIS SHARES ON THE STOCK EXCHANGE DOES NOT KNOW WHO PURCHASES SHARES. IT IS NOTED THA T THE SHARES ARE SOLD AND BOUGHT IN AN ELECTRONIC MODE ON THE COMPUTERS ON-LINE BY THE BROKERS AND THERE IS ALSO NO DIRECT CONTACT AT ANY LEVEL EVEN BETWEEN THE BROKERS. IT I S NOTED THAT AS AND WHEN ANY SHARES ARE OFFERED FOR SALE IN THE STOCK EXCHANGE PLATFORM , ANY ONE OF THE THOUSANDS OF BROKERS REGISTERED WITH THE STOCK EXCHANGE IS AT LI BERTY TO PURCHASE IT. AS FAR AS OUR UNDERSTANDING THE SELLING BROKER DOES NOT EVEN KNOW WHO IS THE PURCHASING BROKER. THIS IS HOW THE SEBI KEEPS A STRICT CONTROL OVER TH E TRANSACTIONS TAKEN PLACE IN RECOGNIZED STOCK EXCHANGES. UNLESS THERE IS A EVIDE NCE TO SHOW THAT THERE IS A BREACH IN THE AFORESAID PROCESS WHICH FACT HAS BEEN UNEART HED BY METICULOUS INVESTIGATION, I AM OF THE OPINION THAT THE UNSCRUPULOUS ACTIONS OF FEW PLAYERS EXPLOITING THE LOOPHOLES OF THE STOCK EXCHANGE, IF ANY, CANNOT BE THE BASIS TO PAINT THE ENTIRE SALE/PURCHASE OF A SCRIP LIKE THAT OF M/S. KAFL AS BOGUS WITHOUT BRING ING OUT ADVERSE MATERIAL SPECIFICALLY AGAINST THE ASSESSEE. 9. THE LD. CIT(A) IN HIS ORDER HAS OBSERVED THAT TH E APPELLANT WAS UNABLE TO SUFFICIENTLY PROVE THAT THE SHARES WERE HELD IN DEM AT FORM. THIS FINDING HOWEVER APPEARS TO BE ERRONEOUS. I NOTE THAT THE APPELLANT HAD FURNISHED THE DEMAT HOLDING STATEMENT FOR THE YEAR 2013 EVIDENCING THAT THE APP ELLANT HELD 12,500 SHARES OF PANCHSHUL MARKETING PVT LTD, WHICH IS AVAILABLE AT PAGE 18 OF THE PAPER BOOK. 6 ITA NO.2387/KOL/2018 NIKHIL PANSARI, AY 2015-16 SIMILARLY AT PAGES 19 TO 21 OF THE PAPER BOOK, THE APPELLANT HAS ENCLOSED COPIES OF THE DEMAT STATEMENTS REFLECTING THE ALLOTMENT OF SHARES OF KAFL UPON GIVING EFFECT TO SCHEME OF ARRANGEMENT BETWEEN KAFL AND PANCHSHUL MA RKETING PVT LTD AND THE SUBSEQUENT TRANSFER OUT OF SHARES OF KAFL IN THE MO NTH OF SALE I.E. APRIL 2014. HENCE THE FACT OF HOLDING THE SHARES IN THE DEMAT ACCOUNT CANNOT BE DISPUTED. THEREFORE, ONCE, THE HOLDING OF SHARES IS DEMAT ACCOUNT STANDS PROVED, THEN THE TRANSACTION CANNOT BE HELD AS BOGUS. THE AO HAS NOT DISPUTED TH E SALE OF SHARES FROM THE D-MAT ACCOUNT OF THE ASSESSEE AND THE SALE CONSIDERATION WAS DIRECTLY CREDITED TO THE BANK ACCOUNT OF THE ASSESSEE, THEREFORE, ONCE THE ASSESS EE PRODUCED ALL RELEVANT EVIDENCE TO SUBSTANTIATE THE TRANSACTION OF PURCHASE, DEMATERIA LIZATION AND SALE OF SHARES THEN, IN THE ABSENCE OF ANY CONTRARY MATERIAL BROUGHT ON REC ORD THE SAME CANNOT BE HELD AS BOGUS TRANSACTION MERELY ON THE BASIS OF REPORT OF INVESTIGATION WING, KOLKATA WHEREIN THERE IS A GENERAL STATEMENT OF PROVIDING B OGUS LONG TERM CAPITAL GAIN TRANSACTION TO THE CLIENTS WITHOUT STATING ANYTHING ABOUT THE TRANSACTION OF ALLOTMENT OF SHARES BY THE COMPANY TO THE ASSESSEE. 10. THE MUMBAI SPECIAL BENCH OF THE TRIBUNAL IN CA SE OF GTC INDUSTRIES VS. ACIT (SUPRA) HAD THE OCCASION TO CONSIDER THE ADDITION M ADE BY THE AO ON THE BASIS OF SUSPICION AND SURMISES AND OBSERVED IN PAR 46 AS UN DER:- 46. IN SITUATIONS LIKE THIS CASE, ONE MAY FALL INT O REALM OF 'PREPONDERANCE OF PROBABILITY' WHERE THERE ARE MANY PROBABLE FACTORS, SOME IN FAVOUR OF THE ASSESSEE AND SOME MAY GO AGAINST THE ASSESSEE. BUT THE PROBABLE FACTORS HAVE TO BE WEIGHED ON MATERIAL FACTS SOCOLLECTED. HERE IN THIS CASE THE M ATERIAL FACTS STRONGLY INDICATE A PROBABILITY THAT THE WHOLESALE BUYERS HAD COLLECTED THE PREMIUM MONEY FOR SPENDING IT ON ADVERTISEMENT AND OTHER EXPENSES AND IT WAS THEI R LIABILITY AS PER THEIR MUTUAL UNDERSTANDING WITH THE ASSESSEE. ANOTHER VERY STRON G PROBABLE FACTOR IS THAT THE ENTIRE SCHEME OF 'TWIN BRANDING' AND COLLECTION OF PREMIUM WAS SO DESIGNED THAT ASSESSEE COMPANY NEED NOT INCUR ADVERTISEMENT EXPENSES AND T HE RESPONSIBILITY FOR SALES PROMOTION AND ADVERTISEMENT LIES WHOLLY UPON WHOLES ALE BUYERS WHO WILL BORNE OUT THESE EXPENSES FROM ALLEGED COLLECTION OF PREMIUM. THE PROBABLE FACTORS COULD HAVE GONE AGAINST THE ASSESSEE ONLY IF THERE WOULD HAVE BEEN SOME EVIDENCE FOUND FROM SEVERAL SEARCHES EITHER CONDUCTED BY DRI OR BY THE DEPARTMENT THAT ASSESSEECOMPANY WAS BENEFICIARY OF ANY SUCH ACCOUNTS. AT LEAST SOME THING WOULD HAVE BEEN UNEARTHED FROM SUCH GLOBAL LEVEL INVESTIGATION BY TWO CENTRAL GOVERNMENT AUTHORITIES. IN CASE OF CERTAIN DONATIONS GIVEN TO A CHURCH, ORIGINATING TH ROUGH THESE BENAMI BANK ACCOUNTS ON THE BEHEST OF ONE OF THE EMPLOYEES OF THE ASSESS EE COMPANY, DOES NOT IMPLICATE THAT GTC AS A CORPORATE ENTITY WAS HAVING THE CONTROL OF THESE BANK ACCOUNTS COMPLETELY. WITHOUT GOING INTO THE AUTHENTICITY AND VERACITY OF THE STATEMENTS OF THE WITNESSES SMT. NIRMALA SUNDARAM, WE ARE OF THE OPINION THAT THIS O NE INCIDENT OF DONATION THROUGH 7 ITA NO.2387/KOL/2018 NIKHIL PANSARI, AY 2015-16 BANK ACCOUNTS AT THE DIRECTION OF ONE OF THE EMPLOY EE OF THE COMPANY DOES NOT IMPLICATE THAT THE ENTIRE PREMIUM COLLECTED ALL THR OUGHOUT THE COUNTRY AND DEPOSITED IN BENAMI BANK ACCOUNTS ACTUALLY BELONGS TO THE ASSESS EE-COMPANY OR THE ASSESSEE- COMPANY HAD DIRECT CONTROL ON THESE BANK ACCOUNTS. ULTIMATELY, THE ENTIRE CASE OF THE REVENUE HINGES UPON THE PRESUMPTION THAT ASSESSEE I S BOUND TO HAVE SOME LARGE SHARE IN SO-CALLED SECRET MONEY IN THE FORM OF PREMIUM AN D ITS CIRCULATION. HOWEVER, THIS PRESUMPTION OR SUSPICION HOW STRONG IT MAY APPEAR T O BE TRUE, BUT NEEDS TO BE CORROBORATED BY SOME EVIDENCE TO ESTABLISH A LINK T HAT GTC ACTUALLY HAD SOME KIND OF A SHARE IN SUCH SECRET MONEY. IT IS QUITE A TRITE LAW THAT SUSPICION HOWSOEVER STRONG MAY BE BUT CANNOT BE THE BASIS OF ADDITION EXCEPT FOR S OME MATERIAL EVIDENCE ON RECORD. THE THEORY OF 'PREPONDERANCE OF PROBABILITY' IS APPLIED TO WEIGH THE EVIDENCES OF EITHER SIDE AND DRAW A CONCLUSION IN FAVOUR OF A PARTY WHICH HA S MORE FAVOURABLE FACTORS IN HIS SIDE. THE CONCLUSIONS HAVE TO BE DRAWN ON THE BASIS OF CERTAIN ADMITTED FACTS AND MATERIALS AND NOT ON THE BASIS OF PRESUMPTION OF FA CTS THAT MIGHT GO AGAINST ASSESSEE. ONCE NOTHING HAS BEEN PROVED AGAINST THE ASSESSEE W ITH AID OF ANY DIRECT MATERIAL ESPECIALLY WHEN VARIOUS ROUNDS OF INVESTIGATION HAV E BEEN CARRIED OUT, THEN NOTHING CAN BE IMPLICATED AGAINST THE ASSESSEE.' 