Chainroop Bohra., Kolkata V. DCIT CC - XXVII/CAL., Kolkata

ITA 24/KOL/2013

• Counselvise Citation: 2423514 RSA 2013
• Duration Of Justice: 2 year(s) 9 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-10-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2005-2006
• Appeal Filed On: 04-01-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: VIKASH SURANA
• Keywords: Unexplained cash credit; Document seized; Accommodation entries; Documents seized
• Section: 143(3); 147; 131; 68; 148; 132

Judgement Text

I.T.A. NO. 24/KOL./2013, ITA NO. 25/KOL/2013 ITA NO. 26/KOL/2012 ITA NO. 27/KOL/2013 ASSESSMENT YEAR: 2005-2006 PAGE 1 OF 14 IN THE INCOME TAX APPELLATE TRIBUNAL, KOLKATA A BENCH, KOLKATA BEFORE SHRI P.M. JAGTAP, ACCOUNTANT MEMBER AND SHRI S.S. VISWANETHRA RAVI, JUDICIAL MEMBER I.T.A. NO. 24/KOL/ 2013 ASSESSMENT YEAR : 2005-2006 CHAINROOP BOHRA,................................... .................................APPELLANT 1, CHANDNEY CHOWK STREET, KOLKATA-700 072 [PAN : ADBPB 5354 N] -VS.- DEPUTY COMMISSIONER OF INCOME TAX,................. ..................RESPONDENT CENTRAL CIRCLE-XXVII, KOLKATA, 110, SHANTI PALLY, AAYAKAR POORVA, KOLKATA-700 107 & I.T.A. NO. 25/KOL/ 2013 ASSESSMENT YEAR : 2005-2006 BIMLA BOHRA,....................................... ......................................APPELLANT 1, CHANDNEY CHOWK STREET, KOLKATA-700 072 [PAN : ADEPB 2647 P] -VS.- DEPUTY COMMISSIONER OF INCOME TAX,................. ..................RESPONDENT CENTRAL CIRCLE-XXVII, KOLKATA, 110, SHANTI PALLY, AAYAKAR POORVA, KOLKATA-700 107 & I.T.A. NO. 26/KOL/ 2012 ASSESSMENT YEAR : 2005-2006 PRADEEP BOHRA,..................................... ...................................APPELLANT 1, CHANDNEY CHOWK STREET, KOLKATA-700 072 [PAN : ADEPB 2644 Q] -VS.- DEPUTY COMMISSIONER OF INCOME TAX,................. ..................RESPONDENT CENTRAL CIRCLE-XXVII, KOLKATA, 110, SHANTI PALLY, AAYAKAR POORVA, KOLKATA-700 107 I.T.A. NO. 24/KOL./2013, ITA NO. 25/KOL/2013 ITA NO. 26/KOL/2012 ITA NO. 27/KOL/2013 ASSESSMENT YEAR: 2005-2006 PAGE 2 OF 14 & I.T.A. NO. 27/KOL/ 2013 ASSESSMENT YEAR : 2005-2006 ALKA BOHRA,........................................ .......................................APPELLANT 1, CHANDNEY CHOWK STREET, KOLKATA-700 072 [PAN : AEAPB 0809 E] -VS.- DEPUTY COMMISSIONER OF INCOME TAX,................. ..................RESPONDENT CENTRAL CIRCLE-XXVII, KOLKATA, 110, SHANTI PALLY, AAYAKAR POORVA, KOLKATA-700 107 APPEARANCES BY: SHRI VIKASH SURANA, FCA , FOR THE ASSESSEES SHRI DEBASHIS BANERJEE, JCIT, SR. D.R., FOR THE DEPARTMENT DATE OF CONCLUDING THE HEARING : OCTOBER 07, 2015 DATE OF PRONOUNCING THE ORDER : OCTOBER 09, 2015 O R D E R PER SHRI P.M. JAGTAP :- THESE FOUR APPEALS FILED BY THE FOUR ASSESSEES AGAI NST FOUR SEPARATE ORDERS OF LD. COMMISSIONER OF INCOME TAX (APPEALS), CENTRAL-II, KOLKATA, ALL DATED 29.10.2012 INVOLVE A COMMON ISSUE AND THE SAME, THEREFORE, HAVE BEEN HEARD TOGETHER AND ARE BEING DISPOSED OF BY A SINGLE CONSOLIDATED ORDER FOR THE SAKE OF CONVENIENCE. 2. ALL THE FOUR ASSESSEES IN THE PRESENT CASE ARE I NDIVIDUALS, WHO CLAIMED EXEMPTION ON ACCOUNT OF LONG TERM CAPITAL G AIN ARISING FROM THE SALE OF SHARES OF M/S. CONTINENTAL FISCAL MANAGEMEN T LIMITED AND M/S. SWASTIK SECURITIES & FINANCE LIMITED IN THEIR RETUR NS OF INCOME FILED FOR THE YEAR UNDER CONSIDERATION. THE SAID RETURNS FILE D BY ALL THE FOUR ASSESSEES WERE INITIALLY PROCESSED BY THE ASSESSING OFFICER UNDER SECTION 143(1) OF THE INCOME TAX ACT, 1961. A SEARCH AND SE IZURE ACTION UNDER SECTION 132 WAS CONDUCTED IN THE CASE OF ONE SHRI S