The Addl. CIT Range-3, Indore V. Shri Guvinder Singh Bhatia, Indore

ITA 299/IND/2011

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 5826 (ITAT-INDORE)
• Duration Of Justice: 4 year(s) 9 month(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-08-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 11-05-2016
• Assessment Year: 2008-2009
• Appeal Filed On: 03-11-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ARPIT GAUR CAS
• Assessee Lawyers: RAJEEV VARSHNEY; R A VERMA DRS
• Keywords: Unexplained cash credit; Gift; Opportunity of being heard; Validity of assessment; Accommodation entries; Tax effect
• Section: 143(3); 142(1); 153A; 68; 139

Judgement Text

GURVINDER SINGH BHATIA (SS)116 OF 2011 AND OTHERS 1 IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH, INDORE BEFORE SHRI D.T. GARASIA, JUDICIAL MEMBER AND SHRI B.C. MEENA, ACCOUNTANT MEMBER IT(SS)A NOS.116 TO 119/IND/2011 A.YS. 2003-04 TO 2006-07 GURVINDER SINGH BHATIA, INDORE PAN ABHPB 5245 N :: ASSESSEE VS ADDL. CIT, RANGE-3, INDORE :: RESPONDENT ITA NO.299/IND/2011 A.Y. 2008-09 ADDL. CIT, RANGE-3, INDORE :: ASSESSEE VS GURVINDER SINGH BHATIA, INDORE PAN ABHPB 5245 N :: RESPONDENT ASSESSEE BY SHRI ANIL KAMAL GARG AND SHRI ARPIT GAUR, CAS RESPONDENT BY SHRI RAJEEV VARSHNEY AND SHRI R.A. VERMA, DRS DATE OF HEARING 18.5.2016 DATE OF PRONOUNCEMENT 18.5.2016 O R D E R PER SHRI D.T. GARASIA, JM GURVINDER SINGH BHATIA (SS)116 OF 2011 AND OTHERS 2 THE ABOVE APPEALS FILED BY THE ASSESSEE AND REVENUE ARE DIRECTED AGAINST THE DIFFERENT ORDERS OF LD. CIT(A) -I, INDORE, DATED 05.8.2011. SINCE IDENTICAL FACTS AND CIRCUMSTANCES ARE INVOLVED IN THE PRESENT APPEALS, WE ARE TAKING FACTS FROM THE A.YS. 2003-04 & 2004-05 ON IDENTICAL ISSUES. GROUND NOS. 1.1 & 1.2 INVOLVED IN IT(SS)A NOS.116 TO 119/IND/2011 THESE GROUNDS ARE DIRECTED AGAINST THE AOS ACTION OF MAKING ADDITIONS U/S 153A OF THE I.T. ACT ON THOSE ISSUES IN RESPECT OF WHICH NO INCRIMINATING MATERIAL WAS FOUND OR SEIZED DURING T HE COURSE OF SEARCH. 2. SHORT FACTS OF THE CASE ARE THAT THE ASSESSEE IS AN INDIVIDUAL, PRESENTLY AGED NEARLY 61 YEARS. THE ASSESSEE IS REG ULARLY ASSESSED TO INCOME-TAX FOR THE LAST MANY YEARS. THE ASSESSEE FU RNISHED HIS ORIGINAL RETURN OF INCOME, PERTAINING TO THE ASSESSMENT YEAR UNDER REVIEW, U/S. 139 OF THE INCOME-TAX ACT, 1961, ON 28-11-2003 VIDE ACK. NO. 0331010670 WITH THE THEN ITO-3(2), INDORE, DECLARIN G AN