11. THEREFORE, WHEN THE ASSESSING OFFICER HAS NOT BROUGHT ANY MATERIAL ON RECORD TO SHOW THAT THE ASSESSEE HAS PAID OVER AND ABOVE THE PURCHASE CONSIDERATION AS CLAIMED AND EVIDENT FROM THE BANK ACCOUNT, THEN IN THE ABSENCE OF ANY EVIDENCE IT CANNOT BE HELD THAT THE ASSESSEE HAS INTRODUCED HIS OWN UNACCOUNTED MONEY B Y WAY OF BOGUS LONG TERM CAPITAL GAIN. THE HON'BLE RAJASTHAN HIGH COURT IN CASE OF C IT VS. SMT. POOJA AGRAWAL (SUPRA) HAS UPHELD THE FINDING OF THE TRIBUNAL ON THIS ISSUE IN PARA 12 AS UNDER:- '12. HOWEVER, COUNSEL FOR THE RESPONDENT HAS TAKEN US TO THE ORDER OF CIT(A) AND ALSO TO THE ORDER OF TRIBUNAL AND CONTENDED THAT IN VIEW OF THE FINDING REACHED, WHICH WAS DONE THROUGH STOCK EXCHANGE AND TAKING INTO CONSIDE RATION THE REVENUE TRANSACTIONS, THE ADDITION MADE WAS DELETED BY THE TRIBUNAL OBSER VING AS UNDER:- 'CONTENTION OF THE AR IS CONSIDERED. ONE OF THE MAI N REASONS FOR NOT ACCEPTING THE GENUINENESS OF THE TRANSACTIONS DECLARED BY THE APP ELLANT THAT AT THE TIME OF SURVEY THE APPELLANT IN HIS STATEMENT DENIED HAVING MADE ANY T RANSACTIONS IN SHARES. HOWEVER, SUBSEQUENTLY THE FACTS CAME ON RECORD THAT THE APPE LLANT HAD TRANSACTED NOT ONLY IN THE SHARES WHICH ARE DISPUTED BUT SHARES OF VARIOUS OTH ER COMPANIES LIKE SATYAM COMPUTERS, HCL, IPCL, BPCL AND TATA TEA ETC. REGARD ING THE TRANSACTIONS IN QUESTION VARIOUS DETAILS LIKE COPY OF CONTRACT NOTE REGARDING PURCHASE AND SALE OF SHARES OF LIMTEX AND KONARK COMMERCE & IND. LTD., A SSESSEE'S ACCOUNT WITH P.K. AGARWAL & CO. SHARE BROKER, COMPANY'S MASTER DETAIL S FROM REGISTRAR OF COMPANIES, KOLKATA WERE FILED. COPY OF DEPOSITORY A/C OR DEMAT ACCOUNT WITH ALANKRIT ASSIGNMENT LTD., A SUBSIDIARY OF NSDL WAS ALSO FILED WHICH SHO WS THAT THE TRANSACTIONS WERE MADE THROUGH DEMAT A/C. WHEN THE RELEVANT DOCUMENTS ARE AVAILABLE THE FACT OF TRANSACTIONS ENTERED INTO CANNOT BE DENIED SIMPLY ON THE GROUND THAT IN HIS STATEMENT THE APPELLANT DENIED HAVING MADE ANY TRANSACTIONS IN SHARES. THE PAYMENTS AND RECEIPTS ARE MADE THROUGH A/C PAYEE CHEQUES AND THE TRANSACTIONS ARE ROUTED THROUGH KOLKATA STOCK EXCHANGE. THERE IS NO EVIDENCE THAT THE CASH HAS GO NE BACK IN APPELLANTS'S ACCOUNT. PRIMA FACIE THE TRANSACTION WHICH ARE SUPPORTED BY DOCUMENTS APPEAR TO BE GENUINE TRANSACTIONS. THE AO HAS DISCUSSED MODUS OPERANDI I N SOME SHAM TRANSACTIONS WHICH WERE DETECTED IN THE SEARCH CASE OF B.C. PUROHIT GR OUP. THE AO HAS ALSO STATED IN THE ASSESSMENT ORDER ITSELF WHILE DISCUSSING THE MODUS OPERANDI THAT ACCOMMODATION ENTRIES OF LONG TERM CAPITAL GAIN WERE PURCHASED AS LONG TERM CAPITAL GAIN EITHER WAS 8 ITA NO.2387/KOL/2018 NIKHIL PANSARI, AY 2015-16 EXEMPTED FROM TAX OR WAS TAXABLE AT A LOWER RATE. A S THE APPELLANT'S CASE IS OF SHORT TERM CAPITAL GAIN, IT DOES NOT EXACTLY FALL UNDER T HAT CATEGORY OF ACCOMMODATION TRANSACTIONS. FURTHER AS PER THE REPORT OF DCIT, CE NTRAL CIRCLE-3 SH. P.K. AGARWAL WAS FOUND TO BE AN ENTRY PROVIDER AS STATED BY SH. PAWA NPUROHIT OF B.C. PURIHIT AND CO. GROUP. THE AR MADE SUBMISSION BEFORE THE AO THAT TH E FACT WAS NOT CORRECT AS IN THE STATEMENT OF SH. PAWANPUROHIT THERE IS NO MENTION O F SH. P. K. AGARWAL. IT WAS ALSO SUBMITTED THAT THERE WAS NO MENTION OF SH. P. K. AG ARWAL IN THE ORDER OF SETTLEMENT COMMISSION IN THE CASE OF SH. SUSHIL KUMAR PUROHIT. COPY OF THE ORDER OF SETTLEMENT COMMISSION WAS SUBMITTED. THE AO HAS FAILED TO COUN TER THE OBJECTIONS RAISED BY THE APPELLANT DURING THE ASSESSMENT PROCEEDINGS. SIMPLY MENTIONING THAT THESE FINDINGS ARE IN THE APPRAISAL REPORT AND APPRAISAL REPORT IS MAD E BY THE INVESTING WING AFTER CONSIDERING ALL THE MATERIAL FACTS AVAILABLE ON REC ORD DOES NOT HELP MUCH. THE AO HAS FAILED TO PROVE THROUGH ANY INDEPENDENT INQUIRY OR RELYING ON SOME MATERIAL THAT THE TRANSACTIONS MADE BY THE APPELLANT THROUGH SHARE BR OKER P.K. AGARWAL WERE NON- GENUINE OR THERE WAS ANY ADVERSE MENTION ABOUT THE TRANSACTION IN QUESTION IN STATEMENT OF SH. PAWANPUROHIT. SIMPLY BECAUSE IN TH E SHAM TRANSACTIONS BANK A/C WERE OPENED WITH HDFC BANK AND THE APPELLANT HAS ALSO RE CEIVED SHORT TERM CAPITAL GAIN IN HIS ACCOUNT WITH HDFC BANK DOES NOT ESTABLISH THAT THE TRANSACTION MADE BY THE APPELLANT WERE NON GENUINE. CONSIDERING ALL THESE F ACTS THE SHARE TRANSACTIONS MADE THROUGH SHRI P.K. AGARWAL CANNOT BE HELD AS NON-GEN UINE. CONSEQUENTLY DENYING THE CLAIM OF SHORT TERM CAPITAL GAIN (6 OF 6) [ ITA-385 /2011] MADE BY THE APPELLANT BEFORE THE AO IS NOT APPROVED. THE AO IS THEREFORE, DIRECT ED TO ACCEPT CLAIM OF SHORT TERM CAPITAL GAIN AS SHOWN BY THE APPELLANT.' 12. I NOTE THAT THE SALE OF SHARES OF M/S. KAFL WH ICH WAS DEMATERLIZED IN DEMAT ACCOUNT HAS TAKEN PLACE THROUGH RECOGNISED STOCK EX CHANGE AND ASSESSEE RECEIVED MONEY THROUGH BANKING CHANNEL. SO, ASSESSEE HAS EXPLAINED THE NATURE AND SOURCE OF THE MONEY WITH SUPPORTING DOCUMENTS AND THUS HAS DISCHARGED T HE ONUS CASTED UPON HIM BY PRODUCING THE RELEVANT DOCUMENTS MENTIONED IN PARA 7 (SUPRA), ACCORDINGLY, THE QUESTION OF TREATING THE SAID GAIN AS UNEXPLAINED CASH CREDIT UNDER SECTION 68 OF THE ACT CANNOT ARISE UNLESS THE AO IS ABLE TO FIND FAULT/INFIRMITY WITH THE SAME. I NO TE THAT THE SOURCE OF THE RECEIPT OF THE AMOUNT HAS BEEN EXPLAINED AND THE TRANSACTION IN RE SPECT OF WHICH THE SAID AMOUNT HAS BEEN RECEIVED BY ASSESSEE HAS NOT BEEN CANCELLED BY THE STOCK EXCHANGE/SEBI. SO, IT IS DIFFICULT TO COUNTENANCE THE ACTION OF AO/LD. CIT(A) IN THE AFOR ESAID FACTS AND CIRCUMSTANCES EXPLAINED ABOVE. 