Ankit Nahata, Kolkata V. ITO, Ward 34(2), Kolkata, Kolkata

ITA 2482/KOL/2017

• Counselvise Citation: [2019] 116 COUNSELVISE.COM (IT) 6311 (ITAT-KOLKATA)
• Duration Of Justice: 1 year(s) 7 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-08-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Assessment Year: 2014-2015
• Appeal Filed On: 18-12-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SANKAR HALDER
• Keywords: Unexplained cash credit; Unexplained expenditure; Earning of tax free income; Accommodation entries; TDS
• Section: 69C; 143(3); 143(1); 68; 69

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL C, BENC H KOLKATA BEFORE SHRI A.T.VARKEY, JM &DR. A.L.SAINI, AM ./ITA NO.2482/KOL/2017 ( / ASSESSMENT YEAR:2014-15) ANKIT NAHATA 4 TH FLOOR, ROOM NO. 406, 4, CLIVE ROW, KOLKATA-700001 VS. ITO, WARD-34(2), KOLKATA ./ ./PAN/GIR NO.: AKCPN 7825 J (ASSESSEE) .. (REVENUE) ASSESSEEBY : SHRI RAJEEVA KUMAR, ADVOCATE RESPONDENT BY :SHRI SANKAR HALDER, JCIT SR. DR / DATE OF HEARING : 12/06/2019 /DATE OF PRONOUNCEMENT : 02/08/2019 / O R D E R PER DR. A. L. SAINI: THE CAPTIONED APPEAL FILED BY THE ASSESSEE, PERTAIN ING TO ASSESSMENT YEAR 2014-15, IS DIRECTED AGAINST AN ORDER PASSED BY T HE LEARNED COMMISSIONER OF INCOME TAX (APPEALS)-10, KOLKATA (IN SHORT THE LD. CIT(A)], WHICH IN TURN ARISES OUT OF AN ASSESSMENT ORDER PASSED BY THE ASSESSING OFFICER U/S 143(3) OF THE INCOME TAX ACT, 1961 ( IN SHORT THE ACT) DATED 30 /11/2016. 2. THE GROUNDS OF APPEAL RAISED BY THE ASSESSEE ARE AS FOLLOWS: 1. THAT UNDER THE FACTS & CIRCUMSTANCES OF THE CASE , THE LD. CIT(A) ERRED IN CONFIRMING ADDITION OF A SUM OF RS. 76,46,476/- BEI NG THE SALE PROCEEDS OF SHARES, AS UNEXPLAINED CASH CREDIT U/S 68 OF THE IN COME TAX ACT, 1961. ANKIT NAHATA ITA NO.2482/KOL/2017 ASSESSMENT YEAR:2014-15 P PP PA AA AG GG GE EE E | || | 2 22 2 2. THAT UNDER THE FACTS & CIRCUMSTANCES OF THE CASE , THE LD. CIT(A) ERRED IN HOLDING THAT THE LTCG OF RS. 74,07,805/- CLAIMED BY THE ASSESSEE ON SALE OF 2,00,000 SHARES OF KAILASH AUTO FINANCE LTD. WAS BO GUS. 3. THAT UNDER THE FACTS & CIRCUMSTANCES OF THE CASE , THE LD. CIT(A) ERRED CONFIRMING ADDITION OF A SUM OF RS. 2,29,394/- IN T ERMS OF SECTION 69C OF THE INCOME TAX ACT, 1961 FOR THE COMMISSION ALLEGED LY PAID TO THE BROKER FOR ARRANGING BOGUS CAPITAL GAINS. 4. THAT THE APPELLANT CRAVES LEAVE TO ADD, ALTER, A MEND, MODIFY OR WITHDRAW ANY GROUND OR GROUNDS OF APPEAL OR AT THE TIME OF H EARING. 