Appeal details
Counselvise Citation
[2019] 117 COUNSELVISE.COM (IT) 1230 (ITAT-BANGALORE)
Assessee PAN
Bench
Appeal Number
Duration Of Justice
8 month(s) 27 day(s)
Appellant
Respondent
Appeal Type
Income Tax Appeal
Pronouncement Date
04-06-2019
Appeal Filed By
Assessee
Order Result
Allowed
Bench Allotted
C
Assessment Year
2015-2016
Appeal Filed On
07-09-2018
Judgement Text
IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH : BANGALORE BEFORE SHRI N.V VASUDEVAN, VICE PRESIDNET AND SHRI B.R BASKARAN, ACCOUNTANT MEMBER ITA NO.2539/BANG/2018 ASSESSMENT YEAR : 2015-16 SMT. MAYA DEVI KHEMKA, NO.1126, 19 TH MAIN, 2 ND PHASE, J.P NAGAR, BANGALORE-560 078. PAN ACZPK 8433 A. VS. THE INCOME-TAX OFFICER, WARD-4(3)(3), BANGALORE. APPELLANT RESPONDENT APPELLANT BY : SHRI HARISH V, ADVOCATE RESPONDENT BY : DR. P.V PRADEEP KUMAR, ADDL. CIT (DR) DATE OF HEARING : 04.06.2019 DATE OF PRONOUNCEMENT : .06.2019 O R D E R PER B.R BASKARAN, ACCOUNTANT MEMBER THE ASSESSEE HAS FILED THIS APPEAL CHALLENGING THE ORDER DATED 24/7/2018 PASSED BY LD CIT(A)-4, BENGALURU AND IT R ELATES TO ASST. YEAR 2015-16. 2. THE ASSESSEE IS AGGRIEVED BY THE DECISION OF LD CIT(A) IN CONFIRMING THE ASSESSMENT OF INCOME FROM SALE OF SH ARE AS INCOME OF THE ASSESSEE, REJECTING THE CLAIM OF LONG TERM C APITAL GAIN AND ITA NO.2539/BANG/2018 PAGE 2 OF 5 CONSEQUENTLY DENYING EXEMPTION CLAIMED U/S 10(38) OF THE INCOME- TAX ACT 1961 (THE ACT). 3. WE HEARD THE PARTIES AND PERUSED THE RECORD. T HE ASSESSEE HAD DECLARED LONG TERM CAPITAL GAINS ON SALE OF SHA RES OF M/S PS IT INFRASTRUCTURE LTD. THE ASSESSING OFFICER, ON NOTI CING THAT THE ABOVE SAID SHARE IS CATEGORIZED AS PENNY STOCK, DISBELIEV ED THE LONG TERM CAPITAL GAINS DECLARED BY THE ASSESSEE. ACCORDINGL Y HE ASSESSED THE SALE PROCEEDS OF SHARES AS INCOME OF THE ASSESSEE. THE LD CIT(A) ALSO CONFIRMED THE SAME. 4. AT THE OUTSET THE LD AR SUBMITTED THAT THE AO HAS PASSED THE IMPUGNED ORDER ON THE BASIS OF REPORT RECEIVED FROM INVESTIGATION WING WITH REGARD TO ALLEGED PENNY STOCKS AND ALSO B Y PLACING RELIANCE ON THE STATEMENTS GIVEN BY CERTAIN SHARE B ROKERS. HE FURTHER SUBMITTED THAT THE AO ALSO PLACED RELIANCE ON THE REPORT OF SEBI. HE SUBMITTED THAT NONE OF THESE DOCUMENTS WE RE CONFRONTED WITH THE ASSESSEE AND ACCORDINGLY CONTENDED THAT TH E IMPUGNED ASST. ORDER HAS BEEN PASSED IN VIOLATION OF PRINCIP LES OF NATURAL JUSTICE. THE LD AR SUBMITTED THAT THE ASSESSEE HA D RAISED THIS ISSUE BEFORE THE LD CIT(A), BUT DID NOT GOT JUSTICE FROM HIM. ACCORDINGLY THE LD AR SUBMITTED THAT MATTER MAY BE RESTORED TO THE FILE OF THE AO FOR EXAMINING THE SAME AFRESH AFTER PROVIDING TO THE ASSESSEE ALL THE DOCUMENTS THAT WERE RELIED UPON BY THE AO. IN THIS REGARD, HE PLACED RELIANCE ON VARIOUS DECISIONS REN DERED BY HONBLE JURISDICTIONAL KARNATAKA HIGH COURT SOME OF WHICH A RE GIVEN BELOW:- ITA NO.2539/BANG/2018 PAGE 3 OF 5 A) KOTHARI METALS VS. ITO IN W.A NO.218/2015 DATED 14/8/2015 B) MR. SUNIL H ASHAR VS. ITO IN W.P NO.7001/2015 DA TED 24/6/2015. 