13. EVEN ASSUMING THAT THE BROKERS MAY HAVE DONE S OME MANIPULATION THEN ALSO THE ASSESSEE CANNOT BE HELD LIABLE FOR THE ILLEGAL ACTI ON OF THE BROKERS WHEN THE ENTIRE TRANSACTIONS HAVE BEEN CARRIED OUT THROUGH BANKING CHANNELS DULY RECORDED IN THE DEMAT ACCOUNTS WITH A GOVERNMENT DEPOSITORY AND TRADED ON THE STOCK EXCHANGE UNLESS SPECIFIC 9 ITA NO.2387/KOL/2018 NIKHIL PANSARI, AY 2015-16 EVIDENCE EMERGES THAT THE ASSESSEE WAS IN HAND IN G LOVES WITH THE BROKER FOR COMMITTING THE UNSCRUPULOUS ACTIVITY TO LAUNDER HIS OWN MONEY IN T HE GUISE OF LTCG. 14. THERE IS ALSO NOTHING ON RECORD WHICH COULD SU GGEST THAT THE ASSESSEE GAVE HIS OWN CASH AND GOT CHEQUE FROM THE ALLEGED BROKERS/BUYERS . THE ASSESSMENT REFERS ALSO TO SOME THIRD PARTY STATEMENT OF SHRI SUNIL DOKANIA WHICH W AS ADMITTEDLY RECORDED BEHIND THE BACK OF THE ASSESSEE AND THE ASSESSEE HAS NEITHER BEEN A LLOWED TO CROSS EXAMINE THIS PERSON BY THE ASSESSEE NOR THE STATEMENT OF SHRI SUNIL DOKANI A FURNISHED TO ASSESSEE, SO THE STATEMENTS EVEN IF ADVERSE AGAINST THE ASSESSEE CANNOT BE RELI ED UPON BY THE AO TO DRAW ADVERSE INFERENCE AGAINST THE ASSESSEE (RELIANCE ON HONBLE SUPREME COURT DECISION IN ANDAMAN TIMBER (SUPRA) AND IN THE LIGHT OF THE DOCUMENTS TO SUBSTANTIATE THE CLAIM OF LTCG, WHICH HAS NOT BEEN FOUND FAULT WITH BY THE AO. 15. LET US LOOK AT CERTAIN JUDICIAL DECISIONS ON S IMILAR FACTS:- 16. THE CASE OF THE ASSESSEES IS SIMILAR TO THE D ECISION OF HONBLE BOMBAY HIGH COURT, NAGPUR BENCH IN CIT VS. SMT. JAMNADEVI AGRAWAL &ORS . DATED 23RD SEPTEMBER, 2010 REPORTED IN (2010) 328 ITR 656 WHEREIN IT WAS HELD THAT: 'THE FACT THAT THE ASSESSEES IN THE GROUP HAVE PURC HASED AND SOLD SHARES OF SIMILAR COMPANIES THROUGH THE SAME BROKER CANNOT BE A GROUN D TO HOLD THAT THE TRANSACTIONS ARE SHAM AND BOGUS, ESPECIALLY WHEN DOCUMENTARY ITA NOS. 93 TO 99/RPR/2014 & C.O. NOS. 12 TO 18/RPR/2014 . A.Y. 2004-05 10 PRODU CED TO ESTABLISH THE GENUINENESS OF THE CLAIM. FROM THE DOCUMENTS PRODUCED, IT IS SE EN THAT THE SHARES IN QUESTION WERE IN FACT PURCHASED BY THE ASSESSEES ON THE RESPECTIV E DATES AND THE COMPANY HAS CONFIRMED TO HAVE HANDED OVER THE SHARES PURCHASED BY THE ASSESSEES. SIMILARLY, THE SALE OF THE SHARES TO THE RESPECTIVE BUYERS IS ALSO ESTABLISHED BY PRODUCING DOCUMENTARY EVIDENCE. IT IS TRUE THAT SOME OF THE T RANSACTIONS WERE OFF-MARKET TRANSACTIONS. HOWEVER, THE PURCHASE AND SALE PRICE OF THE SHARES DECLARED BY THE ASSESSEES WERE IN CONFORMITY WITH THE MARKET RATES PREVAILING ON THE RESPECTIVE DATES AS IS SEEN FROM THE DOCUMENTS FURNISHED BY THE ASSE SSEES. THEREFORE, THE FACT THAT SOME OF THE TRANSACTIONS WERE OFF-MARKET TRANSACTIONS CA NNOT BE A GROUND TO TREAT THE TRANSACTIONS AS SHAM TRANSACTIONS. THE STATEMENT OF THE BROKER P THAT THE TRANSACTIONS WITH THE H GROUP WERE BOGUS HAS BEEN DEMONSTRATED T O BE WRONG BY PRODUCING DOCUMENTARY EVIDENCE TO THE EFFECT THAT THE SHARES SOLD BY THE ASSESSEES WERE IN CONSONANCE WITH THE MARKET PRICE. ON PERUSAL OF THO SE DOCUMENTARY EVIDENCE, THE TRIBUNAL HAS ARRIVED AT A FINDING OF FACT THAT THE TRANSACTIONS WERE GENUINE. NOTHING IS BROUGHT ON RECORD TO SHOW THAT THE FINDINGS RECORDE D BY THE TRIBUNAL ARE CONTRARY TO THE DOCUMENTARY EVIDENCE ON RECORD. THE TRIBUNAL HA S FURTHER RECORDED A FINDING OF FACT THAT THE CASH CREDITS IN THE,BANK ACCOUNTS OF SOME OF THE BUYERS OF SHARES CANNOT BE LINKED TO THE ASSESSEES. MOREOVER, YN THE LIGHT OF THE DOCUMENTARY EVIDENCE 10 ITA NO.2387/KOL/2018 NIKHIL PANSARI, AY 2015-16 ADDUCED TO SHOW THAT THE SHARES PURCHASED AND SOLD BY THE ASSESSEES WERE IN CONFORMITY WITH THE MARKET PRICE, THE TRIBUNAL RECO RDED A FINDING OF FACT THAT THE CASH CREDITS IN THE BUYERS' BANK ACCOUNTS CANNOT BE ATTR IBUTED TO THE ASSESSEES. NO FAULT CAN BE FOUND WITH THE ABOVE FINDING RECORDED BY THE TRI BUNAL. THEREFORE, THE DECISION OF THE TRIBUNAL IS BASED ON FINDING OF FACTS. NO SUBST ANTIAL QUESTION OF LAW ARISES FROM THE ORDER OF THE TRIBUNAL.ASSTT. CIT VS. KAMAL KUM AR S. AGRAWAL (INDL.) &ORS. (2010) 41 DTR (NAG) (TRIB) 105: (2010) 133 TTJ (NAG ) 818 AFFIRMED; SUMATIDAYAL VS. CIT (1995) 125 CTR (SC) 124: (1995) 80 TAXMAN 8 9 (SC) DISTINGUISHED. 12. THE HON'BLE HIGH COURT OF RAJASTHAN IN CIT VS. SMT. PUS HPAMALPANI - REPORTED IN (2011) 242 CTR (RAJ.) 559; (2011) 49 DTR 312 DISMISSED THE APPEAL OF DEPARTMENT OBSERVING 'WHETHER OR NOT THERE WAS SALE OF SHARES AND RECEIPT OF CONSIDERATION THEREOF ON APPRECIATED VALUE IS ESSENTIALLY A QUEST ION OF FACT. CIT(A) AND TRIBUNAL HAVE BOTH GIVEN REASONS IN SUPPORT OF THEIR FINDING S AND HAVE FOUND THAT AT THE TIME OF TRANSACTIONS, THE BROKER IN QUESTION WAS NOT BANNED BY SEBI AND THAT ASSESSEE HAD PRODUCED COPIES OF PURCHASE BILLS, CONTRACT NUMBER SHARE CERTIFICATE, APPLICATION FOR TRANSFER OF SHARE CERTIFICATE TO DEMAT ACCOUNT ALON G WITH COPIES OF HOLDING STATEMENT IN DEMAT ACCOUNT, BALANCE SHEET AS ON 31ST MARCH, 2 003, SALE BILL, BANK ACCOUNT, DEMAT ACCOUNT AND OFFICIAL REPORT AND QUOTATIONS, O F CALCUTTA STOCK EXCHANGE ASSOCIATION LTD. ON 23RD JULY, 2003. THEREFORE, 'TH E PRESE/ITDPPEAL DOES NOT RAISE ANY QUESTION OF LAW, MUCH LESS ANY SUBSTANTIAL QUESTION OF LAW. 17. THE HONBLE HIGH COURT OF PUNJAB AND HARYANA IN THE CASE OF ANUPAM KAPOOR 299 ITR 0179 HAS HELD AS UNDER:- THE TRIBUNAL ON THE BASIS OF THE MATERIAL ON RECOR D, HELD THAT PURCHASE CONTRACT NOTE, CONTRACT NOTE FOR SATES, DISTINCTIVE NUMBERS OF SHARES PURCHASED AND SOLD, COPY OF SHARE CERTIFICATES AND THE QUOTATION OF SHARES O N THE DATE OF PURCHASE AND SALE WERE SUFFICIENT MATERIAL TO SHOW THAT THE TRANSACTION WA S NOT BOGUS BUT A GENUINE TRANSACTION. THE PURCHASE OF SHARES WAS MADE ON 28T H APRIL, 1993 I.E.. ASST. YR. 1993- 94 AND THAT ASSESSMENT WAS ACCEPTED BY THE DEPARTME NT AND THERE WAS NO CHALLENGE TO THE PURCHASE OF SHARES IN THAT YEAR. IT WAS ALSO PLACED BEFORE THE RELEVANT AO AS WELL AS BEFORE THE TRIBUNAL THAT THE SALE PROCEEDS HAVE BEEN ACCOUNTED FOR IN THE ACCOUNTS OF THE ASSESSEE AND WERE RECEIVED THROUGH ACCOUNT PAYEE CHEQUE. THE TRIBUNAL WAS RIGHT IN REJECTING THE APPEAL OF THE R EVENUE BY HOLDING THAT THE ASSESSEE WAS SIMPLY A SHAREHOLDER OF THE COMPANY. HE HAD MAD E INVESTMENT IN A COMPANY IN WHICH HE WAS NEITHER A DIRECTOR NOR WAS HE IN CONTR OL OF THE COMPANY. THE ASSESSEE HAD TAKEN SHARES FROM THE MARKET, THE SHARES WERE L ISTED AND THE TRANSACTION TOOK PLACE THROUGH A REGISTERED BROKER OF THE STOCK EXCH ANGE. THERE WAS NO MATERIAL BEFORE THE AO, WHICH COULD HAVE LEAD TO A CONCLUSION THAT THE TRANSACTION WAS SIMPLICITIER A DEVICE TO CAMOUFLAGE ACTIVITIES, TO DEFRAUD THE REV ENUE. NO SUCH PRESUMPTION COULD BE DRAWN BY THE AO MERELY ON SURMISES AND CONJECTURES. IN THE ABSENCE OF ANY COGENT MATERIAL IN THIS REGARD, HAVING BEEN PLACED ON RECO RD, THE AO COULD NOT HAVE REOPENED THE ASSESSMENT. THE ASSESSEE HAD MADE AN I NVESTMENT IN A COMPANY, EVIDENCE WHEREOF WAS WITH THE AO. --THEREFORE, THE AO COULD NOT HAVE ADDED INCOME, WHICH WAS RIGHTLY DELETED BY THE CIT(A) AS WELL AS THE TRIBUNAL. IT IS SETTLED LAW THAT SUSPICION, HOWSOEVER STRONG CANNOT TAKE THE PLACE O F LEGAL PROOF. CONSEQUENTLY, NO QUESTION OF LAW, MUCH LESS A SUBSTANTIAL QUESTION O F LAW, ARISES FOR ADJUDICATION. C. VASANTLAL& CO. VS. CIT (1962) 