INCOME OF RS.21,30,900/- [PB PAGE NO. 17 TO 20]. IN RESPONSE TO THE RETURN OF INCOME, FURNISHED BY THE ASSESSEE U/S. 139 OF THE I NCOME-TAX ACT, 1961, AN ASSESSMENT WAS FRAMED BY THE ACIT-3(1), IN DORE U/S. 143(3) OF THE INCOME-TAX ACT, 1961 ON 31-03-2006 DETERMINING THE TOTAL INCOME OF THE ASSESSEE AT RS.35,54,962/- AS AGAINST THE RETUR NED INCOME OF RS.21,30,900/- THEREBY MAKING ADDITIONS OF RS.14,24 ,062/-. A SEARCH U/S. 132(1) OF THE INCOME-TAX ACT, 1961 WAS CARRIED OUT BY THE ASSISTANT DIRECTOR OF INCOME-TAX (INV.)-II, INDORE, ON 25-09- 2007, IN THE RESIDENTIAL PREMISES OF THE ASSESSEE AS ALSO IN THE BUSINESS PR EMISES IN WHICH FAMILY MEMBERS/RELATIVES OF THE ASSESSEE WERE HAVIN G VESTED INTEREST. DURING THE COURSE OF THE SEARCH, THE BHATIA GROUP H AD ADMITTED ADDITIONAL INCOME AGGREGATING TO RS.26,15,24,529/- AND AS AGAINST SUCH GURVINDER SINGH BHATIA (SS)116 OF 2011 AND OTHERS 3 ADMITTED INCOME OF RS.26,15,24,529/-, THE GROUP, AS A WHOLE, HAD SHOWN AN ADDITIONAL INCOME OF RS.27,33,73,087/- IN THE RE TURNS OF INCOME FURNISHED UNDER S.153A OF THE ACT. HOWEVER, THE ASS ESSEE NEITHER ADMITTED NOR DECLARED ANY ADDITIONAL INCOME IN HIS RETURN OF INCOME. SUCH FACTS ARE EVIDENT FROM THE FINDINGS GIVEN BY T HE CIT(A) AT PARA 2 & 2.1 AT PAGE NO. 3 & 4 OF HIS ORDER. DURING THE COUR SE OF THE SEARCH, NO UNDISCLOSED OR UNEXPLAINED MONEY, BULLION, JEWELLER Y, VALUABLE ARTICLES OR THINGS PERTAINING TO THE ASSESSEE WERE FOUND OR SEI ZED. SUBSEQUENTLY, A NOTICE DATED 03-03-2008 WAS ISSUED BY THE ADDL. COM MISSIONER OF INCOME-TAX, RANGE-3, INDORE, U/S. 153A OF THE INCOM E-TAX ACT, 1961 [PB PAGE NO. 1]. UNDER SUCH NOTICE, THE ASSESSEE WA S REQUIRED TO FURNISH HIS RETURN OF TOTAL INCOME PERTAINING TO TH E ASSESSMENT YEAR UNDER REVIEW, WITHIN A PERIOD OF 30 DAYS FROM THE D ATE OF SERVICE OF THE NOTICE. IN COMPLIANCE TO THE NOTICE UNDER S. 153A, THE ASSESSEE, FURNISHED HIS RETURN OF TOTAL INCOME ON 09-06-2008 VIDE ACK. NO. 0030100123 DECLARING AN INCOME OF RS.34,94,966/-. A LONG WITH THE COMPUTATION OF TOTAL INCOME, THE ASSESSEE HAD FURNI SHED COPY OF CAPITAL ACCOUNT AND ALSO HIS STATEMENT OF AFFAIRS R ELEVANT TO THE PREVIOUS YEAR UNDER REVIEW (PB PAGE NO. 24 TO 29). THE CASE OF THE ASSESSEE WAS SELECTED FOR SCRUTINY AND NOTICES U/S. 143(2) & 142(1) ALONG WITH A QUESTIONNAIRE WERE ISSUED FOR THE FIRS T TIME ON 25-08-2008. COPIES OF THE NOTICES U/S. 142(1) ALONG WITH A COPY OF