3. GROUND NOS. 1 AND 2 RAISED BY THE ASSESSEE RELAT E TO THE ADDITION OF RS. 76,46,476/- AS UNEXPLAINED CASH CREDIT U/S 68 OF TH E ACT ON ACCOUNT OFLONG TERM CAPITAL GAIN(LTCG) CLAIMED BY THE ASSESSEE ON SALE OF 2,00,000 SHARES OF KAILASH AUTO FINANCE LTD. 4. BRIEF FACTS QUA THE ISSUE ARE THAT THE ASSESSEE FILED ITS RETURN OF INCOME ON 30.03.2015, DECLARING TOTAL INCOME OF RS. 5,02,440/ -. THE RETURN OF INCOME FILED BY THE ASSESSEE WAS PROCESSED U/S 143(1) OF THE ACT. L ATER ON,IN ORDER TO VERIFY THE CLAIM OF EXEMPT INCOME U/S 10(38) BY WAY OF LONG TE RM CAPITAL GAIN, THE ASSESSEES CASE WAS SELECTED FOR SCRUTINY U/S 143(2 ) OF THE ACT. THE MAJOR REASON FOR SCRUTINY ASSESSMENT WAS SOURCED FROM THE REPORT OF INVESTIGATION WING OF THE DEPARTMENT RELATING TO MISUSE OF STOCK EXCHANGE PLA TFORM FOR EVADING OR AVOIDING LEGITIMATE TAXES. THE ASSESSING OFFICER NOTED THAT THE REPORT OF THE INVESTIGATION WING SPEAKS ABOUT AS MANY AS 84 PENNY STOCK COMPANI ES WHOSE SHARES WERE MANIPULATED OR EXPLOITED TO BOOK EITHER LONG TERM C APITAL GAIN WHICH IS EXEMPT FROM TAX OR SHORT TERM CAPITAL LOSS FOR SET OFF WIT H OTHER NATURE OF INCOME SO AS TO REDUCE THE TAX LIABILITY. THE MODUS OPERANDI INVOLV ES BUYING THE SHARES OF SUCH PENNY STOCK COMPANIES WHEN THE PRICES IS LOW EITHER FROM THE MARKET OR THROUGH DIRECT ALLOTMENT ON FIRST ISSUE AND SUBSEQUENT MERG ER WITH SUCH COMPANIES. THE STOCK IS HELD FOR 12 MONTHS IN WHICH TIME PRICE IS ARTIFICIALLY RAISED TO A SIGNIFICANT LEVEL THE SAID STOCK IS SOLD WITH THE ASSISTANCE OF THE PROMOTERS OF THE COMPANY. THE SEBI AFTER MAKING INTENSIVE INQUIRY INTO MOVE MENT OF PRICE OF SHARES OF SUCH COMPANIES HAVE REACHED TO THE CONCLUSION THAT THE SALE OF SHARES OF SUCH COMPANIES ARE CAMOUFLAGED AS CAPITA GAIN. ANKIT NAHATA ITA NO.2482/KOL/2017 ASSESSMENT YEAR:2014-15 P PP PA AA AG GG GE EE E | || | 3 33 3 5. THE ASSESSING OFFICER NOTED THAT ASSESSEE WAS I NVOLVED IN DEALING IN THE SHARES OF M/S KAILASH AUTO FINANCE SERVICES PVT. LTD. WHI CH IS AMONG THE SEVERAL OTHER COMPANIES. THE INCOME COMPUTATION STATEMENT SHOWS T HAT THE ASSESSEE PURCHASED 2,00,000 SHARES OF M/S PUNCHASHEEL MARKETING LTD. F OR RS. 2,00,000/- ON 05.04.2012. THE SHARES OF M/S PUNCHASHEEL MARKETING LTD. WAS DEMARGED WITH M/S KAILASH AUTO FINANCE LTD. THE 2,00,000 NUMBER O F SHARES OF THE DEMERGED COMPANY WERE CONVERTED TO 