45 ITR 206 (SC), M.O. THOMAKUTTY VS. CIT (.1958) 34 ITR 501 (KER)) AND MUKAND SINGH VS. SALES TAX TRIBU NAL (1998) 107 STC 300 (PUNJAB) RELIED ON; UMACHARAN SHAW &BROS. VS. CIT ( 1959) 37 ITR 271 (SC) APPLIED; JASPAL SINGH VS. CIT (2006) 205 CTR (P & H ) 624 DISTINGUISHED 11 ITA NO.2387/KOL/2018 NIKHIL PANSARI, AY 2015-16 18. THE CO-ORDINATE BENCH OF AHMEDABAD IN THE CASE OF SMT. SUNITAJALANVS. ITO IN ITA NOS. 501 & 502/AHD/2016 DATED 09.03.2017 HAD THE OC CASION TO CONSIDER A SIMILAR ISSUE WHICH WAS WHEREIN THE ASSESSMENT WAS FRAMED ON THE STRENGTH OF THE STATEMENT OF A BROKER. THE RELEVANT PART READS AS UNDER:- 14. THE ENTIRE ASSESSMENT IS BASED UPON THE STATEM ENT OF SHRI MUKESHCHOKSI. IT IS AN UNDISPUTED FACT THAT NEITHER A COPY OF THE STATEMEN T WAS SUPPLIED TO THE ASSESSEE NOR ANY OPPORTUNITY OF CROSS-EXAMINATION WAS GIVEN BY T HE ASSESSING OFFICER/CIT(A). THE HONBLE SUPREME COURT IN THE CASE OF ANDAMAN TIMBER INDUSTRIES IN CIVIL APPEAL NO. 4228 OF 2006 WAS SEIZED WITH THE FOLLOWING ACTION O F THE TRIBUNAL:- 6. THE PLEA OF NO CROSS EXAMINATION GRANTED TO THE VARIOUS DEALERS WO ULD NOT HELP THE APPELLANT CASE SINCE THE EXAMINATION OF THE DEALERS WOULD NOT BRIN G OUT ANY MATERIAL WHICH WOULD NOT BE IN THE POSSESSION OF THE APPELLANT THEMSELVES TO EXPLAIN AS TO WHY THEIR EX FACTORY PRICES REMAIN STATIC. SINCE WE ARE NOT UPHOLDING AN D APPLYING THE EX FACTORY PRICES, AS WE FIND THEM CONTRAVENED AND NOT NORMAL PRICE AS EN VISAGED UNDER SECTION 4(1), WE FIND NO REASON TO DISTURB THE COMMISSIONERS ORDERS. 15. THE HONBLE APEX COURT HELD AS UNDER:- ACCORDING TO US, NOT ALLOWING THE ASSESSEE TO CROS S-EXAMINE THE WITNESSES BY THE ADJUDICATING AUTHORITY THOUGH THE STATEMENTS OF THO SE WITNESSES WERE MADE THE BASIS OF THE IMPUGNED ORDER IS A SERIOUS FLAW WHICH MAKES THE ORDER NULLITY INASMUCH AS IT AMOUNTED TO VIOLATION OF PRINCIPLES OF NATURAL JUST ICE BECAUSE OF WHICH THE ASSESSEE WAS ADVERSELY AFFECTED. IT IS TO BE BORNE IN MIND T HAT THE ORDER OF THE COMMISSIONER WAS BASED UPON THE STATEMENTS GIVEN BY THE AFORESAI D TWO WITNESSES. EVEN WHEN THE ASSESSEE DISPUTED THE CORRECTNESS OF THE STATEMENTS AND WANTED TO CROSS-EXAMINE, THE ADJUDICATING AUTHORITY DID NOT GRANT THIS OPPORTUNI TY TO THE ASSESSEE. IT WOULD BE PERTINENT TO NOTE THAT IN THE IMPUGNED ORDER PASSED BY THE ADJUDICATING AUTHORITY HE HAS SPECIFICALLY MENTIONED THAT SUCH AN OPPORTUNITY WAS SOUGHT BY THE ASSESSEE. HOWEVER, NO SUCH OPPORTUNITY WAS GRANTED AND THE AF ORESAID PLEA IS NOT EVEN DEALT WITH BY THE ADJUDICATING AUTHORITY. AS FAR AS THE T RIBUNAL IS CONCERNED, WE FIND THAT REJECTION OF THIS PLEA IS TOTALLY UNTENABLE. THE TR IBUNAL HAS SIMPLY STATED THAT CROSS EXAMINATION OF THE SAID DEALERS COULD NOT HAVE BROU GHT OUT ANY MATERIAL WHICH WOULD NOT BE IN POSSESSION OF THE APPELLANT THEMSELVES TO EXPLAIN AS TO WHY THEIR EX FACTORY PRICES REMAIN STATIC. IT WAS NOT FOR THE TRIBUNAL T O HAVE GUESS WORK AS TO FOR WHAT PURPOSES THE APPELLANT WANTED TO CROSS-EXAMINE THOS E DEALERS AND WHAT EXTRACTION THE APPELLANT WANTED FROM THEM. AS MENTIONED ABOVE, THE APPELLANT HAD CONTESTED THE TRUTHFULNESS OF THE STATEMENTS OF THESE TWO WITNESS ES AND WANTED TO DISCREDIT THEIR TESTIMONY FOR WHICH PURPOSE IT WANTED TO AVAIL THE OPPORTUNITY OF CROSS EXAMINATION. THAT APART, THE ADJUDICATING AUTHORITY SIMPLY RELIE D UPON THE PRICE LIST AS MAINTAINED AT THE DEPOT TO DETERMINE THE PRICE FOR THE PURPOSE OF LEVY OF EXCISE DUTY. WHETHER THE GOODS WERE, IN FACT, SOLD TO THE SAID DEALERS/WITNE SSES AT THE PRICE WHICH IS MENTIONED IN THE PRICE LIST ITSELF COULD BE THE SUBJECT MATTE R OF CROSS-EXAMINATION. THEREFORE, IT WAS NOT FOR THE ADJUDICATING AUTHORITY TO PRESUPPOS E AS TO WHAT COULD BE THE SUBJECT MATTER OF THE CROSS EXAMINATION AND MAKE THE REMARK S AS MENTIONED ABOVE. WE MAY ALSO POINT OUT THAT ON AN EARLIER OCCASION WHEN THE MATTER CAME BEFORE THIS COURT IN CIVIL APPEAL NO. 2216 OF 2000, ORDER DATED 17.03.20 05 WAS PASSED REMITTING THE CASE BACK TO THE TRIBUNAL WITH THE DIRECTIONS TO DECIDE THE APPEAL ON MERITS GIVING ITS REASONS FOR ACCEPTING OR REJECTING THE SUBMISSIONS. IN VIEW THE ABOVE, WE ARE OF THE OPINION THAT IF THE TESTIMONY OF THESE TWO WITNESSE S IS DISCREDITED, THERE WAS NO MATERIAL WITH THE DEPARTMENT ON THE BASIS OF WHICH IT COULD JUSTIFY ITS ACTION, AS THE STATEMENT OF THE AFORESAID TWO WITNESSES WAS THE ON LY BASIS OF ISSUING THE SHOW CAUSE. WE, THUS, SET ASIDE THE IMPUGNED ORDER AS PASSED BY THE TRIBUNAL AND ALLOW THIS 12 ITA NO.2387/KOL/2018 NIKHIL PANSARI, AY 2015-16 APPEAL. 16. ON THE STRENGTH OF THE AFOREMENTIONED DECISION OF THE HONBLE SUPREME COURT, THE ASSESSMENT ORDER HAS TO BE QUASHED. 17. EVEN ON FAC TS OF THE CASE, THE ORDERS OF THE AUTHORITIES BELOW CANNOT BE ACCEPTED. THERE IS NO D ENYING THAT CONSIDERATION WAS PAID WHEN THE SHARES WERE PURCHASED. THE SHARES WERE THE REAFTER SENT TO THE COMPANY FOR THE TRANSFER OF NAME. THE COMPANY TRANSFERRED THE S HARES IN THE NAME OF THE ASSESSEE. THERE IS NOTHING ON RECORD WHICH COULD SUGGEST THAT THE SHARES WERE NEVER TRANSFERRED IN THE NAME OF THE ASSESSEE. THERE IS ALSO NOTHING ON RECORD TO SUGGEST THAT THE SHARES WERE NEVER WITH THE ASSESSEE. ON THE CONTRARY, THE SHARES WERE THEREAFTER TRANSFERRED TO DEMAT ACCOUNT. THE DEMAT ACCOUNT WAS IN THE NAME OF THE ASSESSEE, FROM WHERE THE SHARES WERE SOLD. IN OUR UNDERSTANDING OF THE FACTS , IF THE SHARES WERE OF SOME FICTITIOUS COMPANY WHICH WAS NOT LISTED IN THE BOMB AY STOCK EXCHANGE/NATIONAL STOCK EXCHANGE, THE SHARES COULD NEVER HAVE BEEN TRANSFER RED TO DEMAT ACCOUNT. SHRI MUKESHCHOKSI MAY HAVE BEEN PROVIDING ACCOMMODATION ENTRIES TO VARIOUS PERSONS BUT SO FAR AS THE FACTS OF THE CASE IN HAND SUGGEST THAT THE TRANSACTIONS WERE GENUINE AND THEREFORE, NO ADVERSE INFERENCE SHOULD BE DRAWN . 18. IN THE LIGHT OF THE DECISIONS OF THE HONBLE SUPREME COURT IN THE CASE OF ANDAMAN TIMBER INDUSTRIES (SUPRA) AND CONSIDERING THE FACTS IN TOTALITY, THE CLAIM OF THE ASSESSEE CANNOT BE DENIED ON THE BASIS OF PRESUMPTION AND SURMISES IN RESPECT OF PEN NY STOCK BY DISREGARDING THE DIRECT EVIDENCES ON RECORD RELATING TO THE SALE/PURCHASE T RANSACTIONS IN SHARES SUPPORTED BY BROKERS CONTRACT NOTES, CONFIRMATION OF RECEIPT OF SALE PROCEEDS THROUGH REGULAR BANKING CHANNELS AND THE DEMAT ACCOUNT. 