QUESTIONNAIRE ARE PLACED AT PAGE NO. 73 TO 79 OF THE PAPER BOOK. IN R ESPONSE TO SUCH NOTICES, THE ASSESSEE THROUGH HIS AUTHORIZED REPRES ENTATIVE ATTENDED THE HEARING BEFORE THE ASSESSING OFFICER FROM TIME TO TIME AND MADE WRITTEN SUBMISSIONS DATED 23-06-2009 AND 09-12-2009 ALONG WITH NECESSARY DOCUMENTARY EVIDENCES. COPIES OF SUCH WRI TTEN SUBMISSIONS ARE PLACED AT PAGE NO. 80 TO 101 OF THE PAPER BOOK. FINALLY, THE ASSESSING OFFICER FRAMED THE ASSESSMENT ON 22-12-20 09, U/S. 143(3) GURVINDER SINGH BHATIA (SS)116 OF 2011 AND OTHERS 4 READ WITH SECTION 153A OF THE INCOME-TAX ACT, 1961, DETERMINING THE INCOME OF THE ASSESSEE AT RS.1,01,03,052/- AS AGAIN ST THE RETURNED INCOME OF RS.34,94,966/- THEREBY MAKING ADDITIONS O F RS.66,08,086/-, AS PER DETAILS GIVEN BELOW: SNO. PARTICULARS AMOUNT (RS.) 1 ADDITION ON ACCOUNT OF GIFT IN FORM OF RESURGENT BO NDS [ON PROTECTIVE BASIS] 65,26,716 2 ADDITION ON ACCOUNT OF AD-HOC DISALLOWANCE OF EXP ENSES IN RESPECT OF PERSONAL USER THEREOF 81,370 TOTAL ADDITIONS 66,08,086 THE AO HAS NOT GIVEN ANY SPECIFIC FINDING ON THE IS SUE OF VALIDITY OF ASSESSMENT U/S 153A WHERE NO INCRIMINATING DOCUMENT S WERE FOUND AND SEIZED DURING THE COURSE OF SEARCH. HOWEVER, THE AO AT PAGE NO. 2 OF THE ASSESSMENT ORDER, HAS STATED THAT DURING THE CO URSE OF THE ASSESSMENT PROCEEDING HE HAD ASCERTAINED FROM THE P &L ACCOUNT AND BALANCE SHEET OF THE ASSESSEE THAT THE ASSESSEE HAD RECEIVED CERTAIN GIFT FROM VARIOUS PERSONS. 3. MATTER CARRIED TO LEARNED CIT(A), WHO UPHELD THE VALIDITY OF THE ASSESSMENT PROCEEDINGS UNDER S. 153A OF THE ACT . T HE CIT(A) ALSO CONFIRMED THE ADDITION MADE BY THE AO IN THE ASSESS EES INCOME, ON PROTECTIVE BASIS, ON ACCOUNT OF GIFT IN FORM OF RES URGENT BONDS, AT RS.65,26,716/- TO SUBSTANTIVE BASIS. THE LEARNED CI T(A) GRANTED RELIEF IN RESPECT OF AD-HOC DISALLOWANCE OF EXPENSES IN RESPE CT OF PERSONAL USER THEREOF AT RS.81,370/-. THE CIT(A) HAS DEALT WITH T HE ISSUE AT PARA 2.4.1, PAGE NO. 8 OF THE ORDER. THE CIT(A), AT PARA 2.4.1, HAS GIVEN A TABLE SHOWING VARIOUS GROUNDS RAISED BY THE ASSESSEE, THE ISSUE INVOLVED AND THE APPEAL OF THE ASSESSEE/GROUP ASSESSEE WHERE THE SUBJECT ISSUE HAS BEEN DISCUSSED BY HIM. ACCORDINGLY, THE CIT(A) DISM ISSED THE LEGAL GURVINDER SINGH BHATIA (SS)116 OF 2011 AND OTHERS 5 GROUND RAISED BY THE ASSESSEE FOLLOWING HIS OWN FIN DINGS GIVEN IN THE CASE OF THE ONE OF THE GROUP ASSESSEES NAMELY SHRI AMANDEEP SINGH BHATIA IN APPEAL NO. IT-223/09-10 FOR A.Y. 2002-03. 