HYAMSUKHA ON I.T.A. NO. 24/KOL./2013, ITA NO. 25/KOL/2013 ITA NO. 26/KOL/2012 ITA NO. 27/KOL/2013 ASSESSMENT YEAR: 2005-2006 PAGE 3 OF 14 24.10.2006. DURING THE COURSE OF THE SAID ACTION, C ERTAIN DOCUMENTS WERE FOUND AND SEIZED FROM THE RESIDENCE OF SHRI SHYAMSU KHA IDENTIFIED AS PAGES 7 TO 10 OF ANNEXURE-A INDICATING THAT CASH OF VARIOUS PERSONS INCLUDING THE FOUR ASSESSEES IN THE PRESENT CASE WA S CONVERTED INTO CHEQUE BY WAY OF THE ALLEGED ACCOMMODATION ENTRIES IN THE FORM OF PURCHASE AND SALE OF SHARES IN ORDER TO CLAIM THE B OGUS LONG-TERM CAPITAL GAIN AND THIS POSITION WAS ACCEPTED EVEN BY SHRI SH YAMSUKHA IN HIS STATEMENT RECORDED UNDER SECTION 132(4) OF THE ACT. HE ALSO ADMITTED OF HAVING ACTED AS AN INTERMEDIARY TO GENERATE ALL THE SE BOGUS TRANSACTIONS FOR EARNING CERTAIN COMMISSION. ON THE BASIS OF THE SE FINDINGS OF THE SEARCH CONDUCTED IN THE CASE OF SHRI SHYAMSUKHA, AS SESSMENTS IN THE CASE OF ALL THE FOUR ASSESSEES WERE REOPENED BY THE ASSE SSING OFFICER AND HE ISSUED NOTICES UNDER SECTION 148 TO ALL THE FOUR AS SESSEES ON 20.12.2007 AFTER RECORDING THE REASONS. IN REPLY, ALL THE FOUR ASSESSEES STATED THAT THE RETURNS ORIGINALLY FILED BY THEM MAY BE TREATED AS THE RETURNS FILED IN RESPONSE TO THE NOTICES ISSUED UNDER SECTION 148. D URING THE COURSE OF ASSESSMENT PROCEEDINGS, ALL THE FOUR ASSESSEES DENI ED OF HAVING ANY CONNECTION WITH SHRI SHYAMSUKHA. THE DIRECTOR OF M/ S. AHILYA COMMERCIAL PVT. LIMITED, WHICH HAD ACTED AS A BROKE R IN THE ALLEGED BOGUS TRANSACTIONS OF PURCHASE AND SALE OF SHARES A LSO DENIED TO HAVE KNOWN SHRI SHYAMSUKHA IN THE STATEMENT RECORDED UND ER SECTION 131. IT WAS, HOWEVER, NOTED BY THE ASSESSING OFFICER THAT T HE SAID BROKER FIRM WAS ALSO SUBJECTED TO A SEARCH ACTION IN DECEMBER, 2005, DURING THE COURSE OF WHICH UNDISCLOSED INCOME OF RS.65,00,000/ - WAS SURRENDERED BY IT ON ACCOUNT OF RECEIPT OF COMMISSION FOR RAIS ING BOGUS LONG-TERM CAPITAL GAIN FOR ITS CLIENTS. HE ALSO NOTED THAT TH E DETAILS OF SHARE TRANSACTIONS AS FOUND RECORDED IN THE RELEVANT DOCU MENTS SEIZED FROM THE RESIDENCE OF SHRI SHYAMSUKHA WERE TALLYING WITH THE TRANSACTIONS DECLARED BY ALL THE FOUR ASSESSEES IN THEIR RETURNS OF INCOME WHILE CLAIMING EXEMPTION ON ACCOUNT OF LONG TERM CAPITAL GAIN. HE ALSO TOOK NOTE OF THE FACT THAT BOTH THE COMPANIES, NAMELY M/ S. CONTINENTAL FISCAL I.T.A. NO. 24/KOL./2013, ITA NO. 25/KOL/2013 ITA NO. 26/KOL/2012 ITA NO. 27/KOL/2013 ASSESSMENT YEAR: 2005-2006 PAGE 4 OF 14 MANAGEMENT LIMITED AND M/S. SWASTIK SECURITIES & FI NANCE LIMITED DID NOT PERFORM THAT WELL DURING THE RELEVANT PERIOD SO AS TO ENCOURAGE THE ASSESSEES TO MAKE INVESTMENT IN THEIR SHARES AND TO JUSTIFY THE LONG TERM CAPITAL GAIN CLAIMED TO BE EARNED BY THEM. HE ALSO FOUND IT TO BE VERY STRANGE THAT THE ASSESSEES DID NOT MAKE FURTHER INV ESTMENT IN THE SAID SHARES EVEN AFTER HAVING EARNED ASTRONOMICAL RETURN S BY WAY OF LONG TERM CAPITAL GAIN. 3. BASED ON HIS FINDINGS/OBSERVATIONS AS NOTED ABOV E, THE ASSESSING OFFICER REQUIRED THE ASSESSEES TO EXPLAIN AS TO WHY THEIR CLAIM OF LONG TERM CAPITAL GAIN ARISING FROM THE SALE OF SHARES O F THE TWO COMPANIES SHOULD NOT BE TREATED AS BOGUS AND THE CORRESPONDIN G AMOUNTS SHOULD NOT BE ADDED TO THEIR TOTAL INCOME AS UNEXPLAINED CASH CREDITS IN TERMS OF SECTION 68 OF THE ACT. IN REPLY, THE FOLLOWING EXPL ANATION WAS OFFERED BY THE ASSESSEES :- 1. DURING THE COURSE OF DEPOSITION/STATEMENT MADE U/S 131 OF THE I.T. ACT, 1961 IN THE ABOVE MENTIONED P ROCEEDING BEFORE YOUR HONOUR, I HAD CLEARLY STATED THAT THERE WAS NO BUSINESS /FINANCIAL RELATION WHATSOEVER WITH MR. NA RENDRA KUMAR SHYAMSUKHA. NEITHER I KNOW HIM PERSONALLY. FU RTHER THE DIRECTORS OF AHILYA COMMERCIAL PVT. LTD. ARE NE ITHER RELATED TO ME NOR I KNOW THEM PERSONALLY. 