2,00,000 SHARES OF THE RE SULTING COMPANY M/S KAILASH AUTO FINANCE LTD. THE SAID 2,00,000 NOS. OF SHARES WERE SOLD FOR RS. 76,46,476/- DURING THE PERIOD FROM 29.07.2013 TO 30.09.2013 IN 7 PHASES GIVING RISE TO PROFIT OF RS.74,46,476/-. IN THE RETURN THE ASSESSEE HAD C LAIMED INCOME OF RS. 74,07,805/- AS EXEMPT FROM TAX U/S 10(38) OF THE AC T. DURING THE ASSESSMENT PROCEEDINGS, THE ASSESSEE SUB MITTED BEFORE THE ASSESSING OFFICER THAT HE HAS EARNED A GENUINE LTCG.HOWEVER A FTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE, THE ASSESSING OFFICER NOTED THAT SEBI AS WELL AS DEPARTMENTAL INVESTIGATION WING WERE IN POSSESSION OF THE DATA FROM THE STOCK EXCHANGE WHICH SHOWS THAT THE PRICE RISE OF THE SH ARE IS THE RESULT OF FREQUENT PURCHASE AND SALE OF SHARES BETWEEN FEW UNSCRUPULOU S BROKERS WHICH WAS AIMED TO ARRANGE PROFIT FROM SALE OF SHARES AT HIGH MARKE T RATE. THOUGH APPARENTLY IT IS SEEN AS NORMAL MARKET RESULTS, IT IS PROVED, BASE D ON CIRCUMSTANTIAL EVIDENCES THAT IT IS MERE CLANDESTINE TRANSACTION. ALL THE FACTS A ND CIRCUMSTANCES SHOW THAT THE ASSESSEES CLAIM OF THE TRANSACTIONS OF PURCHASE A ND SALE OF M/S KAILASH AUTO FINANCE LTD. AS GENUINE HAS FAILED TO QUALIFY IN TH E TEST OF THEORIES OF PREPONDERANCE OF PROBABILITY HELD BY THE HONBLE SU PREME COURT. THE PROBABILITY OF MAKING GAIN IN TRANSACTING THE SHARES OF COMPAN Y WHOSE PRESENCE BEFORE THE GENERAL INVESTORS IN THE MARKET DOES NOT ALLURE THE M TO INVEST, ARE SIGNIFICANTLY LESS. THE THEORY OF PROBABILITY SUGGESTS THAT HUMAN INSTINCT IS NOT INCLINED TO BE INVOLVED IN ANY DEAL WHERE CHANCE TO WIN IS NOT FAV OURABLE IN HONEST PERCEPTION. THEREFORE, AO HELD THAT ASSESSEE HAD TRIED TO AVOID LEGITIMATE TAXES BY MISUSING THE STOCK EXCHANGE PLATFORM AND THE STATEMENT OF SH RI SUNIL DOKANIA, IN THE ANSWER TO Q. NO. 25 IT WAS OBSERVED THAT COMMISSION @ 3% HAS BEEN CHARGED BY THE BROKER FOR PROVIDING ARRANGED CAPITAL GAINS TO VARIOUS PARTIES. AS THE ASSESSEE WAS ONE OF THE BENEFICIARIES AND LTCG OF RS. 74,46, 476/- WAS ARRANGED FROM SALE ANKIT NAHATA ITA NO.2482/KOL/2017 ASSESSMENT YEAR:2014-15 P PP PA AA AG GG GE EE E | || | 4 44 4 PRICE OF RS. 76,46,476/- WHICH IS A CONCOCTED TRANS ACTION, THEREFORE, AO MADE ADDITION OF RS. 76,46,476/- UNDER SECTION 68 OF THE ACT. THE AO ALSO MADE ADDITION OF RS. 2,29,394/- (I.E. 3% OF RS. 76,46,47 6/-), AS UNDISCLOSED COMMISSION EXPENSES U/S 69C OF THE ACT. 6. AGGRIEVED BY THE ORDER OF THE ASSESSING OFFICER, THE ASSESSEE CARRIED THE MATTER IN APPEAL BEFORE THE LD. CIT(A) WHO HAS CONFIRMED T HE ADDITION MADE BY THE ASSESSING OFFICER. AGGRIEVED BY THE ORDER OF THE LD . CIT(A) THE ASSESSEE IS IN APPEAL BEFORE US. 7. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE M ATERIAL AVAILABLE ON RECORD. WE NOTE THAT THE ASSESSING OFFICER MADE THE ADDITIO N TO THE TUNE OF RS. 76,46,476/- AS UNEXPLAINED CASH CREDIT U/S 68 OF TH E ACT HOLDING THAT THE ASSESSEE HAD ENTERED INTO CONVENIENTLY AND HIGH SUSPICIOUS T RANSACTION AND THEREFORE, THE RULE OF SUSPICIOUS TRANSACTION OUGHT TO APPLY IN TH E ASSESSEES CASE. WE NOTE THAT THE LD. CIT(A) ALSO RELIED ON THE THEORY OF SUSPICI OUS TRANSACTION IN CONFIRMING THE ADDITION MADE BY THE ASSESSING OFFICER. BEFORE US, THE ASSESSEE HAS SUBMITTED THE COPY OF THE INVOICES (PB-1). THE ASSESSEE SUBMITTE D THE RELEVANT BANK STATEMENT (PB-2 TO 5). THE ASSESSEE FILED COPY OF THE STATEME NT OF DEMAT ACCOUNT WHICH IS PLACED AT PB-6. THE ASSESSEE FILED COPY OF CONTRACT NOTES (PB-7 TO 12). THE ASSESSEE ALSO SUBMITTED THE TRANSACTION REPORT ALON G WITH BANK STATEMENT VIDE PB- 21, AND DETAILS OF PURCHASE AND SALE OF SHARES OF C APITAL GAIN, VIDE PB-22. THE ASSESSEE ALSO SUBMITTED BEFORE US THE COPY OF BALAN CE SHEET AND PROFIT AND LOSS ACCOUNT AS ON 31.03.2014, VIDE PB-23.BY SUBMITTING THESE PLETHORA OF DOCUMENTS, THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED BEFORE U S THAT THE ASSESSEE HAS DISCHARGED ITS ONUS INCLUDING THE TRANSACTION OF LO NG TERM CAPITAL GAIN AS GENUINE. THE ADDITION SHOULD NOT BE MADE BASED ON SUSPICION THEORY WHEN THE ASSESSEE HAS SUBMITTED ALL THE DOCUMENTS LIKE BANK STATEMENT, DE MAT ACCOUNT, CONTRACT NOTES, DETAILS OF PURCHASE AND SALE ETC. NEITHER THE ASSES SING OFFICER NOR THE LD. CIT(A) FIND ANY FAULT IN THE BANK STATEMENT, COPY OF INVOI CES, DEMAT ACCOUNT, CONTRACT NOTES AND DETAILS OF PURCHASE AND SALE THEREFORE TH E ADDITION MADE BY THE ANKIT NAHATA ITA NO.2482/KOL/2017 ASSESSMENT YEAR:2014-15 P PP PA AA AG GG GE EE E | || | 5 55 5 ASSESSING OFFICER BASED ON THE THEORY OF SUSPICIOUS TRANSACTION AND HUMAN PROBABILITIES SHOULD BE DELETED. 