4. THE LD. AR FOR THE ASSESSEE HAS MADE ORAL AS WEL L AS WRITTEN SUBMISSION AS UNDER: 1.00 AS REGARD TO THE GROUNDS TAKEN BY THE ASSESSE E IN THE PRESENT APPEAL, IT IS SUBMITTED THAT THE GROUNDS FOR THE ASSESSMENT YEAR 2003-04 AND GROUNDS TAKEN BY SHRI AMANDEEP SINGH BHATIA IN HIS APPEAL N O. IT(SS)A 112/IND/2011 FOR A.Y. 2002-03 ARE IDENTICAL. IT IS SUBMITTED THAT EVEN THE LEARNED CIT (A) PASSING HIS ORDER FOR THE PRESENT A SSESSMENT YEAR UNDER CONSIDERATION I.E. A.Y. 2003-04 IN THE CASE OF THE ASSESSEE, HAS ALSO RELIED UPON HIS OWN FINDINGS GIVEN IN THE CASE OF SHRI AMA NDEEP SINGH BHATIA FOR A.Y. 2002-03 AND, THEREFORE, IN ORDER TO AVOID REPE TITION, WE ALSO WISH TO PLACE OUR RELIANCE ON OUR SYNOPSIS MADE ON THE RESPECTIVE GROUNDS MADE IN RESPECT OF SHRI AMANDEEP SINGH BHATIA FOR A.Y. 2002-03 IN A PPEAL NO. IT(SS)A 112/IND/2011. RELEVANT DOCUMENTS FILED IN THE PAPER BOOK ON WHICH THE ASSESSEE IS PLACING RELIANCE FOR THIS GROUND PAGE NO. NATURE OF DOCUMENT FILED FOR THE PURPOSE OF FROM TO 17 20 COPY OF ORIGINAL RETURN FILED UNDER S.139 ESTABLISHING THAT THE ASSESSEE HAD FILED HIS ORIGINAL RETURN. 24 25 COPY OF CAPITAL ACCOUNT AND STATEMENT OF AFFAIRS FILED WITH ORIGINAL RETURN ESTABLISHING THAT IN THE CAPITAL ACCOUNT FILED WITH THE ORIGINAL RETURN ITSELF, THE ASSESSEE HAD DISCLOSED THE FACTUM OF RECEIPT OF RESURGENT INDIA BONDS OF WORTH OF RS.57,73,000/- DURING THE YEAR UNDER CONSIDERATION. 78 79 COPY OF SHOW-CAUSE NOTICE DATED 07-12- 2009 ISSUED BY AO ESTABLISHING THAT NO INCRIMINATING MATERIAL WAS FOUND DURING THE COURSE OF SEARCH IN RESPECT OF RIB/NRI GIFTS AS IS EVIDENT FROM PARA 2 OF THE SHOW- CAUSE NOTICE. 164 170 COPY OF THE ORIGINAL ASSESSMENT ORDER PASSED U/S. 143(3) OF ESTABLISHING THAT THE SUBJECT ASSESSMENT YEAR WAS A COMPLETED GURVINDER SINGH BHATIA (SS)116 OF 2011 AND OTHERS 6 THE ACT IN THE CASE OF THE ASSESSEE FOR A.Y. 2003-04 ASSESSMENT YEAR. 5. LD. DRS HAVE RELIED ON THE ORDERS OF THE REVENUE AUTHORITIES AND SUBMITTED THAT OUR ARGUMENTS ADVANCED IN THE CASE O F AMANDEEP SINGH BHATIA ON IDENTICAL FACTS MAY BE TAKEN INTO CONSIDE RATION. 