2. NO CASH WAS CONVERTED INTO CHEQUE BY WAY OF TRAD ING IN SHARES OF CONTINENTAL FISCAL MANAGEMENT LTD., SW ASTIK SECURITIES & FINANCE LTD. AS MENTIONED BY YOUR HONO UR IN THE ABOVE MENTIONED NOTICE. I HAVE NEVER PAID ANY C ASH TO A PERSON CALLED NARENDRA KUMAR SHYAMSUKHA. THIS FACT WAS DULY NARRATED BY MYSELF DURING THE PROCEEDING U/S 1 31 OF THE I.T. ACT, 1961. 3. THE LONG TERM CAPITAL GAIN EARNED BY ME ON THESE TRANSACTION ARE DULY SUPPORTED BY CONTRACT NOTES/BI LLS (DULY SUBMITTED) AND ARE MADE THROUGH RECOGNIZED STOCK EXCHANGE WHICH CAN BE VERIFIED. ALL THE TRANSACTION S WERE MADE THROUGH A/C PAYEE CHEQUE ONLY. THE CONDITIONS TO BE SATISFIED FOR A TRANSACTION TO BE LONG TERM CAPITAL GAIN ARE FULLY MADE. I.T.A. NO. 24/KOL./2013, ITA NO. 25/KOL/2013 ITA NO. 26/KOL/2012 ITA NO. 27/KOL/2013 ASSESSMENT YEAR: 2005-2006 PAGE 5 OF 14 4. IN ORDER TO MAKE INVESTMENT IN SHARE MARKET IT D OES NOT MEAN THAT ONE HAS TO INVEST IN THOSE COMPANIES WHICH ARE MEDIA FRIENDLY OR ARE REGULARLY MENTIONED IN NE WSPAPER. THERE ARE SO MANY LISTED COMPANIES WHO HAVE GIVEN HANDSOME/MINDBODDLING RETURN TO THE INVESTOR WHOM W E HAVE NEVER HEARD OF. FURTHER, IT ENTIRELY DEPEND ON THE INVESTOR (I) WHEN TO INVEST, (II) WHERE TO INVEST, (III) HOW MUCH TO INVEST. IT IS NOT NECESSARY THAT ONE MUST R EGULARLY INVEST IN THE SAME STOCK EVEN IF HE/SHE GETS HANDSO ME RETURN IN THAT. IT ALL DEPENDS ON THE INVESTMENT OP PORTUNITY AVAILABLE AT THAT PARTICULAR TIME IN THE STOCK MARK ET. 5. YOUR HONOUR, I HAVE EARNED LONG TERM CAPITAL GAI N ON THOSE 2 COMPANIES SHARES WHICH ARE DISCLOSED FULLY . ALL THE RELEVANT PAPERS/ SUBMISSION AS DESIRED HAVE DULY BE EN FURNISHED TO YOU. ONLY ON THE BASIS OF THE STATEMEN T GIVEN BY THE SO CALLED MR. NARENDRA KUMAR SHYAMSUKHA AND THE DISCLOSURE MADE BY HIM AS WELL AS THE DIRECTORS OF M/S. AHILYA COMMERCIAL PVT. LTD., THE TRANSACTION SHOULD NEVER BE TERMED AS BOGUS AND SHOULD NOT BE ADDED TO MY TOTAL INCOME AS UNEXPLAINED CASH CREDIT IN TERMS OF SECTION 68 O F THE I.T. ACT. THEREFORE, ON THE BASIS OF THE ABOVE MENTIONED FAC T, THE PROCEEDING INITIATED U/S. 147 MAY PLEASE BE DRO PPED. 4. THE ABOVE EXPLANATION OF THE ASSESSEES WAS NOT F OUND ACCEPTABLE BY THE ASSESSING OFFICER. ACCORDING TO HIM, IF THE ASS ESSEES WERE NOT KNOWN TO SHRI SHYAMSUKHA, HOW IT COULD BE POSSIBLE THAT P APERS SHOWING TRANSACTIONS IN SHARES MADE BY THE ASSESSEES WERE F OUND FROM HIS POSSESSION. HE ALSO FOUND IT DIFFICULT TO COMPREHEN D THAT IF AT ALL THERE WERE NO SUCH ACCOMMODATION/ BOGUS TRANSACTIONS MADE BY THE ASSESSEES OF PURCHASE AND SALE OF SHARES THROUGH SHRI SHYAMSU KHA, WHY DID HE ADMIT TO HAVE EARNED COMMISSION INCOME FROM SUCH TR ANSACTIONS AND ALSO OFFERED THE SAME FOR TAX. HE ALSO FOUND FROM THE EN QUIRY CONDUCTED THROUGH INSPECTOR THAT M/S. JIT SOFTWARE SOLUTIONS PVT. LIMITED STATED TO BE THE PURCHASER OF THE SHARES DID NEVER EXIST AT T HE ADDRESS PROVIDED BY THE BROKER. ON THE BASIS OF THESE ADVERSE FINDINGS, THE ASSESSING OFFICER ARRIVED AT A CONCLUSION THAT SHRI SHYAMSUKHA THROUG H M/S. AHILYA I.T.A. NO. 24/KOL./2013, ITA NO. 25/KOL/2013 ITA NO. 26/KOL/2012 ITA NO. 27/KOL/2013 ASSESSMENT YEAR: 2005-2006 PAGE 6 OF 14 COMMERCIAL PVT. LIMITED HAD PROVIDED ACCOMMODATION ENTRIES TO THE ASSESSEES FOR CLAIMING EXEMPTION ON ACCOUNT OF BOGU S LONG TERM CAPITAL GAIN AND ACCORDINGLY THE AMOUNTS OF SUCH ALLEGED BO GUS LONG TERM CAPITAL GAIN WERE ADDED BY HIM TO THE TOTAL INCOME OF THE A SSESSEES TREATING THE SAME AS UNEXPLAINED CASH CREDITS UNDER SECTION 68 I N THE ASSESSMENTS COMPLETED UNDER SECTION 143(3) READ WITH SECTION 1 47 VIDE ORDERS DATED 31.12.2008. 