19. ACCORDI NGLY, WE DIRECT THE A.O. TO TREAT THE GAINS ARISING OUT OF THE SALE OF SHARES UNDER T HE HEAD CAPITAL GAINS- SHORT TERM OR LONG TERM AS THE CASE MAY BE. THE OTHER GRIEVA NCE OF THE ASSESSEE BECOMES INFRUCTUOUS. 19. THE LD. D.R. HAD HEAVILY RELIED UPON THE DECISI ON OF THE HONBLE BOMBAY HIGH COURT IN THE CASE OF BIMALCHAND JAIN IN TAX APPEAL NO. 18 OF 2017. I NOTE THAT IN THE CASE RELIED UPON BY THE LD. D.R, I FIND THAT THE FACTS ARE DIFF ERENT FROM THE FACTS OF THE CASE IN HAND. FIRSTLY, IN THAT CASE, THE PURCHASES WERE MADE BY T HE ASSESSEE IN CASH FOR ACQUISITION OF SHARES OF COMPANIES AND THE PURCHASE OF SHARES OF T HE COMPANIES WAS DONE THROUGH THE BROKER AND THE ADDRESS OF THE BROKER WAS INCIDENTAL LY THE ADDRESS OF THE COMPANY. THE PROFIT EARNED BY THE ASSESSEE WAS SHOWN AS CAPITAL GAINS W HICH WERE NOT ACCEPTED BY THE A.O. AND THE GAINS WERE TREATED AS BUSINESS PROFIT OF THE AS SESSEE BY TREATING THE SALES OF THE SHARES WITHIN THE AMBIT OF ADVENTURE IN NATURE OF TRADE. T HUS, IT CAN BE SEEN THAT IN THE DECISION RELIED UPON BY THE LD. DR, THE DISPUTE WAS WHETHER THE PROFIT EARNED ON SALE OF SHARES WAS CAPITAL GAINS OR BUSINESS PROFIT. 20. IT IS CLEAR FROM THE ABOVE THAT THE FACTS OF T HE CASE OF THE ASSESSEE ARE IDENTICAL WITH THE FACTS IN THE ABOVE CASE WHEREIN THE CO-ORDINATE BENCH OF THE TRIBUNAL HAS DELETED THE ADDITION IN THE CASE OF SHRI MANISH BAID (SUPRA) IN RESPECT OF SALE OF SHARES OF M/S KAFL. I, 13 ITA NO.2387/KOL/2018 NIKHIL PANSARI, AY 2015-16 THEREFORE, RESPECTFULLY FOLLOWING THE SAME AND THE FACTS IN THE INSTANT CASE AS TAKEN NOTE IN PARA 7 SUPRA AND DISCUSSIONS, IS INCLINED TO SET AS IDE THE ORDER OF LD. CIT(A) AND DIRECT THE AO NOT TO TREAT THE LONG TERM CAPITAL ON SALE OF SH ARES OF M/S KAFL AS BOGUS AND DELETE THE CONSEQUENTIAL ADDITION. 21. BEFORE I PART, I WOULD LIKE TO DEAL WITH THE CA SE LAWS CITED BY LD. DR IN REVENUE SUPPORT. I NOTE THAT THE SAID JUDICIAL PRONOUNCEMEN TS ARE ALL DISTINGUISHABLE ON FACTS AS WELL AS ON LAW. THE SAID DECISIONS ARE DEALT WITH HEREI N BELOW IN SERIATIM AS UNDER: 1. RATNAKAR M. PUJARI VS. ASSESSEE -ITA NO.995/MUM/201 2, ORDER DT. 3RD AUGUST, 2016 [AY 2006-07] -ITAT MUMBAI IN THIS CASE THE ITAT, MUMBAI BENCH WERE CONSIDERIN G A CASE WHERE THE PURCHASES OF SHARES WERE TREATED AS BOGUS AND SHAM TRANSACTIO NS BY THE REVENUE IN THE IMMEDIATELY PRECEDING FINANCIAL YEAR 2005-06 AND TH E SAID FINDINGS OF THE AO WITH RESPECT TO BOGUS AND SHAM PURCHASES WERE NOT CHALLE NGED BY THE ASSESSEE. IN SUCH FACTS OF THE CASE THE TRIBUNAL HAD TREATED THE EXEM PT LONG TERM CAPITAL GAINS ARISING ON SALES OF SHARES AS BOGUS AND SHAM. HOWEVER, THER E IS NO SUCH FINDING OF FACT IN THE INSTANT CASE AND THUS THE FACTS IN THE INSTANT CASE ARE DISTINGUISHABLE. IT WAS BROUGHT TO MY NOTICE THAT THE AFORESAID ORDE R OF ITAT, MUMBAI, INTER-ALIA, HAD BEEN DISTINGUISHED BY CO-ORDINATE BENCHES OF THE TR IBUNAL IN THE FOLLOWING CASES: A. KAUSHALYA AGARWAL VS. ITO [ITA NO.194/KO/2018, O RDER DT. 03.06.2019 (KOL, ITAT)] B. MEENU GOEL VS. ITO [2018] 94 TAXMANN.COM 158 (DE L-TRIB) 2. RITU SANJAY MANTRY VS. ITO - ITA NO.2003/MUM/2017, ORDER DT. 9TH FEBRUARY, 2018 - ITAT MUMBAI IN THIS CASE IS THAT WAS REOPENED BY THE AO ON THE BASIS OF INFORMATION RECEIVED FROM OFFICE OF DGIT (C&IB), NEW DELHI THAT THE ASSESSEE HAD TAKEN ACCOMMODATION ENTRY FROM M/S. MAGASAGAR SECURITIES PVT. LTD. (A COMPAN Y IN THE MAHASAGAR SECURITIES PVT. LTD. GROUP SHARE SCAM CASE) OF RS.10,32,289/-. SUBSEQUENTLY THE ASSESSMENT WAS COMPLETED U/S. 147 R.W.S. 143(3) OF THE ACT AFTER M AKING AN ADDITION OF RS.10,39,289/- ON ACCOUNT OF BOGUS SHARE TRANSACTIO NS AND RS.20,786/- BEING COMMISSION PAID TO THE BROKER FOR ARRANGING ACCOMMO DATION ENTRIES IN THE FORM OF 14 ITA NO.2387/KOL/2018 NIKHIL PANSARI, AY 2015-16 SHARE TRANSACTIONS. THE AO HAD GIVEN A FINDING THAT THE ASSESSEE HAD TAKEN ENTRIES FROM MAHASAGAR SECURITIES PVT. LTD. INVOLVED IN THE SHARES SCAM CASE FOR RS.10,39,289/- FOR BOGUS SPECULATION PROFIT DURING THE FINANCIAL YEAR 2007 -08. IT WAS FURTHER FOUND BY THE AO THAT THE ASSESSEE HAS PAID CASH OF EQUIVALENT AMOUNT AND RECEIVED BACK BY CHEQUE AND BOGUS CONTRACT NOTES AN D BILLS FOR THE TRANSACTIONS NOT ACTUALLY ROOTED THROUGH STOCK EXCHANGE. IT IS NOTE D THAT THE ITAT, MUMBAI HAD RELIED UPON AND FOLLOWED THE JUDGMENT OF HON'BLE BO MBAY HIGH COURT IN SANJAY BIMALCHAND JAIN V. PCIT, ORDER DATED 10.04.2017 (BO M.), BEING JUDGMENT OF JURISDICTIONAL HIGH COURT. HOWEVER, IN THIS CASE, THE AO OBSERVED THAT THE ASSESSEE HAD TAKEN ENTRIES AND PAID CASH OF EQUIVALENT AMOUN T AND RECEIVED BACK BY CHEQUE. AND ON THE BASIS OF SUCH ADVERSE INFERENCE, THE TRI BUNAL CONFIRMED THE ADDITION MADE BY THE AO. HOWEVER, IN THE PRESENT CASE IN HAN D, THERE IS NO SUCH FINDING MADE BY THE AO. FURTHER. IT IS NOTED THAT THE ABOVEMENTIONED JUDGME NT OF ITAT, MUMBAI BENCH HAS BEEN CONSIDERED AND DISTINGUISHED BY THE ITAT, KOLK ATA BENCHES AND OTHER BENCHES OF THE TRIBUNAL, INTER-ALIA, IN THE FOLLOWING CASES : A. SATYANARAYAN SARIA VS. ITO [ITA NO.1224/KOIL2016 , ORDER DT. 28.06.2019 (KOL ITAT)] B. KAUSHALYA AGARWAL VS. ITO [ITA NO.194/KOIL2018, ORDER DT. 03.06.2019 (KOL, ITAT)] C. MEENU GOEL VS. ITO [2018] 94 TAXMANN.COM 158 (DE L-TRIB) REFERENCE IS ALSO MADE TO THE RECENT JUDGMENT DATED 01.07.2019 RENDERED BY THIS TRIBUNAL IN THE CASE OF APARNA MISRA VS. ITO (ITA N O. 161/KOL/2019) WHEREIN THE TRIBUNAL HAD RELIED UPON THE FOLLOWING JURISDICTION AL CALCUTTA HIGH COURT JUDGMENTS TO DECIDE SIMILAR ISSUE IN FAVOUR OF THE ASSESSEE. I) M/S CLASSIC GROWERS LTD. VS. CIT [ITA NO. 129 O F 2012] II) CIT VS. LAKSHMANGARH ESTATE & TRADING CO. LIMIT ED [2013] 40 TAXMANN.COM 439 (CAL) III) CIT V. SHREYASHI GANGULI [ITA NO. 196 OF 2012 ] IV) CIT V. RUNGTA PROPERTIES PRIVATE LIMITED [ITA NO. 105 OF 2016] 15 ITA NO.2387/KOL/2018 NIKHIL PANSARI, AY 2015-16 V) CIT V. ANDAMAN TIMBERS INDUSTRIES LIMITED [ITA NO. 721 OF 2008] VI) CIT V. BHAGWATI PRASAD AGARWAL [2009- TMI-3473 8-ITA NO. 22 OF 2009, ORDER DT. 29.4.09] 3) COMING TO THE CASE OF ITO VS. SHAMIM M. BHARWANI (2016) 69 TAXMANN.COM (MUM ITAT), ORDER DT. 27.03.2015 OF MUMBAI TRIABUNA L, THE BRIEF FACTS IN THIS CASE WAS THAT THE ASSESSEE PURCHASED 2500 SHARES OF EMR ALD COMMERCIAL LTD. (ECL). THE PURCHASE WAS IN CASH. ACCORDING