6. WE HAVE HEARD RIVAL CONTENTIONS OF BOTH THE PART IES AND PERUSED MATERIAL AVAILABLE ON RECORD. THE CIT(A) HAS RELIED UPON HIS OWN FINDINGS GIVEN IN THE CASE OF SHRI AMANDEEP SINGH B HATIA. WE FIND THAT THIS ISSUE HAS ALREADY BEEN DEALT WITH BY US IN THE CASE OF ONE OF THE GROUP ASSESSEES NAMELY, AMANDEEP SINGH BHATIA IN AP PEAL NO. IT(SS)A NO.112/IND/2011 FOR A.Y. 2002-03, WHEREIN W E HAVE HELD THAT IN ABSENCE OF ANY INCRIMINATING DOCUMENTS FOUND AND SEIZED DURING THE COURSE OF SEARCH, THE ASSESSING OFFICER IS NOT JUST IFIED IN MAKING THE ADDITIONS IN NON-ABATED ASSESSMENT ORDERS WHILE PAS SING THE ORDERS U/S 153A R.W.S. 143(3) OF THE ACT. THUS, WE QUASH THE ASSESSMENT ORDERS FOR THE A.YS. 2003-04 & 2004-05 BEING NON-ABATED. A CCORDINGLY, THIS ISSUE OF INCRIMINATING MATERIAL IN THE ASSESSEES A PPEALS IT(SS)A NOS. 116 & 117/IND/2011 IS ALLOWED. HOWEVER, SINCE THE A SSESSMENTS FOR THE A.YS. 2005-06 & 2006-07 ARE ABATED, THE PRESENT ISS UE IN ASSESSEES APPEALS IT(SS)A NOS.118 & 119/IND/2011 FOR THE A.YS . 2005-06 & 2006- 07 WAS NOT PRESSED BY THE LD. COUNSEL FOR THE ASSES SEE DURING THE COURSE OF HEARING, THEREFORE, SAME ARE DISMISSED FO R THE A.YS. 2005-06 & 2006-07 BEING NOT PRESSED. GROUND NO. 2 INVOLVED IN IT(SS)A NOS.116 TO 119/IND /2011 7. THIS GROUND IS DIRECTED AGAINST THE CIT(A)S FIN DING OF UPHOLDING AOS ACTION OF PASSING THE ASSESSMENT ORDER ARBITRA RILY WITHOUT GIVING GURVINDER SINGH BHATIA (SS)116 OF 2011 AND OTHERS 7 PROPER OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. THE CIT(A) HAS DEALT WITH THIS GROUND AT PARA 5.2 OF PAGE NO. 12 OF HIS ORDER. ACCORDING TO THE CIT(A), THE ASSESSEE WAS GIVEN DUE OPPORTUNITY BY T HE AO. BEFORE US, LD. COUNSEL FOR THE ASSESSEE DID NOT PRESS THIS GRO UND. THEREFORE, SAME IS DISMISSED IN ALL THE APPEALS OF THE PRESENT ASSE SSEE BEING NOT PRESSED. ADDITIONAL GROUND NO. 1 IN IT(SS)A NO.116/IND/2011 8. THE ASSESSEE HAS TAKEN ONE ADDITIONAL LEGAL GROU ND VIDE A SEPARATE APPLICATION UNDER RULE 11 OF THE INCOME-TA X (APPELLATE TRIBUNAL) RULES, 1963 FILED ON 27-04-2012. THIS GRO UND IS DIRECTED AGAINST THE CIT(A)S ACTION OF CONFIRMING THE ADDIT ION OF RS.65,26,716/- MADE BY THE AO IN RESPECT OF RIB BONDS, ON PROTECTI VE BASIS TO SUBSTANTIVE BASIS WITHOUT GIVING ANY NOTICE OF ENHA NCEMENT AS REGARD TO THE CHANGE IN THE NATURE OF ADDITION FROM PROTECTIV E TO SUBSTANTIVE. 9. THE CIT(A) HAS GIVEN HIS FINDINGS AT PARA 5.3 AT PAGE NO. 12 OF HIS ORDER. THE CIT(A) HAS GIVEN THE DETAILS OF THE ADDI TION MADE BY THE AO AND ADDITIONS UPHELD BY HIM, ON ACCOUNT OF RIB BOND S, IN FORM OF A TABLE GIVEN AT PAGE NO. 12 OF HIS ORDER. 