5. AGAINST THE ORDERS PASSED BY THE ASSESSING OFFIC ER UNDER SECTION 143(3) READ WITH SECTION 147, APPEALS WERE PREFERRE D BY ALL THE FOUR ASSESSEES BEFORE THE LD. CIT(APPEALS). DURING THE C OURSE OF APPELLATE PROCEEDINGS BEFORE THE LD. CIT(APPEALS), IT WAS POI NTED OUT THAT ALL THE SHARES OF THE TWO COMPANIES, VIZ. M/S. CONTINENTAL FISCAL MANAGEMENT LIMITED AND M/S. SWASTIK SECURITIES & FINANCE LIMIT ED, WERE PURCHASED BY THE ASSESSEES THROUGH THE STOCK BROKER IN FINANC IAL YEAR 2002-03 BY MAKING PAYMENT THROUGH ACCOUNT PAYEE CHEQUES. IT W AS ALSO POINTED OUT THAT THE INVESTMENT MADE IN THE SAID SHARES WAS DUL Y REFLECTED IN THE BALANCE-SHEETS OF THE ASSESSEES AS ON 31.03.2003 AN D 31.03.2004 BEFORE THE SALE OF THE CORRESPONDING SHARES IN FINANCIAL Y EAR 2004-05. IT WAS ALSO BROUGHT TO THE NOTICE OF THE LD. CIT(APPEALS) THAT THE SALE PROCEEDS OF THE SAID SHARES WERE RECEIVED BY THE ASSESSEES THROUGH ACCOUNT PAYEE CHEQUES AND ALL THESE TRANSACTIONS OF PURCHASE AND SALE OF SHARES WERE DULY SUPPORTED BY THE CONTRACT NOTES ISSUED BY THE CONCERNED BROKER. IT WAS CONTENDED THAT THIS DIRECT EVIDENCE AVAILABLE O N RECORD SHOWING THE GENUINENESS OF THE TRANSACTIONS IN SHARES, HOWEVER, WAS IGNORED BY THE ASSESSING OFFICER AND THE CLAIM OF THE ASSESSEES FO R LONG TERM CAPITAL GAIN WAS HELD TO BE BOGUS BY HIM ON THE BASIS OF STATEME NT OF THIRD PERSON, WHO WAS NOT EVEN KNOWN TO THE ASSESSEES. IT WAS SUB MITTED THAT EVEN DURING THE COURSE OF SEARCH, NO EVIDENCE WHATSOEVER WAS FOUND FROM THE POSSESSION OF SHRI SHYAMSUKHA, WHICH COULD PROVE TH AT THE ASSESSEES HAD PAID ANY CASH TO HIM FOR CONVERTING INTO CHEQUES AS ALLEGED BY THE I.T.A. NO. 24/KOL./2013, ITA NO. 25/KOL/2013 ITA NO. 26/KOL/2012 ITA NO. 27/KOL/2013 ASSESSMENT YEAR: 2005-2006 PAGE 7 OF 14 ASSESSING OFFICER. IT WAS ALSO SUBMITTED THAT THE B ROKERS NAME AS APPEARED IN THE RELEVANT DOCUMENTS WAS M/S. ASHIKA WITH WHOM THE ASSESSEES, IN FACT, HAD NOT DONE ANY TRANSACTION OF SHARES. IT WAS ARGUED THAT THE ASSESSING OFFICER ALSO DID NOT ALLOW ANY O PPORTUNITY TO THE ASSESSEES TO CROSS EXAMINE SHRI SHYAMSUKHA AND, THE REFORE, NO ADVERSE INFERENCE COULD BE DRAWN AGAINST THE ASSESSEES MERE LY ON THE BASIS OF DECLARATION OF SOME COMMISSION INCOME BY THE SAID T HIRD PERSON. IT WAS CONTENDED THAT THE GENUINENESS OF THE CLAIM OF THE ASSESSEES FOR LONG TERM CAPITAL GAIN WAS DULY SUPPORTED BY A DIRECT EV IDENCE IN THE FORM OF BROKERS NOTE AND PAYMENTS MADE THROUGH ACCOUNT PAY EE CHEQUES AT THE RELEVANT TIME AND THE ADDITIONS MADE BY THE ASSESSI NG OFFICER BY TREATING THE SAME AS BOGUS BY INVOKING THE PROVISIONS OF SEC TION 68, WERE NOT SUSTAINABLE. 6. THE LD. CIT(APPEALS) DID NOT FIND MERIT IN THE S UBMISSIONS MADE ON BEHALF OF THE ASSESSEES AND PROCEEDED TO CONFIRM TH E ADDITIONS MADE BY THE ASSESSING OFFICER UNDER SECTION 68 TREATING THE LONG TERM CAPITAL GAIN SHOWN BY THE ASSESSEES AS BOGUS FOR THE FOLLOWING R EASONS GIVEN IN PARAGRAPH 5.2 OF HIS IMPUGNED ORDER:- ON CAREFUL CONSIDERATION OF FACTS, I AM NOT INCLIN ED TO AGREE WITH THE SUBMISSION OF THE APPELLANT THAT THE DOCUMENTS SEIZED FROM THE POSSESSION OF MR. SHYAMSU KHA HAVE NO EVIDENTIARY VALUE OR THAT THERE IS NO DIREC T EVIDENCE THAT THE APPELLANT HAD PAID THE CASH IN LIEU OF CHE QUE RECEIVED FOR SALE OF SHARES. AS PER THE PROVISIONS OF SECTION 292C OF THE ACT, WHERE ANY BOOKS OF ACCOUNT OR OTHE R DOCUMENTS ARE FOUND IN THE POSSESSION OR CONTROL OF ANY PERSON IN THE COURSE OF