TO THE AO SINCE THE PURCHASE WAS MADE IN CASH, THE SAME WAS NOT VERIFIABLE. FURTHER, THE A.O. FOUND TH AT SAID TRANSACTION WAS NOT THROUGH THE STOCK EXCHANGE. THE SHARES WERE IN A NO NDESCRIPT COMPANY, WITH NO FINANCIAL AND/OR PHYSICAL ASSETS OF VALUE OR REPORT ED EARNINGS. THE SHARES, PURCHASED AT AN AVERAGE RATE OF RS. 21.70 PER SHARE IN MAY 20 04, WENT UP TO AS MUCH AS FROM RS. 465 TO RS. 489 IN JULY, 2005, I.E., JUST OVER Y EARS' TIME. EACH OF THESE INCIDENTS MATCHED WITH THAT WHICH COULD BE EXPECTED IN A CASE OF A TRANSACTION IN A PENNY STOCK, THE MODUS OPERANDI OF THE TRANSACTIONS IN WH ICH WAS ALSO LISTED BY THE AO. ACCORDINGLY, RELYING ON THE DECISIONS BY THE APEX C OURT IN THE CASE OF SUMATI DAYAL V. CIT [1995] 214 ITR 801/80 TAXMAN 89 (SC); DURGA PRASAD MORE V. CIT [1971] 182 ITR 540 (SC) AND MC. DOWELL & CO. LTD. V. CTO [ 1985] 154 ITR 148/22 TAXMAN 11 (SC), BESIDES BY THE TRIBUNAL IN THE CASE OF ASSTT. CIT V. SOM NATH MAINI [2006] 7 SOT 202 (CHD.), HE ASSESSED THE IMPU GNED CREDIT OF RS. 12.15 LACS AS UNEXPLAINED INCOME U/S. 68 OF THE ACT. THE TRIBUNAL CONFIRMED THE ADDITION OBSERVING THAT THE PURCHASE OF SHARES WAS OFF MARKE T PURCHASE NOT REPORTED IN THE STOCK EXCHANGE. FURTHER, IT WAS OBSERVED BY THE TRI BUNAL THAT THE PURCHASE WAS THROUGH A BACK DATE CONTRACT NOTE IN CASH AND, THER E WAS NO TRAIL. THUS IT IS NOTED THAT TRIBUNAL IN THIS CASE CONFIRMED THE ADDITION O N A FACTUAL FINDING THAT THE PURCHASE WAS THROUGH A BACK DATED CONTRACT NOTE IN CASH AND, THERE WAS NO TRAIL. THIS FACT IS NOT APPLICABLE IN THE PRESENT CASE. FURTHER, IT IS NOTED THAT THE ABOVEMENTIONED JUDGME NT OF TRIBUNAL, MUMBAI BENCH WAS CONSIDERED/DISTINGUISHED BY THE MUMBAI ITAT IN ITS FOLLOWING JUDGMENTS WHILE ALLOWING SIMILAR ISSUE IN FAVOUR OF THE ASSESSEE: A. DCIT VS. ANIL KAINYA [ ITA NOS.4077 & 4078/MUM/2 013, ORDER DT. 22.03.16 MUM ITAT)] 16 ITA NO.2387/KOL/2018 NIKHIL PANSARI, AY 2015-16 B. ANJALI PANDIT VS. ACIT [2017] 88 TAXMANN.COM 657 (MUMBAI - TRIB.) FURTHER, IT IS NOTED THAT LTHE SAID JUDGMENT HAS BE EN CONSIDERED/DISTINGUISHED BY THE KOLKATA AND OTHER BENCHES OF THE TRIBUNAL, INTER-AL IA, IN THE FOLLOWING CASES WHILE ALLOWING SIMILAR ISSUE IN FAVOUR OF THE ASSESSEE. A. KAUSHALYA AGARWAL VS. ITO [ITA NO.194/KOL/2018, ORDER DT. 03.06.2019 (KOL ITAT)] B. ANUPAMA GARG VS. ITO [ITA NO.5971/0EL/2018, ORDE R DT. 12.12.2018 (DEL, ITAT)] C. RADHIKA GARG. VS. ITO [ITA NO.4738/0EL/2018, ORD ER DT. 01.01.2019 (DEL-TRIB) 4. COMING TO THE CASE OF VIDYA REDDY - ITA NO.126/CHNY /2017 - CHENNAI ITAT HAD DISALLOWED THE CLAIM OF EXEMPT LTCG AND HAD CON FIRMED THE ADDITION MADE ON THE GROUND THAT THE ASSESSEE HAS NOT PLACED ANY MAT ERIAL BEFORE THE LOWER AUTHORITIES TO PROVE THAT HER TRANSACTIONS ARE GENUINE. THE TR IBUNAL OBSERVED SHE HAS ALSO NOT PLACED ANY MATERIAL TO PROVE THAT HER CLAIM OF EXEM PTION U/S. 10(38) IS GENUINE AND VALID. HOWEVER, IN THE CASE OF THE ASSESSEE COMPAN Y ALL RELEVANT DOCUMENTS WERE FURNISHED TO SUPPORT PURCHASES AS WELL AS SALE OF S HARES. FURTHER, THE CHENNAI TRIBUNAL HAD RELIED UPON AND FOLLOWED THE JUDGMENT OF HONBLE BOMBAY HIGH COURT IN SANJAY BIMALCHAND JAIN VS. PCIT, ORDER DATED 10. 04.2017, WHICH JUDGMENT HAS BEEN CONSIDERED AND DISTINGUISHED BY KOLKATA AND OT HER BENCHES OF THE TRIBUNAL, INTER-ALIA, IN THE FOLLOWING CASES: A. SATYANARAYAN SARIA VS. ITO [ITA NO.1224/KOL/2016 , ORDER DT. 28.06.2019 (KOL ITAT)] B. KAUSHALYA AGARWAL VS. ITO [ITA NO.194/KOL/2018, ORDER DT. 03.06.2019 (KOL, ITAT)] C. MEENU GOEL VS. ITO [2018] 94 TAXMANN.COM 158 (DE L-TRIB) REFERENCE IS ALSO MADE TO THE RECENT JUDGMENT DATED 1ST JULY, 2019 RENDERED BY THE TRIBUNAL IN THE CASE OF APARNA MISRA VS. ITO [ITA N O.161/KOIL2019] WHEREIN THE TRIBUNAL HAD RELIED UPON THE JURISDICTIONAL CALCUTT A HIGH COURT JUDGMENTS, AS MENTIONED HEREINABOVE. 5. M. K. RAJESHWARI VS. ITO [2018] 99 TAXMANN.COM 339 THE BANGALORE TRIBUNAL NOTED THE ACTS IN THIS CASE AS THE ASSESSE E EARNED LONG-TERM CAPITAL GAIN ON 17 ITA NO.2387/KOL/2018 NIKHIL PANSARI, AY 2015-16 SALE OF SHARES OF MARL AND CLAIMED EXEMPTION ON IT UNDER SECTION 10(38). THE ASSESSING OFFICER RELYING UPON THE REPORT OF THE IN VESTIGATION WING, SEBI REPORT AND FINDINGS/OBSERVATIONS OF THE SIT, CONCLUDED THAT EX EMPTION UNDER SECTION 10(38) CLAIMED BY THE ASSESSEE WAS NOT ACCEPTABLE AND THE ACT OF THE ASSESSEE IN PURCHASING THE PENNY STOCK SHARES AND SALE OF FEE WITHIN THE A MBIT OF ADVENTURE IN THE NATURE OF TRADE. CONSEQUENTLY, AMOUNT IN QUESTION WAS LIABLE TO BE TAXED UNDER THE HEAD 'BUSINESS INCOME'. THE TRIBUNAL CONFIRMED THE ADDIT ION BY OBSERVING THAT THE DEPARTMENT HAD BROUGHT SUFFICIENT MATERIAL ON RECOR D TO DEMONSTRATE THAT UNACCOUNTED MONEY WAS INTRODUCED IN THE BOOKS OF AC COUNT THROUGH LONG-TERM CAPITAL GAIN BY ADOPTING SUCH METHOD. IT IS NOTED THAT IN THE AFORESAID CASE, THE TRIBUNA L CONFIRMED THE ADDITION ON A FACTUA1 FINDING THAT THE DEPARTMENT HAD BROUGHT SUFFICIENT MATERIAL ON RECORD TO DEMONSTRATE THAT UNACCOUNTED MONEY WAS INTRODUCED IN THE BOOKS OF ACCOUNT THROUGH LONG-TERM CAPITAL GAIN BY ADOPTING SUCH METHOD. THIS FACT IS NOT APPLICABLE IN THE PRESENT CASE. FURTHER, THE ABOVEMENTIONED JUDGMENT HAS BEEN CONSI DERED/DISTINGUISHED BY THIS TRIBUNAL, INTER-ALIA, IN THE FOLLOWING CASES WHILE ALLOWING SIMILAR ISSUE IN FAVOUR OF THE ASSESSEE: A. KAUSHALYA AGARWAL VS. ITO [ITA NO.194/KOL/2018, ORDER DT. 03.06.2019 (KOI ITAT)] B. YOGESH DALMIA VS. ACIT [ITA NO.113/KOL/2018, ORD ER DT. 03.06.2019 (KOI ITAT)] C. NAVIN KUMAR KAJARIA VS. ACIT [ITA NO.1254-55/KOL /2018, ORDER DT. 03.04.2019 (KOL- TRIB) D. SOUMITRA CHOUDHURY VS. ACIT [ITA NO.256/KOL/2019 , ORDER DT. 15.03.2019 (KOL ITAT)] 6. COMING TO THE CASE OF ABHIMANYU SOIN [2018-TIOL-733 -ITAT-CHD THE CHANDIGARH BENCH OF TRIBUNAL HAD CONFIRMED THE ADDI TION MADE BY AO AFTER OBSERVING THAT '11. THE ASSESSEE HAS FAILED TO PROVE THAT THE PURC HASE AND SALE TRANSACTIONS ARE GENUINE AND COULD NOT EVEN FURNISH AND IOTA OF EVID ENCE REGARDING THE SALE OF SHARES .............. HOWEVER, IN THE CASE OF THE ASSESSE E COMPANY ALL RELEVANT DOCUMENTS WERE FURNISHED TO SUPPORT, AND PROVE BEYOND ALL DOU BTS, PURCHASES AND AS WELL AS SALE 18 ITA NO.2387/KOL/2018 NIKHIL PANSARI, AY 2015-16 OF SHARES, WHICH WAS EVIDENTLY ABSENT IN THAT CASE, SO IS NOT