10. THE LD. AR FOR THE ASSESSEE HAS MADE ORAL AS WE LL AS WRITTEN SUBMISSION AS UNDER: AS REGARD THE ADDITIONAL LEGAL GROUND TAKEN BY THE ASSESSEE IN THE PRESENT APPEAL, IT IS SUBMITTED THAT A SIMILAR GROUND FOR T HE ASSESSMENT YEAR 2002-03 HAS BEEN TAKEN IN THE CASE OF SHRI AMANDEEP SINGH B HATIA IN APPEAL NO. IT(SS)A 112/IND/2011. THE GROUND OF THE ASSESSEE IN THE PRESENT APPEAL IS IDENTICAL WITH THAT OF THE ADDITIONAL GROUND OF SHR I AMANDEEP SINGH BHATIA FOR A.Y. 2002-03. THEREFORE, IN ORDER TO AVOID REPETITI ON, WE WISH TO PLACE OUR RELIANCE ON OUR SYNOPSIS MADE ON THE RESPECTIVE GRO UND MADE IN RESPECT OF SHRI AMANDEEP SINGH BHATIA FOR A.Y. 2002-03 IN APPE AL NO. IT(SS)A 112/IND/2011. 11. LD. DR HAS RELIED ON THE ORDERS OF THE REVENUE AUTHORITIES. GURVINDER SINGH BHATIA (SS)116 OF 2011 AND OTHERS 8 12. WE HAVE HEARD RIVAL CONTENTIONS OF BOTH THE PAR TIES AND PERUSED MATERIAL AVAILABLE ON RECORD. WE FIND THAT SIMILAR ADDITIONAL GROUND FOR THE ASSESSMENT YEAR 2002-03 HAS BEEN TAKEN IN THE C ASE OF AMANDEEP SINGH BHATIA IN APPEAL NO. IT(SS)A 112/IND/2011. TH E ADDITIONAL GROUND OF THE ASSESSEE IN THE PRESENT APPEAL IS IDENTICAL WITH THAT OF THE ADDITIONAL GROUND OF SHRI AMANDEEP SINGH BHATIA FOR A.Y. 2002-03. IN THE CASE OF AMANDEEP SINGH BHATIA, WE, AFTER CONSID ERING THE SUBMISSIONS OF BOTH THE PARTIES, HAVE DISMISSED THE ADDITIONAL GROUND OF THE ASSESSEE. FOR READY REFERENCE, THE RELEVANT POR TION OF THE ORDER IS REPRODUCED HEREUNDER: WE HAVE HEARD RIVAL CONTENTIONS OF BOTH THE PARTIE S AND PERUSED THE MATERIAL AVAILABLE ON RECORD. HOWEVER, WE FIND NO M ERIT IN THE CONTENTION OF THE LD. AR OF THE ASSESSEE. WE FIND T HAT IN THE ASSESSEES CASE, FOR THE ASSESSMENT YEAR UNDER CONSIDERATION I .E. A.Y. 2002-03, THE ADDITION OF RS.70,29,000/- WAS MADE BY THE AO O N PROTECTIVE BASIS ONLY. THE ADDITION WAS MADE FOR SUCH ASSESSMENT YEA R ON THE BASIS THAT DURING SUCH ASSESSMENT YEAR ONLY, THE ASSESSEE HAD CLAIMED TO HAVE RECEIVED CERTAIN RESURGENT BONDS FROM NRIS AS GIFTS. SUCH BONDS GOT MATURED DURING THE PREVIOUS YEAR RELEVANT TO A. Y. 2004-05 FOR A SUM OF RS.1,00,44,384/-. IT WAS THEREFORE, THE AO M ADE AN ADDITION OF RS.1,00,44,384/- IN A.Y. 2004-05 ON SUBSTANTIVE BAS IS. THE ASSESSEE PREFERRED THE APPEALS AGAINST THE ASSESSMENT ORDERS PASSED FOR BOTH THE ASSESSMENT YEARS I.E. A.Y. 2002-03 AND A.Y. 200 4-05. IN OUR VIEW, THE VERY PRUPOSE OF GIVING NOTICE U/S 251(2) OF THE ACT IS TO MAKE THE ASSESSEE AWARE