8. WE NOTE THAT THE SCRIP IN WHICH THE ASSESSEE HAS DEALT, HAS BEEN COVERED TO BE GENUINE BY THE ORDER OF THE CO-ORDINATE BENCH IN TH E CASE OF MANISH KUMAR BAID IN I.T.A. NOS. 1236&1237/KOL/2017 FOR A.Y 2014-15, DATED 18.08.2017, WHEREIN IT WAS HELD AS FOLLOWS: 6. WE HAVE HEARD BOTH THE RIVAL SUBMISSIONS AND PER USED THE MATERIALS AVAILABLE ON RECORD. WE FIND LOT OF FORCE IN THE AR GUMENTS OF THE LD AR THAT THE LD AO WAS NOT JUSTIFIED IN REJECTING THE CLAIM OF THE ASSESSEE ON THE BASIS OF THEORY OF SURROUNDING CIRCUMSTANCES, HUMAN CONDUCT, AND PR EPONDERANCE OF PROBABILITY WITHOUT BRINGING ON RECORD ANY LEGAL EVIDENCE AGAIN ST THE ASSESSEE. WE RELY ON THE JUDGEMENT OF SPECIAL BENCH OF MUMBAI TRIBUNAL I N THE CASE OF GTC INDUSTRIES LTD. (SUPRA) FOR THIS PROPOSITION. THE VARIOUS FACETS OF THE ARGUMENTS OF THE LD AR SUPRA, WITH REGARD TO IMPLEADING THE A SSESSEE FOR DRAWING ADVERSE INFERENCES WHICH REMAIN UNPROVED BASED ON THE EVIDE NCES AVAILABLE ON RECORD, ARE NOT REITERATED FOR THE SAKE OF BREVITY. THE PRI NCIPLES LAID DOWN IN VARIOUS CASE LAWS RELIED UPON BY THE LD AR ARE ALSO NOT REI TERATED FOR THE SAKE OF BREVITY. WE FIND THAT THE AMALGAMATION OF CPAL WITH KAFL HAS BEEN APPROVED BY THE ORDER OF HONBLE HIGH COURT. THE LD AO OUGHT NOT T O HAVE QUESTIONED THE VALIDITY OF THE AMALGAMATION SCHEME APPROVED BY THE HONBLE HIGH COURT IN MAY 2013 MERELY BASED ON A STATEMENT GIVEN BY A THI RD PARTY WHICH HAS NOT BEEN SUBJECT TO CROSS EXAMINATION. MOROEVER, IT IS ALS O PERTINENT TO NOTE THAT THE ASSESSEE AND / OR THE STOCK BROKER ASHITA STOCK BRO KING 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 ABSOL UTELY NO ADVERSE MATERIAL TO IMPLICATE THE ASSESSEE TO THE ENTIRE GAMUT OF UNWAR RANTED ALLEGATIONS LEVELED BY THE LD AO AGAINST THE ASSESSEE, WHICH IN OUR CONSID ERED OPINION, HAS NO LEGS TO STAND IN THE EYES OF LAW. WE FIND THAT THE LD DR COULD NOT CONTROVERT THE AR GUMENTS OF THE LD AR WITH CONTRARY MATERIAL EVIDENCES ON RECORD AND MERELY RE LIED ON THE ORDERS OF THE LOWER AUTHORITIES APART FROM PLACING THE COPY OF SE BIS 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 THE RELATED ENTITIES / PROMOTERS / BROKERS / ENTRY OPER ATORS. IN THE INSTANT CASE, THE SHARES OF CPAL WERE PURCHASED BY THE ASSESSEE WAY B ACK ON 20.12.2011 AND PURSUANT TO MERGER OF CPAL WITH KAFL, THE ASSESSEE WAS ALLOTTED EQUAL NUMBER OF SHARES IN KAFL, WHICH WAS SOLD BY THE ASSESSEE B Y EXITING AT THE MOST OPPORTUNE MOMENT BY MAKING GOOD PROFITS IN ORDER TO HAVE A GOOD RETURN ON HIS INVESTMENT. WE FIND THAT THE ASSESSEE AND / OR TH E BROKER ASHITA STOCK BROKING LTD WAS NOT THE PRIMARY ALLOTTEES