APPLICABLE TO CASE IN HAND. 7. COMING TO THE CASE OF BALBIR CHAND MAINI VS. CIT (2011) 12 TAXMANN.COM 276 (P&H) THE HONBLE PUNJAB & HARYANA HIGH COURT HAD CONFIRMED T HE ADDITION MADE BY ASSESSING OFFICER ON THE BASIS OF FINDING O F FACT BY THE TRIBUNAL: 10. THE TRIBUNAL WHILE ADJUDICATING THE ISSUE AGAI NST THE ASSESSEE HAD RECORDED A FINDING OF FACT THAT THE TRANSACTION OF SALE AND PU RCHASE OF SHARES OF M/S. ANKUR INTERNATIONAL LTD., WAS NOT A GENUINE TRANSACTION, A PART WHERE OF RELEVANT TO THE PRESENT ISSUE, MENTIONED IN PARA NOS. 27 AND 28 OF THE ORDER, READS AS UNDER .... HOWEVER, IN THE CASE OF THE ASSESSEE COMPANY ALL RE LEVANT DOCUMENTS WERE FURNISHED TO SUPPORT, AND PROVE BEYOND ALL DOUBTS, PURCHASES AND AS WELL AS SALE OF SHARES. FURTHER THIS JUDGMENT HAS BEEN CONSIDERED AND DISTI NGUISHED BY THIS TRIBUNAL AND OTHER BENCHES OF THE TRIBUNAL, INTER-ALIA, IN THE F OLLOWING CASES WHILE ALLOWING SIMILAR ISSUE IN FAVOUR OF THE ASSESSEE: A. KAUSHALYA AGARWAL VS. ITO [ITA NO.194/KOL/2018, ORDER DT. 03.06.2019 (KOL ITAT)] B. KAMAL SINGH KUNDALIA VS. ITO [ITA NO.2359/KOL/20 17, ORDER DT. 08.05.2019 (KOL ITAT)] C. MEENU GOEL VS. ITO [2018] 94 TAXMANN.COM 158 (DE L-TRIB) 8. COMING TO THE CASE OF CHANDAN GUPTA VS. CIT (2015) 54 TAXMANN.COM 10 (P&H ) THE HON'BLE PUNJAB & HARYANA HIGH COURT HAD CON FIRMED THE ADDITION MADE BY ASSESSING OFFICER ON THE BASIS OF FINDING O F FACT BY THE TRIBUNAL THAT THE ASSESSEE HAD FAILED TO PROVE THE GENUINENESS OF THE TRANSACTION OF SALE AND PURCHASE OF SHARES. THE RELEVANT OBSERVATION IS AS UNDER: ' ..... ON APPRECIATION OF THE EVIDENCE, THE TRIBUNAL HELD THAT THE ASSESSEE HAD FAILED TO PROVE THE GENUINENESS OF THE TRANSACTION OF SALE AN D PURCHASE OF SHARES. ONCE THE TRANSACTION OF PURCHASE AND SALE WAS FOUND TO BE BO GUS THEN THE SALE PROCEEDS HAD TO BE ADDED AS INCOME OF THE ASSESSEE UNDER SECTION 68 OF THE ACT BECAUSE THE MONEY RECEIVED ON THE BASIS OF BOGUS TRANSACTION HAD BEEN CREDITED BY THE ASSESSEE IN THE BOOKS OF ACCOUNT WHICH REMAINED UNEXPLAINED. 9. IN VIEW OF THE FINDINGS OF FACT RECORDED BY THE AUTHORITIES BELOW WHICH COULD NOT BE DEMONSTRATED TO BE ERRONEOUS OR PERVERSE IN ANY MAN NER, NO INTERFERENCE IS CALLED FOR. ' 19 ITA NO.2387/KOL/2018 NIKHIL PANSARI, AY 2015-16 HOWEVER, IN THE INSTANT CASE OF THE ASSESSEE COMPAN Y ALL RELEVANT DOCUMENTS WERE FURNISHED TO SUPPORT AND PROVE BEYOND ALL DOUBTS, P URCHASES AS WELL AS SALE OF SHARES. FURTHER THIS JUDGMENT HAS BEEN CONSIDERED AND DISTI NGUISHED BY THIS TRIBUNAL AND OTHER BENCHES OF THE TRIBUNAL, INTER-ALIA, IN THE F OLLOWING CASES WHILE ALLOWING SIMILAR ISSUE IN FAVOUR OF THE ASSESSEE: A. KAUSHALYA AGARWAL VS. ITO [ITA NO.194/KOL/2018, ORDER DT. 03.06.2019 (KOL, ITAT)] B. KAMAL SINGH KUNDALIA VS. ITO [ITA NO.2359/KOL/20 17, ORDER DT. 08.05.2019 (KOL ITAT)] C. MEENU GOEL VS. ITO [2018] 94 TAXMANN.COM 158 (DE L-TRIB) 9. COMING TO THE CASE OF CIT VS. SUNITA DHADDA (HONBL E SUPREME COURT JUDGMENT DATED 06.06.2018), IT IS NOTED THAT THIS JUDGMENT RELIED UPON BY THE DEPARTMENT HAS NO APPLICATION IN THE FACTS OF THE I NSTANT CASE. THE CONTENTION OF LD. DR THAT MATTER SHOULD BE SET ASIDE TO AO FOR SUPPLY ING THE ASSESSEE WITH INVESTIGATION WING REPORT AND STATEMENTS OF PARTIES RELIED UPON CANNOT BE APPLIED IN EACH AND EVERY CASE. THE ASSESSEE COMPANY HAD IN T HE CASE IN HAND DISCHARGED THE ONUS CASTED UPON IT TO PROVE THE CLAIM OF LTCG/STCL , THEN IT WAS THE BOUNDEN DUTY OF THE AO TO BRING OUT THE FALSITY/FABRICATION/WRON G DOING IF ANY ON THE PART OF ASSESSEE OR CONFRONT THE ASSESSEE WITH ANY MATERIAL WHICH IS ADVERSE AGAINST THE ASSESSEE AND TO PROCEED IN ACCORDANCE TO LAW I.E. I N CONFRONTING WITH PRINCIPLE OF NATURAL JUSTICE WITHOUT DOING SO, AND WHEN ASSESSEE PLACED ALL DOCUMENTARY EVIDENCES BEFORE THE AO/LD. CIT(A), THE ASSESSEE CA NNOT BE AGAIN SENT BACK BEFORE AO AND THE DECISION TO SEND BACK TO AO IS DECIDED W HEN PROPER OPPORTUNITY HAS NOT BEEN GIVEN BY AO DURING ASSESSMENT STAGE AND THAT I S NOT THE CASE HERE IN THE CASE IN HAND. 10. COMING TO THE FOLLOWING CASES. I NOTE THAT IN THESE CASES GIVEN BELOW MAHENDRA KUMAR BHANDARI VS. ITO [ORDER DT. 06.04.20 18] ARAVIND KUMAR, CHENNAI VS. ITO [ORDER DT. 08.11.201 8] VIKRAM DUGHAR, CHENNAI VS. ITO [ORDER DT. 13.11.201 8] SADHANA, BANGALORE VS. ITO [ORDER DT. 26.05.2017] ARUN KUMAR BHAIYA, NEW DELHI VS. ITO [ORDER DT. 30. 08.2018] NATTI SINGH HUF, JAIPUR VS. ACIT [ORDER DT. 31.10.2 018] 20 ITA NO.2387/KOL/2018 NIKHIL PANSARI, AY 2015-16 VINOD J. SHARMA, THANE [ORDER DT. 28.10.2015] ALL THE MATTERS WERE SET ASIDE TO THE FILE OF THE A O FOR FRESH CONSIDERATION AND/OR TO CONFRONT THE ASSESSEE WITH THE ADVERSE MATERIALS US ED AGAINST HIM. THE MATTERS IN EACH OF THE SAID CASES WERE SET ASIDE IN THE SPECIF IC FACTS AND CIRCUMSTANCES OF EACH OF THE CASES WERE SET ASIDE IN THE SPECIFIC FACTS AND CIRCUMSTANCES OF EACH OF THE CASES WHEREIN ALL FACTS WERE NOT AVAILABLE ON RECOR D AND/OR WHERE IN THE WORDS OF THE D/R THE AO HAS BOTCHED UP ENQUIRY. HOWEVER, IN THE CASE IN HAND THERE IS NO OCCASION FOR SETTING ASIDE THE MATTER IN AS MUCH AS THE ASSESSEE HAD FURNISHED ALL RELEVANT DOC UMENTS, MATERIALS AND/OR EVIDENCE TO SUPPORT ITS TRANSACTIONS OF PURCHASE AND AS WELL AS SALE OF SHARES AND THE AO HAD FAILED TO POINT OUT ANY DEFECT AND/OR LACUNA IN THE SAID DOCUMENTS, MATERIALS AND/OR EVIDENCE. FURTHER, THIS TRIBUNAL IN ITS ORDERS HAD DECIDED SI MILAR ISSUE IN FAVOUR OF THE ASSESSEE BY RELYING ON BINDING JUDICIAL PRONOUNCEMENTS. REF ERENCE IS ALSO MADE TO THE RECENT JUDGMENT DATED 1 ST JULY, 2019 RENDERED BY THE TRIBUNAL IN THE CASE OF APARNA MIWSRA, SUPRA WHEREIN THE TRIBUNAL HAD RELIED UPON THE FOLL OWING JURISDICTIONAL CALCUTTA HIGH COURT JUDGMENTS TO DECIDE SIMILAR ISSUE IN FAVOUR OF THE ASSESSEE. I) M/S CLASSIC GROWERS LTD. VS. CIT [ITA NO. 129 OF 2012] II)CIT VS. LAKSHMANGARH ESTATE & TRADING CO. LIMITE D [2013] 40 TAXMANN.COM 439 (CAL) III) CIT V. SHREYASHI GANGULI [ITA NO. 196 OF 2012] IV) CIT V. RUNGTA PROPERTIES PRIVATE LIMITED [ITA N O. 105 OF 2016] V) CIT V. ANDAMAN TIMBERS INDUSTRIES LIMITED [ITA N O. 721 OF 2008] VI) CIT V. BHAGWATI PRASAD AGARWAL [2009- TMI-34738 -ITA NO. 22 OF 2009, ORDER DT. 29.4.09] 11. COMING TO THE CASES GIVEN BELOW PREM JAIN VS. ITO [ITAT, DELHI, ORDER DT. 22.03.201 8] SANJAY