OF THE PROPOSED ENHANCEMENT AND CHAR GES AGAINST HIM. IN THE INSTANT CASE, THE ASSESSEE WAS ALREADY AWARE OF THE CHARGES AGAINST HIM AND THE LD. CIT(A) HAS MERELY S HIFTED ADDITION MADE IN ONE ASSESSMENT YEAR TO ANOTHER ASSESSMENT Y EAR AND THEREFORE, THERE WAS NO SPECIFIC NEED FOR ISSUANCE OF ANY NOTICE U/S 251(2) OF THE ACT. THUS, THESE ADDITION GROUNDS TAK EN BY THE ASSESSEE ARE HAVING NO MERIT AND THE SAME ARE DISMISSED. 13. FOLLOWING THE ABOVE SAME REASONING, WE DISMISS THE ADDITIONAL GROUND TAKEN BY THE ASSESSEE. GROUND NO. 3 INVOLVED IN IT(SS)A NO.116/IND/2011 GURVINDER SINGH BHATIA (SS)116 OF 2011 AND OTHERS 9 14. THIS GROUND IS DIRECTED AGAINST THE CIT(A)S AC TION OF CONFIRMING THE ADDITION OF RS.65,26,716/- MADE BY THE AO UNDER S.68 OF THE ACT ON PROTECTIVE BASIS, ON ACCOUNT OF RESURGENT INDIA BON DS. 15. SHORT FACTS OF THE CASE ARE THAT THE AO HAS DEA LT WITH THIS ISSUE AT PARA 1, FROM PAGE NO. 2 TO 26 OF HIS ORDER. THE CRU X OF THE FINDINGS OF THE AO, AS GIVEN AT PAGE NO. 14 OF THE ORDER, IS THAT ( I) WHY THE NRIS ARE GIFTING HUGELY TO AFFLUENT PERSONS ONLY AND NOT TO POOR PERSONS; (II) DOCUMENTATION BY ITSELF CANNOT PROVE THE REAL INTEN T OF THE TRANSACTION AND; (III) AN NRI SITTING ABROAD GIVING GIFT TO PER SONS IN INDIA THEN HOW THE SOURCES AND CREDITWORTHINESS OF THE NRI CAN BE EXAM INED. FINALLY, THE AO, AT LAST BUT ONE PARA OF PAGE NO. 25, HAS MADE T HE ADDITION OF RS.65,26,716/- BY HOLDING THE GIFT IN THE FORM OF R ESURGENT BONDS, RECEIVED BY THE ASSESSEE DURING THE RELEVANT ASSESS MENT YEAR, AS ACCOMMODATION ENTRIES UNDER S.68 OF THE ACT ON PROT ECTIVE BASIS. 16. MATTER CARRIED TO LEARNED CIT(A), WHO HAS DEALT WITH THE ISSUE AT PARA 2.4.1, PAGE NO. 8 OF THE ORDER. THE CIT(A), A T PARA 2.4.1, HAS GIVEN A TABLE SHOWING VARIOUS GROUNDS RAISED BY THE ASSES SEE, THE ISSUE INVOLVED AND THE APPEAL OF THE ASSESSEE/ GROUP ASSE SSEE WHERE THE SUBJECT ISSUE HAS BEEN DISCUSSED BY HIM. ACCORDINGL Y, THE CIT(A) CONFIRMED THE ADDITION OF RS.65,26,716/-, BEING THE MATURITY VALUE OF RIB BONDS ON SUBSTANTIVE BASIS, FOLLOWING HIS OWN FINDI NGS GIVEN IN THE CASE OF SHRI AMANDEEP SINGH BHATIA IN APPEAL NO. IT-223/ 09-10 FOR A.Y. 2002-03. 