SEARCH OR SURVEY, IT MAY, I N ANY PROCEEDING UNDER THE ACT, BE PRESUMED THAT SUCH BOO KS OF ACCOUNT AND OTHER DOCUMENTS ARE TRUE. IN THIS CASE, SEARCH OPERATION WAS CONDUCTED IN THE PREMISES OF SHRI NAR ENDRA SHYAMSUKHA AND IN THE COURSE OF SEARCH PAGE NOS. 7 TO 10 WERE SEIZED AS PER BUNDLE NO. NKS/3. AT THE TIME OF SEARCH, IN THE STATEMENT, IT WAS STATED BY SHRI SHYAMSUKHA THAT THE TRANSACTIONS NOTED ON THESE PAPERS ARE ON ACCOUNT OF BOGUS LONG TERM CAPITAL GAIN. NOW, AS PER THE PROVISIONS OF SECTION 292C, THE FIRST PRESUMPTION IS THAT THE SAID SEIZED PAPERS I.T.A. NO. 24/KOL./2013, ITA NO. 25/KOL/2013 ITA NO. 26/KOL/2012 ITA NO. 27/KOL/2013 ASSESSMENT YEAR: 2005-2006 PAGE 8 OF 14 BELONG TO SHRI SHYAMSUKHA AND THE NOTING MADE ON TH ESE PAPERS ARE TRUE. HOWEVER, ON THE BASIS OF THIS PRES UMPTION, IT CANNOT BE CONCLUDED THAT THE TRANSACTIONS OF SHA RES NOTED ON THESE PAPERS PERTAIN TO SHRI SHYAMSUKHA BECAUSE HE HAD NOT DISCLOSED ANY LONG TERM CAPITAL GAIN ON SALE OF SHARES AS NOTED ON THE SEIZED PAPERS AND, THEREFORE, IT CANNO T BE CONCLUDED THAT THE CASH AS PER THE SEIZED PAPER WA S PAID BY SHRI SHYAMSUKHA. ON THE CONTRARY, ALL THE PERSONS I NCLUDING THE APPELLANT, AGAINST WHOSE NAME SHARE TRANSACTION S ARE WRITTEN IN THE SEIZED PAPERS, HAD DISCLOSED THE SAM E AMOUNT OF LONG TERM CAPITAL GAIN IN THEIR RESPECTIVE RETUR N OF INCOME. IT MEANS THAT THE TRANSACTIONS OF SHARES RE CORDED ON THE SEIZED DOCUMENTS ARE TRUE AND THE BENEFICIAR IES ARE THOSE PERSONS WHOSE NAMES ARE WRITTEN ON THE SEIZED DOCUMENTS. THE DETAILS/ DATES OF PURCHASE AND SALE OF SHARES WRITTEN ON THE SEIZED PAPERS MATCH WITH THE DETAILS FURNISHED BY THE APPELLANT IN THE COURSE OF APPELLA TE PROCEEDINGS AS WELL AS DECLARED IN THE RETURN OF IN COME. THUS, IT WILL NOT BE CORRECT TO SAY THAT THE SEIZED DOCUMENTS HAVE NO EVIDENTIARY VALUE. AS PER THE SEIZED PAPER S THE BENEFICIARIES WHOSE NAMES ARE WRITTEN ON THE SEIZED PAPERS INCLUDING THE APPELLANT, HAD PAID THE CASH TO ARRAN GE THE BOGUS LONG TERM CAPITAL GAIN. THIS FACT CANNOT BE D ENIED OR OVERLOOKED. THE APPELLANT HAS ARGUED THAT IT IS ON MR. SHYAMSUKHA TO EXPLAIN AS TO WHY HE HAS KEPT THE DET AILS OF APPELLANTS SHARE TRANSACTIONS CARRIED ON THROUGH T HE BROKER BECAUSE THE APPELLANT DO NOT HAVE ANY RELATI ON AT ALL WITH THIS PERSON AND DID NOT PAY ANY AMOUNT OF CASH TO HIM. ON CAREFUL CONSIDERATION OF FACTS, I FIND NO SUBSTA NCE IN THIS ARGUMENT OF THE APPELLANT. SHRI SHYAMSUKHA WAS HAVI NG DETAILS OF SHARE TRANSACTION OF ALL THOSE PERSONS I NCLUDING THE APPELLANT IN WHOSE CASES HE HAD ACTED AS AN INTERMEDIARY TO FACILITATE THE TRANSACTIONS OF BOGU S CAPITAL GAIN. OTHERWISE, THERE IS NO REASON THAT A THIRD PE RSON WOULD KEEP THE DETAILS OF SHARE TRANSACTIONS OF NON - INTERESTED PERSONS. IT IS NOT THE CASE THAT SHRI SH YAMSUKHA WAS HAVING ANY ANIMOSITY WITH THE APPELLANT OR FOR THAT MATTER WITH OTHER PERSONS THAT HE WOULD KEEP INCRIM INATING DETAILS OF SHARE TRANSACTIONS IN THE NAME OF THESE PERSONS WITH THE HOPE THAT SEARCH OPERATION U/S 132 WOULD B E CONDUCTED IN HIS CASE AND HE WOULD HANDOVER SUCH DE TAILS TO THE TAX DEPARTMENT. HE WAS HAVING THE DETAILS OF SH ARES OF ALL THE PERSONS AS PER THE SEIZED DOCUMENTS BECAUSE HE WAS INVOLVED IN FACILITATING THE ACCOMMODATION ENTRIES OF LONG TERM CAPITAL GAIN ON BEHALF OF ALL THE BENEFICIARIE S MENTIONED IN THE SEIZED DOCUMENTS. I ALSO DO NOT FO UND ANY I.T.A. NO. 24/KOL./2013, ITA NO. 25/KOL/2013 ITA NO. 26/KOL/2012 ITA NO. 27/KOL/2013 ASSESSMENT YEAR: 2005-2006 PAGE 9 OF 14 MERIT IN THE SUBMISSION OF THE APPELLANT THAT THERE IS NO DIRECT EVIDENCE THAT ANY AMOUNT OF