BIMALCHAND JAIN VS. PCIT [2018] 89 TAXMANN.C OM 196 (BOM) THE DECISIONS OF THESE CASES HAD BEEN RELIED UPON B Y D/R TO CONTEND THAT GAINS FROM SALE OF SHARES SHOULD BE ASSESSED AS 'BUSINESS INCO ME' AND NOT UNDER THE HEAD 'CAPITAL GAINS'. IT IS NOTED THAT THE LEARNED D/R I S TRYING TO PUT FORWARD A 21 ITA NO.2387/KOL/2018 NIKHIL PANSARI, AY 2015-16 COMPLETELY NEW ARGUMENT WHICH DO NOT EMANATE OUT OF THE ORDERS OF THE LOWER AUTHORITIES AND ALSO FROM THE RECORDS OF THE CASE A ND THUS IS NOT PERMISSIBLE TO BE RAISED AS THIS STAGE. EVEN OTHERWISE, THE ITAT, DELHI BENCH IN PREM JAIN (SUPRA) HAD HELD WHEN THE FACTS OF THE CASE WAS THAT THE ASSESSEE HAD CLAIMED THE I NCOME FROM SALE OF SHARES TO BE ASSESSED AT BUSINESS PROFITS AND NOT CAPITAL GAINS WHERE THERE WAS SHORT DURATION OF HOLDING OF SHARES AND LACK OF CLARITY IN ACCOUNT BO OKS, SALE AND PURCHASE OF SHARES. IN SUCH FACTS OF THE CASE, IT WAS HELD THAT PROFITS FR OM SALE OF SHARES WOULD AMOUNT TO BUSINESS INCOME AND NOT SHORT TERM CAPITAL GAIN. HO WEVER, NO SUCH CASE HAD BEEN MADE OUT BY THE ASSESSING OFFICER IN THE INSTANT CA SES. THE AFORESAID ORDER HAS BEEN CONSIDERED BY THIS TRI BUNAL WHILE DECIDING SIMILAR ISSUE IN FAVOUR OF AN ASSESSEE IN THE CASE OF KAUSHALYA A GARWAL VS. ITO (ITA NO. 194/KOL/2018, ORDER DATED 03.06.2019 (ITAT, KOL). MORE PARTICULARLY, THE JUDGMENT OF HONBLE BOMBAY H IGH COURT IN SANJAY BIMALCHAND JAIN V. PCIUT, ORDER DATED 10.04.2017 (B OM HC) HAD BEEN CONSIDERED AND DISTINGUISHED BY THIS TRIBUNAL AND OTHER BENCHE S OF THE TRIBUNAL, INTER-ALIA, IN THE FOLLOWING CASES: A. SATYANARAYAN SARIA VS. ITO [ITA NO.1224/KOL/2016 , ORDER DT. 28.06.2019 (KOL ITAT)] B. KAUSHALYA AGARWAL VS. ITO [ITA NO.194/KOL/2018, ORDER DT. 03.06.2019 (KOL, ITAT)] C. MEENU GOEL VS. ITO [2018] 94 TAXMANN.COM 158 (DE L-TRIB) 12. COMING TO THE CASES GIVEN BELOW: ACIT VS. MADHURI SUNIL KOTECHA [ITAT, PUNE, ORDER D T. 28.03.2018] CHARU AGARWAL, MEERUT VS. ITO [ITAT, DELHI, ORDER D T. 10.09.2018] DAYARAM KHANDELWAL VS. PCIT [MP HIGH COURT, ORDER D T. 01.03.2018] SOURABH KHANDELWAL VS. PCIT [MP HIGH COURT, ORDER D T. 01.03.2018] IT IS NOTED THAT IN ALL OF THESE CASES RELATES TO I MPOSITION OF PENALTY UNDER SECTION 271(1)(C) OF THE ACT IN THE FACTS WHERE THE ASSESSE E HAD WITHDRAWN/SURRENDERED HIS/HER CLAIM OF EXEMPT L TCG U/S. 10(38) OF THE AC T AND PAID TAXES ON THE GAINS ARISING FROM SALE OF SHARES. ALL THESE JUDGMENTS AR E IRRELEVANT AND HAS NO APPLICATION TO THE FACTS OF THE INSTANT CASE BEFORE THE TRIBUN AL. 22 ITA NO.2387/KOL/2018 NIKHIL PANSARI, AY 2015-16 13. COMING TO THE CASE OF SEBI V. RAKHI TRADING P. LTD [CIVIL APPEAL NO.1969 OF 2011, JUDGMENT DATED 8TH FEBRUARY, 2018 (OF THE HON BLE SUPREME COURT ) IT IS NOTED THAT THE HON'BLE SUPREME COURT WAS CONCERNED WITH A CASE WHERE SEBI HAD INITIATED ACTIONS AGAINST FEW TRADERS AND BROKERS FOR VIOLATI ON OF REGULATIONS 3(A), (B) AND (C) AND 4 (1), (2)(A) AND (B) OF THE SECURITIES AND EXC HANGE BOARD OF INDIA (PROHIBITION OF FRAUDULENT AND UNFAIR TRADE PRACTICES RELATING T O SECURITIES MARKET) REGULATIONS, 2003 ('THE PFUTP REGULATIONS'). IN THE SAID CASE, T HE HON'BLE APEX COURT UPHELD THE ACTION INITIATED IN THE CASE OF TRADERS AS THE SAID TRADERS HAVE ADMITTED OF BEING INVOLVED IN SYNCHRONIZED TRADE TO MANIPULATE THE PR ICES OF SHARES. THERE IS NO SUCH ADMISSION BY THE ASSESSEE IN THE INSTANT CASE THAT IT HAS INVOLVED IN ANY PRICE MANIPULATION AND/OR ANY DUBIOUS TAX PLANNING. MOREO VER, THE HON'BLE APEX COURT HAD SET ASIDE THE ACTION INITIATED BY SEBI IN THE C ASE OF BROKERS AS THERE WAS NO EVIDENCE ON RECORD TO SHOW INVOLVEMENT OF THE SAID BROKERS. SIMILARLY IN THE INSTANT CASES THE DEPARTMENT HAD FAILED TO BRING ON RECORD ANY EVIDENCE WHATSOEVER TO SHOW THAT THE ASSESSEE WAS INVOLVED IN ANY PRICE MANIPUL ATIONS. THUS THE JUDGMENT OF THE HON'BLE SUPREME COURT IS CLEARLY DISTINGUISHABLE ON FACTS. THE SAID JUDGMENT HAD BEEN HELD TO BE DISTINGUISHABLE BY THE ITAT, KOLKAT A BENCHES IN THE FOLLOWING JUDGMENTS:- I. SUMAN SARAF V. ITO IN ITA NO.1395/KOI/2018, ORDE R DATED 05.10.2018. II. JIGNESH DESAI V. ITO IN ITA NO.1394/KOI/2018, O RDER DATED 05.10.2018. III. RISHAB JAIN V. ITO IN ITA NO.1392/KOI/2018, OR DER DATED 05.10.2018. IV. REKHA DEVI V. ITO IN ITA NO.1269/KOI/2018, ORDE R DATED 05.10.2018. V. SUNITA DEVI V. ITO IN ITA NO. 1268/KO1/2018, ORD ER DATED 05.10.2018. VI. JAGAT LAL JAIN V.ITO IN ITA NO.1226/KOI/2018, O RDER DATED 05.10.2018. VII. SNEHA CHOUDHARY V. ITO IN ITA NO.1218/KOI/2018 , ORDER DATED 05.10.2018. VIII. U.C.CHOUDHARY & ORS (HUF) V. ITO IN ITA NO.12 17/KOI/2018, ORDER DATED 05.10.2018. IX. VIRENDARA BARMECHA V. ITO IN ITA NO.1201/KOI/20 18, ORDER DATED 05.10.2018. X. TARUNA DEVI BARMECHA V. ITO IN ITA NO.1199/KOI/2 018, ORDER DT. 05.10.2018. XI. PREMLATA AGARWAL VS. ITO IN ITA NO.874/KOI/2018 , ORDER DT. 05.10.2018. XII. SUNIL KUMAR LADHA VS. ITO IN ITA NO.851/KOI/20 18, ORDER DT.05.10.2018. XIII. BALRAM GUPTA VS. ITO IN ITA NO.817/KOI/2018, ORDER DT.05.10.2018. XIV. ALKA CHANGOIWALA VS. ITO IN ITA NO.634/KOI/201 8, ORDER DT.05.10.2018. XV. SANTOSH CHORARIA VS. ITO IN ITA NO.521/KOI/2018 , ORDER DT.05.10.2018. XVI. SONAL BAJAJ VS. ITO IN ITA NO.239/KOI/2018, OR DER DT.05.10.2018. XVII. SUDHA KHANDELWAL V. ITO IN ITA NO.86/KOI/2018 , ORDER DT. 05.10.2018. 23 ITA NO.2387/KOL/2018 NIKHIL PANSARI, AY 2015-16 XVIII. BINA AGARWAL VS. ITO IN ITA NO.1403/KOI/2018 , ORDER DT.05.1 0.2018. XIX. HARISH JAIN VS. ITO IN ITA NO. 1404/KO1/2018, ORDER DT.05.10.2018. THUS, IT IS NOTED THAT AFORESAID DECISION OF THE HO NBLE SUPREME COURT, HONBLE BOMBAY HIGH COURT AND TRIBUNAL ARE DISTINGUISHABLE AND SO THE RATIO IS NOT APPLICABLE TO THE CASE/CASES IN HAND. FOR THE REASON GIVEN AT PARA 4 TO 20 SUPRA, I AM INCLINED TO ALLOW THE GROUNDS RAISED BY THE ASSESSEE. 21. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS AL LOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 23RD AUGUST , 2019 SD/- (A. T. VARKEY) JUDICIAL MEMBER DATED: 23RD AUGUST, 2019 JD. (SR. PS) COPY OF THE ORDER FORWARDED TO: 1 APPELLANT SHRI NIKHIL PANSARI, 2, WATKINS LANE, HO WRAH-711101 2 RESPONDENT ITO, WARD-48(2), KOLKATA. 3 4 5 CIT(A)-14 , KOLKATA. CIT , KOLKATA DR, KOLKATA BENCHES, KOLKATA / TRUE COPY, BY ORDER, ASSISTANT REGISTRAR/H.O.O. ITAT, KOLKATA BENCHES