5. THE LD DR, ON THE CONTRARY, SUBMITTED THAT THE A O DID NOT RELY ON SWORN STATEMENTS GIVEN BY BROKERS. ACCORDI NGLY HE SUBMITTED THAT THERE WAS NO NECESSITY TO PROVIDE OP PORTUNITY OF CROSS EXAMINATION TO THE ASSESSEE. HE FURTHER SUBM ITTED THAT THE ASSESSEE DID NOT ASK FOR VARIOUS DOCUMENTS THAT WER E RELIED UPON BY THE AO AND HENCE THERE WAS NO OCCASION FOR THE A O TO PROVIDE THE SAME. THE LD DR, BY PLACING RELIANCE ON THE DE CISION RENDERED BY HONBLE SUPREME COURT IN THE CASE OF K.L TRIPATH I VS. STATE BANK OF INDIA (1984) AIR 273 SUBMITTED THAT THERE I S NO NECESSITY TO PROVIDE DOCUMENTS WHEN IT WAS NOT ASKED FOR BY T HE ASSESSEE. 6. WE HEARD THE RIVAL CONTENTIONS AND PERUSED THE R ECORD. WE NOTICED FROM THE ASST. ORDER THAT THE ASSESSEE HAS SUBMITTED BEFORE THE AO THAT THE LONG TERM CAPITAL GAINS EARNED BY H ER ON SALE OF SHARES OF PSIT INFRASTRUCTURE WAS GENUINE. WE FURT HER NOTICE THAT IT IS THE AO WHO HAS IDENTIFIED THE ABOVE SAID STOCK A S PENNY STOCK ON THE BASIS OF REPORT GIVEN BY INVESTIGATION WING AND ALSO THE REPORT OF SEBI. THE AO HAS ALSO RECORDED THAT THE DIRECTO R OF INVESTIGATION, KOLKATTA HAS INVESTIGATED TRANSACTIO NS IN 84 PENNY STOCK SHARES QUOTED ON BSC AND ALSO EXAMINED THE P ROMOTERS OF SAID COMPANIES, ENTRY OPERATORS WHO MANAGED THE PRI CE RIGGING OF THE SHARES. THUS WE NOTICED THAT THE AO HAS PLACED RELIANCE ON CERTAIN DOCUMENTS AND THE SAME HAS NOT BEEN CONFRON TED TO THE ITA NO.2539/BANG/2018 PAGE 4 OF 5 ASSESSEE IN ORDER TO REJECT THE CLAIM OF LONG TERM CAPITAL GAIN. UNDER THE SET OF FACTS, WE ARE OF THE VIEW THAT THERE IS MERIT IN THE PLEA OF THE ASSESSEE. ACCORDINGLY WE SET ASIDE THE ORDER P ASSED BY LD CIT(A) AND RESTORE ALL THE ISSUES TO THE FILE OF TH E AO WITH THE DIRECTIONS TO CONFRONT WITH THE ASSESSEE ALL THE DO CUMENTS THAT WERE RELIED UPON BY HIM IN ACCORDANCE WITH LAW. AFTER A FFORDING ADEQUATE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE , THE AO MAY TAKE APPROPRIATE DECISION IN ACCORDANCE WITH THE LA W. 7 . IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE I S TREATED AS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON JUNE, 2019. SD/ - (N.V VASUDEVAN) VICE PRESIDENT SD/ - (B.R BASKARAN) ACCOUNTANT MEMBER BANGALORE, DATED, JUNE, 2019. / VMS / COPY TO: 1. THE APPLICANT 2. THE RESPONDENT 3 . THE CIT 4. THE CIT(A) 5. THE DR, ITAT, BANGALORE. 6. GUARD FILE BY ORDER A SST. REGISTRAR, ITAT, BANGALORE. ITA NO.2539/BANG/2018 PAGE 5 OF 5 1. DATE OF DICTATION 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER . 3. DATE ON WHICH THE APPROVED DRAFT COMES TO SR.P.S .. 4. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE DICTATING MEMBER .. 5. DATE ON WHICH THE FAIR ORDER COMES BACK TO THE S R. P.S. .. 6. DATE OF UPLOADING THE ORDER ON WEBSITE.. 7. IF NOT UPLOADED, FURNISH THE REASON FOR DOING SO .. 8. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK .. 9. DATE ON WHICH ORDER GOES FOR XEROX & ENDORSEMENT 10. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK . 11. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT REGISTRAR FOR SIGNATURE ON THE ORDER . 12. THE DATE ON WHICH THE FILE GOES TO DISPATCH SEC TION FOR DISPATCH OF THE TRIBUNAL ORDER . 13. DATE OF DESPATCH OF ORDER. ..