CASH WAS PAID BY THE APPELLANT. I AM OF THE OPINION THAT THERE COULD NOT BE ANY EYE WITNESS FOR THIS, BUT, THERE ARE DOCUMENTARY AN D CIRCUMSTANTIAL EVIDENCES THAT THE APPELLANT HAD PAI D CASH TO OBTAIN ENTRY OF LONG TERM CAPITAL GAIN. IT IS AN OP EN SECRET THAT DURING THE FINANCIAL YEARS 2002-03, 2003-04 AN D 2004- 05, ETC. THE PRACTICE OF TAKING ACCOMMODATION ENTRI ES OF LONG TERM CAPITAL GAIN WAS RAMPANT IN KOLKATA. THUS , THE DOCUMENTS SEIZED FROM THE POSSESSION OF SHRI SHYAMS UKHA CANNOT BE IGNORED OR CANNOT BE TREATED AS WASTE PIE CES OF PAPER. THE APPELLANT HAS ALSO ARGUED THAT THE NAME OF THE BROKER WRITTEN ON THE SEIZED PAPER IS DIFFERENT THA N THE BROKER THROUGH WHOM SHARES WERE PURCHASED AND SOLD. I AM OF THE OPINION THAT IT MIGHT BE POSSIBLE BECAUSE IN THIS ACTIVITY SEVERAL PERSONS AND SEVERAL BROKERS WERE I NVOLVED. BUT, IN ANY CASE, IT DOES NOT MEAN THAT THE TRANSAC TIONS NOTED ON THE SEIZED PAPERS ARE NOT TRUE. THE APPELL ANT HAS RELIED ON VARIOUS JUDICIAL DECISIONS, BUT THEY ARE DISTINGUISHABLE ON FACTS AND NONE OF THE DECISION I S APPLICABLE TO THE FACTS OF THE APPELLANT. IN VIEW O F ABOVE, IT IS HELD THAT THE AO WAS JUSTIFIED IN MAKING ADDITIO N U/S 68 OF THE ACT. THE ADDITION MADE BY THE AO IS CONFIRME D. THE GROUND NOS. 2 TO 5 ARE DISMISSED. AGGRIEVED BY THE ORDERS OF THE LD. CIT(APPEALS), TH E ASSESSEES HAVE PREFERRED THESE APPEALS BEFORE THE TRIBUNAL. 7. THE LD. COUNSEL FOR THE ASSESSES, AT THE OUTSET, SUBMITTED THAT THERE WERE 13 PERSONS IN WHOSE CASES SIMILAR ADDITIONS WE RE MADE BY THE ASSESSING OFFICER UNDER SECTION 68 BY TREATING THEI R CLAIM OF LONG TERM CAPITAL GAIN ARISING FROM SALE OF SHARES AS BOGUS B Y RELYING ON THE FINDINGS OF SEARCH ACTION CONDUCTED IN THE CASE OF SHYAMSUKHA. HE SUBMITTED THAT ALL THESE THIRTEEN PERSONS DISPUTED THE SAID ADDITIONS MADE BY THE ASSESSING OFFICER UNDER SECTION 68 BY F ILING THE APPEALS BEFORE THE LD. CIT(APPEALS) AND WHEN THE LD. CIT(AP PEALS) CONFIRMED THE SAID ADDITIONS IN CASE OF THREE ASSESSES, NAMELY LA TE MRS. KAMALA DEVI AGARWAL (L/R. SHRI ASHOK KUMAR GUPTA), MR. ASHOK KU MAR GUPTA AND MRS. AMITA GUPTA, APPEALS WERE PREFERRED BY THE SAID THR EE ASSESSEES BEFORE I.T.A. NO. 24/KOL./2013, ITA NO. 25/KOL/2013 ITA NO. 26/KOL/2012 ITA NO. 27/KOL/2013 ASSESSMENT YEAR: 2005-2006 PAGE 10 OF 14 THE TRIBUNAL. HE SUBMITTED THAT THE SMC BENCH OF THIS TRIBUNAL HAS ALREADY DISPOSED OF THE SAID APPEALS VIDE ITS APPEL LATE ORDER DATED 02.06.2015 PASSED IN ITA NOS. 500-502/KOL/2013 ACCE PTING THE GENUINENESS OF THE SIMILAR CLAIM OF THE SAID THREE ASSESSEES OF LONG TERM CAPITAL GAIN ARISING FROM THE SIMILAR TYPE OF TRANS ACTIONS. HE CONTENDED THAT THE COMMON ISSUE INVOLVED IN THE CASE OF THE P RESENT FOUR ASSESSES THUS IS SQUARELY COVERED IN FAVOUR OF THE ASSESSEES BY THE SAID DECISION OF THE TRIBUNAL RENDERED ON 02.06.2015, WHEREIN A SIMI LAR ISSUE HAS BEEN DECIDED BY THE TRIBUNAL IN FAVOUR OF THE ASSESSEES INVOLVING SIMILAR FACTS AND CIRCUMSTANCES OF THE CASE. 8. LD. D.R., ON THE OTHER HAND, HAS NOT BEEN ABLE T O SHOW THAT THERE IS ANY MATERIAL DISTINCTION IN THE FACTS INVOLVED IN T HE PRESENT CASE AS COMPARED TO THE FACTS INVOLVED IN THE CASE OF LATE MRS. KAMALA DEVI AGARWAL (L/R. SHRI ASHOK KUMAR GUPTA) IN ITA NO. 50 0/KOL/2013, MR. ASHOK KUMAR GUPTA IN ITA NO. 501/KOL/2013 AND MRS. AMITA GUPTA IN ITA NO. 502/KOL/2013, DECIDED BY THE TRIBUNAL VIDE ITS ORDER DATED 02/06/2015, WHEREIN A SIMILAR ISSUE HAS BEEN DECIDE D BY THE TRIBUNAL IN FAVOUR OF THE ASSESSEES. HE, HOWEVER, SUBMITTED THA T THERE ARE VARIOUS FACTORS BROUGHT ON RECORD BY THE ASSESSING OFFICER WHICH CLEARLY