OF SHARES EITHER IN CPAL OR IN KAFL AS COULD BE EVIDENT FROM THE SEBIS ORDER. WE FIND THAT TH E SEBI ORDER DID MENTION THE LIST OF 246 BENEFICIARIES OF PERSONS TRADING IN SHA RES OF KAFL, WHEREIN, THE ASSESSEE AND / OR ASHITA STOCK BROKING LTDS NAME I S NOT REFLECTED AT ALL. HENCE ANKIT NAHATA ITA NO.2482/KOL/2017 ASSESSMENT YEAR:2014-15 P PP PA AA AG GG GE EE E | || | 6 66 6 THE ALLEGATION THAT THE ASSESSEE AND / OR ASHITA ST OCK BROKING LTD GETTING INVOLVED IN PRICE RIGGING OF KAFL SHARES FAILS. WE ALSO FIND THAT EVEN THE SEBIS ORDER HEAVILY RELIED UPON BY THE LD AO CLEARLY STAT ES THAT THE COMPANY KAFL HAD PERFORMED VERY WELL DURING THE YEAR UNDER APPEAL AN D 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 OF DIRECT EVIDENCE. THE ENQUIRY BY THE INVESTIGATION WING AND/OR THE STATEMENTS OF SEVERAL PERSONS RECORDED BY THE INVESTIGATION WING IN CONNECTION WITH THE ALLEGED B OGUS 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 EV IDENCES IN THE FORM OF BILLS, CONTRACT NOTES, DEMAT STATEMENTS AND THE BANK ACCOU NTS TO PROVE THE GENUINENESS OF THE TRANSACTIONS RELATING TO PURCHASE AND SALE O F SHARES RESULTING IN LTCG. THESE EVIDENCES WERE NEITHER FOUND BY THE LD AO TO BE FALSE OR FABRICATED. THE FACTS OF THE CASE AND THE EVIDENCES IN SUPPORT OF T HE 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 NO T JUSTIFIED IN REJECTING THE ASSESSEES CLAIM OF EXEMPTION UNDER SECTION 10(38) OF THE ACT. WE ALSO FIND THAT THE VARIOUS CASE LAWS OF HONBLE JURISDICTIONAL HIG H COURT RELIED UPON BY THE LD AR AND FINDINGS GIVEN THEREON WOULD APPLY TO THE FA CTS OF THE INSTANT CASE. THE LD DR WAS NOT ABLE TO FURNISH ANY CONTRARY CASES TO THIS EFFECT. HENCE WE HOLD THAT THE LD AO WAS NOT JUSTIFIED IN ASSESSING THE S ALE PROCEEDS OF SHARES OF KAFL AS UNDISCLOSED INCOME OF THE ASSESSEE U/S 68 OF THE ACT. WE ACCORDINGLY HOLD THAT THE REFRAMED QUESTION NO. 1 RAISED HEREINABOVE IS D ECIDED IN THE NEGATIVE AND IN FAVOUR OF THE ASSESSEE. 9. RESPECTFULLY FOLLOWING THE ORDER OF THE CO-ORDIN ATE BENCH IN THE CASE OF MANISH KUMAR BAID IN I.T.A. NOS. 1236&1237/KOL/2017 FOR A. Y 2014-15, DATED 18.08.2017 (SUPRA),WE DELETE THE ADDITION IN RESPEC T OF THE SCRIP OF KAILASH AUTO FINANCE LTD. OF RS. 76,46,476/-. 10.NOW WE SHALL TAKE GROUND NO. 3 RAISED BY THE ASS ESSEE, WHICH RELATES TO ADDITION OF RS. 2,29,394/- IN TERMS OF SECTION 69C OF THE ACT FOR THE COMMISSION ALLEGEDLY PAID TO THE BROKER FOR ARRANGING BOGUS CA PITAL GAINS. 