INDICATE THAT THE TRANSACTIONS OF PURCHASE OF SHARES CLAIMED TO BE MADE BY THE ASSESSEES WERE ACCOMMODATION ENTRIES AND CAPITAL GA IN ARISING FROM SUCH TRANSACTIONS WAS BOGUS. HE INVITED OUR ATTENTION TO THE RELEVANT PORTION OF THE ASSESSMENT ORDER IN ORDER TO HIGHLIGHT SUCH FACTORS AS UNDER:- (I) THE DETAILS FOUND RECORDED IN THE RELEVANT DOCU MENTS SEIZED FROM THE POSSESSION OF SHRI SHYAMSUKHA RELATING TO THE PURCHASE AND SALE OF TRANSACTIONS EXACTLY TALLIED WITH THE T RANSACTIONS DECLARED BY THE ASSESSEES IN SUPPORT OF THEIR CLAIM FOR LONG TERM CAPITAL GAIN. I.T.A. NO. 24/KOL./2013, ITA NO. 25/KOL/2013 ITA NO. 26/KOL/2012 ITA NO. 27/KOL/2013 ASSESSMENT YEAR: 2005-2006 PAGE 11 OF 14 (II) SHRI SHYAMSUKHA ADMITTED THAT ALL THESE TRANSA CTIONS WERE ACCOMMODATION ENTRIES GIVEN BY THE CONCERNED BROKER IN ORDER TO FACILITATE THE CONCERNED PERSONS INCLUDING THE ASSE SSEES TO CLAIM BOGUS LONG TERM CAPITAL GAIN. (III) SHRI SHYAMSUKHA ALSO ADMITTED OF HAVING EARNE D COMMISSION FOR HELPING THE ASSESSEES TO GET THE ACCOMMODATION ENTRIES FROM THE CONCERNED BROKER AND OFFERED SUCH COMMISSION AS INC OME TO TAX. (IV) THE TWO COMPANIES WHOSE SHARES WERE CLAIMED TO BE PURCHASED AND SOLD BY THE ASSESSEES GIVING RISE TO THE SUBSTANTIAL AMOUNT OF CAPITAL GAIN HAD NO CREDENTIAL AND EVEN A FTER EARNING EXORBITANT PROFIT IN THE SAID SHARES, THE ASSESSEES NEVER MADE ANY FURTHER INVESTMENT IN THE SAID SHARES. (V) THE BROKER THROUGH WHOM THE TRANSACTIONS IN QUE STION OF PURCHASE AND SALE OF SHARES WERE MADE BY THE ASSESS EES GOT SUSPENDED SUBSEQUENTLY BY THE STOCK EXCHANGE FOR IN DULGING INTO UNFAIR PRACTICES. (VI) THE PARTY TO WHOM SHARES WERE CLAIMED TO BE SO LD BY THE ASSESSEES WAS NOT FOUND IN EXISTENCE AT THE ADDRESS GIVEN. 9. LD. D.R. CONTENDED THAT ALL THE ABOVE FACTORS BR OUGHT ON RECORD BY THE ASSESSING OFFICER WERE SUFFICIENT TO INDICATE T HAT THE RELEVANT TRANSACTIONS OF PURCHASE AND SALE OF SHARES WERE NO THING BUT ACCOMMODATION ENTRIES AND THE CAPITAL GAIN ARISING FROM THE SAME CLAIMED AS EXEMPT BY THE ASSESSEES WAS BOGUS. HE CO NTENDED THAT ALL THESE FACTORS BROUGHT ON RECORD BY THE ASSESSING OF FICER ARE CLEARLY ABNORMAL AND THIS ABNORMALITY LEADS TO THE CONCLUSI ON THAT THE CLAIM OF THE ASSESSEES FOR LONG TERM CAPITAL GAIN WAS BOGUS. HE CONTENDED THAT THIS I.T.A. NO. 24/KOL./2013, ITA NO. 25/KOL/2013 ITA NO. 26/KOL/2012 ITA NO. 27/KOL/2013 ASSESSMENT YEAR: 2005-2006 PAGE 12 OF 14 ABNORMALITY, HOWEVER, HAS NOT BEEN APPRECIATED OR C ONSIDERED BY THE TRIBUNAL WHILE ACCEPTING THE CLAIM OF THE ASSESSEES FOR LONG TERM CAPITAL GAIN IN THE CASE OF LATE MRS. KAMALA DEVI AGARWAL ( L/R. SHRI ASHOK KUMAR GUPTA), MR. ASHOK KUMAR GUPTA AND MRS. AMITA GUPTA. 10. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND CA REFULLY PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. IT IS NO DOU BT TRUE THAT THERE ARE VARIOUS FACTORS AS POINTED OUT BY THE ASSESSING OFF ICER AND FURTHER HIGHLIGHTED BY THE LD. D.R., WHICH CREATE A DOUBT A BOUT THE GENUINENESS OF THE CLAIM OF THE ASSESSEES FOR LONG TERM CAPITAL GA IN ARISING FROM THE SALE OF SHARES OF TWO COMPANIES. HOWEVER, THESE FACTORS WERE VERY MUCH THERE EVEN IN THE CASE OF LATE MRS. KAMALA DEVI AGARWAL (L/R. SHRI ASHOK KUMAR GUPTA)IN ITA NO. 500/KOL/2013, MR. ASHOK KUMA R GUPTA IN ITA NO. 501/KOL/2013 AND MRS. AMITA GUPTA IN ITA NO. 50 2/KOL/2013, DECIDED BY THE TRIBUNAL VIDE ITS ORDER DATED 02/06/ 2015 (SUPRA) AND IT CANNOT BE SAID THAT THESE FACTORS HIGHLIGHTED BY TH E ASSESSING OFFICER EVEN IN THE SAID CASES HAVE NOT BEEN CONSIDERED OR APPRECIATED BY THE TRIBUNAL WHILE ACCEPTING THE GENUINENESS