11. WE NOTE THAT THE SAID COMMISSION ISSUE IN THE A PPEAL IS AGAINST THE ADDITION OF UNEXPLAINED EXPENDITUREOF RS. 2,29,394/-, U/S 69C O F THE ACT ON THE GROUND THAT THE ASSESSEE MUST HAVE INCURRED COMMISSION EXPENSES @ 3% OF THE LONG TERM CAPITAL GAIN. THE LD. COUNSEL SUBMITTED THAT THERE IS NO EVIDENCE OF INCURRING SUCH EXPENDITURE. IT WAS PLEADED THAT NO ADDITION U/S 69 C OF THE ACT SHOULD BE MADE, AS MAIN ADDITION OF LTCG OF RS. 76,46,476/- HAS ITSELF BEEN DELETED. THE ISSUE IS ANKIT NAHATA ITA NO.2482/KOL/2017 ASSESSMENT YEAR:2014-15 P PP PA AA AG GG GE EE E | || | 7 77 7 SQUARELY COVERED BY THE JUDGMENT OF THE CO-ORDINATE BENCH IN THE CASE OF MANISH KR. BAID (SUPRA) WHEREIN IT WAS HELD AS FOLLOWS: 7. THE NEXT COMMON ISSUE IN THE APPEALS IS AGAINST THE ADDITION OF UNEXPLAINED EXPENDITURE U/S 69C OF THE ACT ON THE G ROUND THAT THE ASSESSEE MUST HAVE INCURRED COMMISSION EXPENSES @ 5% OF THE LTCG. THE LD. AR SUBMITTED THAT THERE IS NO EVIDENCE OF INCURRING SUCH EXPENDI TURE. IT WAS PLEADED THAT NO ADDITION U/S 69C OF THE ACT COULD BE MADE UNLESS IT IS FOUND THAT THE ASSESSEE INCURRED SOME EXPENDITURE WHICH WERE NOT RECORDED I N THE BOOKS OF ACCOUNTS AND THE ASSESSEE FAILED TO SUBSTANTIATE THE SOURCE OF S UCH EXPENDITURE. 7.1. WE HAVE ALREADY HELD THAT THE TRANSACTIONS REL ATING TO LTCG WERE GENUINE AND NOT THE ACCOMMODATION ENTRIES AS ALLEGED BY THE LD AO. CONSEQUENTLY, THE ADDITION U/S 69C OF THE ACT IS HEREBY DIRECTED TO B E DELETED. WE ACCORDINGLY HOLD THAT THE REFRAMED QUESTION NO. 2 RAISED HEREINABOVE IS DECIDED IN THE NEGATIVE AND IN FAVOUR OF THE ASSESSEE. 12. RESPECTFULLY FOLLOWING THE ORDER OF THE CO-ORDINATE BENCH IN THE CASE OF MANISH KUMAR BAID, IN I.T.A. NOS. 1236&1237/KOL/2017 FOR A .Y 2014-15, DATED 18.08.2017 (SUPRA), WE DELETE THE ADDITION OF RS. 2 ,29,394/-. 13. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS AL LOWED. ORDER PRONOUNCED IN THE COURT ON 02.08.2019 SD/- ( A.T.VARKEY ) SD/- (A.L.SAINI) / JUDICIAL MEMBER / ACCOUNTANT MEMBER / DATE: 02/08/2019 ( SB, SR.PS ) COPY OF THE ORDER FORWARDED TO: 1. ANKIT NAHATA 2. ITO, WARD-34(2), KOLKATA 3. C.I.T(A)- 4. C.I.T.- KOLKATA. 5. CIT(DR), KOLKATABENCHES, KOLKATA. 6. GUARD FILE. TRUE COPY BY ORDER ASSIST ANT REGISTRAR ITAT, KOLKA TA BENCHES ANKIT NAHATA ITA NO.2482/KOL/2017 ASSESSMENT YEAR:2014-15 P PP PA AA AG GG GE EE E | || | 8 88 8