OF THE SIM ILAR CLAIM OF THE ASSESSEES FOR THE LONG TERM CAPITAL GAIN. MOREOVER, THESE FACTORS WERE IN THE NATURE OF CIRCUMSTANTIAL EVIDENCE BASED MAINLY ON THE STATEMENT GIVEN BY A THIRD PERSON, WHEREAS THERE WAS A DIRECT EVIDENCE IN THE FORM OF PURCHASE OF SHARES BY THE ASSESSEES IN FINANCIAL YEAR 2002-03 ON PAYMENT MADE BY ACCOUNT PAYEE CHEQUES, THE REFLECTI ON OF THE SAID SHARES AS INVESTMENT IN THE BALANCE-SHEETS OF THE ASSESSEE S AS ON 31.03.2003 AND 31.03.2004 AND SALE OF THE SAID SHARES IN THE FINAN CIAL YEAR 2004-05 BY THE ASSESSEES AGAINST THE PAYMENTS RECEIVED AGAIN B Y ACCOUNT PAYEE CHEQUES. THE CLAIM OF THE ASSESSEES OF THESE TRANSA CTIONS IN PURCHASE AND SALE OF SHARES WAS ALSO DULY SUPPORTED BY THE CONTR ACT NOTES ISSUED BY THE CONCERNED BROKERS. THIS DIRECT EVIDENCE AVAILABLE O N RECORD WAS PREFERABLY RELIED UPON BY THE TRIBUNAL VIDE ITS ORD ER DATED 02/06/2015 IN THE CASE OF LATE MRS. KAMALA DEVI AGARWAL (L/R. SHRI ASHOK KUMA R I.T.A. NO. 24/KOL./2013, ITA NO. 25/KOL/2013 ITA NO. 26/KOL/2012 ITA NO. 27/KOL/2013 ASSESSMENT YEAR: 2005-2006 PAGE 13 OF 14 GUPTA)IN ITA NO. 500/KOL/2013, MR. ASHOK KUMAR GUPT A IN ITA NO. 501/KOL/2013 AND MRS. AMITA GUPTA IN ITA NO. 502/KO L/2013 (SUPRA) OVER THE CIRCUMSTANTIAL EVIDENCE BROUGHT ON RECORD BY THE ASSESSING OFFICER TO COME TO THE CONCLUSION THAT THE RELEVANT TRANSACTIONS OF PURCHASE AND SALE OF SHARES GIVING RISING TO LONG T ERM CAPITAL GAIN TO THE ASSESSES WERE GENUINE TRANSACTIONS AND THE ADDITION S MADE BY THE ASSESSING OFFICER UNDER SECTION 68 BY TREATING THE SAID TRANSACTIONS AS BOGUS WERE NOT SUSTAINABLE. HAVING REGARD TO ALL TH E FACTS AND CIRCUMSTANCES OF THE CASE AND THE MATERIAL AVAILABL E ON RECORD, WE FIND NO JUSTIFIABLE REASON TO TAKE A DIFFERENT VIEW THAN TH E ONE TAKEN BY THE TRIBUNAL IN THE CASE OF LATE MRS. KAMALA DEVI AGARW AL (L/R. SHRI ASHOK KUMAR GUPTA)IN ITA NO. 500/KOL/2013, MR. ASHOK KUMA R GUPTA VIDE ORDER DATED 02/06/2015 (SUPRA) ACCEPTING THE SIMILA R CLAIM OF THE ASSESSEES FOR LONG TERM CAPITAL GAIN IN THE SIMILAR FACTS AND CIRCUMSTANCES. WE, THEREFORE, FOLLOW THE DECISION O F THE SMC BENCH OF THIS TRIBUNAL IN THE CASES OF LATE MRS. KAMALA DEVI AGARWAL (L/R. SHRI ASHOK KUMAR GUPTA) IN ITA NO. 500/KOL/2013, MR. ASH OK KUMAR GUPTA IN ITA NO. 501/KOL/2013 AND MRS. AMITA GUPTA IN ITA NO. 502/KOL/2013 (SUPRA) AND ACCEPT THE CLAIM OF THE ASSESSEES FOR L ONG TERM CAPITAL GAIN AS GENUINE. THE ADDITIONS MADE BY THE ASSESSING OFFICE R UNDER SECTION 68 AND CONFIRMED BY THE LD. CIT(APPEALS) TREATING THE SAID CAPITAL GAIN AS BOGUS, ARE ACCORDINGLY DELETED. 11. IN THE RESULT, ALL THESE FOUR APPEALS OF THE AS SESSEES ARE ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON OCTOBER 9, 20 15. SD/- SD/- (S.S. VISWANETHRA RAVI) (P.M. JAGTAP) JUDICIAL MEMBER ACCOUNTANT MEMBER KOLKATA, THE 9 TH DAY OF OCTOBER, 2015 I.T.A. NO. 24/KOL./2013, ITA NO. 25/KOL/2013 ITA NO. 26/KOL/2012 ITA NO. 27/KOL/2013 ASSESSMENT YEAR: 2005-2006 PAGE 14 OF 14 COPIES TO : (1) CHAINROOP BOHRA, 1, CHANDNEY CHOWK STREET, KOLKATA-700 072 (2) BIMLA BOHRA, 1, CHANDNEY CHOWK STREET, KOLKATA-700 072 (3) PRADEEP BOHRA, 1, CHANDNEY CHOWK STREET, KOLKATA-700 072 (4) ALKA BOHRA, 1, CHANDNEY CHOWK STREET, KOLKATA-700 072 (5) DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE-XXVII, KOLKATA, 110, SHANTI PALLY, AAYAKAR POORVA, KOLKATA-700 107 (6) COMMISSIONER OF INCOME-TAX (APPEALS), CENTRAL - II, KOLKATA (7) COMMISSIONER OF INCOME TAX, KOLKATA (8) THE DEPARTMENTAL REPRESENTATIVE (9) GUARD FILE BY ORDER ASSISTANT REGISTRAR, INCOME TAX APPELLATE TRIBUNAL, KOLKATA BENCHES, KOLKATA LAHA/SR. P.S.