17. THE LD. AR FOR THE ASSESSEE HAS MADE ORAL AS WE LL AS WRITTEN SUBMISSION AS UNDER: AS REGARD THIS GROUND TAKEN BY THE ASSESSEE IN THE PRESENT APPEAL, IT IS SUBMITTED THAT SIMILAR GROUNDS FOR THE ASSESSMENT Y EAR 2002-03 HAS BEEN TAKEN IN THE CASE OF SHRI AMANDEEP SINGH BHATIA IN APPEAL NO. IT(SS)A GURVINDER SINGH BHATIA (SS)116 OF 2011 AND OTHERS 10 112/IND/2011. THE FACTS OF THE GROUND OF THE ASSESS EE IN THE PRESENT APPEAL ARE IDENTICAL WITH THAT OF THE GROUNDS OF SHRI AMAN DEEP SINGH BHATIA FOR A.Y. 2002-03. THEREFORE, IN ORDER TO AVOID REPETITION, W E WISH TO PLACE OUR RELIANCE ON OUR SYNOPSIS MADE ON THE RESPECTIVE GROUNDS MADE IN RESPECT OF SHRI AMANDEEP SINGH BHATIA FOR A.Y. 2002-03 IN APPEAL NO . IT(SS)A 112/IND/2011. RELEVANT DOCUMENTS FILED IN THE PAPER BOOK ON WHICH THE ASSESSEE IS PLACING RELIANCE FOR THESE GROUNDS PAGE NO. NATURE OF DOCUMENT FILED FOR THE PURPOSE OF FROM TO 102 103 COPY OF CHART SHOWING THE DETAILS OF RIB GIFTS GIVING THE COMPLETE DETAILS OF THE DONORS AND THE TRANSACTIONS 104 116 COPY OF RIB BONDS ESTABLISHING THE IDENTITY OF THE DONORS, THE PURCHASE OF THE BONDS IN THE YEAR 1998 BY THE DONORS, THE TERMS OF THE ISSUE OF THE BONDS. 117 125 COPIES OF TRANSFER LETTERS ESTABLISHING THE GENUINENESS OF THE TRANSACTIONS 126 131 COPIES OF THE LETTERS ISSUED BY SBI FOR ESTABLISHING THE ASSERTION THAT THE BANK HAD ACCEPTED THE GENUINENESS OF THE TRANSACTION OF GIFTS. 132 151 RELEVANT ABSTRACT OF REPLY ON THE ISSUE FILED BEFORE CIT(A) FOR ESTABLISHING THE FACT THAT ALL THE ARGUMENTS WHICH HAVE BEEN CANVASSED BEFORE THIS HONBLE BENCH WERE ALSO MADE BEFORE THE CIT(A) BUT HE FAILED TO APPRECIATE SUCH ARGUMENTS. 152 162 SUPPLEMENTARY SUBMISSION BEFORE CIT(A) --- DO --- 163 163 GIST OF THE SCHEME OF THE RIBS FOR ESTABLISHING THAT AS PER THE SCHEME, RIBS WERE TRANSFERRABLE BY WAY OF GIFT EVEN TO A NON- RELATIVE INDIAN. 171 192 COPY OF DECISION OF HONBLE INDORE BENCH OF ITAT IN THE CASE OF SHRI FOR ESTABLISHING THE FACT THAT THE ISSUE IN HAND IS SQUARELY COVERED BY THE GURVINDER SINGH BHATIA (SS)116 OF 2011 AND OTHERS 11 PHOOLCHAND AGRAWAL ORDER OF THIS HONBLE BENCH ITSELF. 18. LD. DRS HAVE RELIED ON THE ORDERS OF THE REVENU E AUTHORITIES AND SUBMITTED THAT OUR ARGUMENTS ADVANCED IN THE CASE O F AMANDEEP SINGH BHATIA ON IDENTICAL FACTS MAY BE TAKEN INTO CONSIDE RATION. 19. WE HAVE HEARD RIVAL CONTENTIONS OF BOTH THE PAR TIES AND PERUSED MATERIAL AVAILABLE ON RECORD. THE CIT(A) HAS RELIED UPON HIS OWN FINDINGS GIVEN IN THE CASE OF SHRI AMANDEEP SINGH B HATIA. WE FIND THAT THIS ISSUE HAS ALREADY BEEN DEALT WITH BY US IN THE CASE OF ONE OF THE GROUP ASSESSEES NAMELY, AMANDEEP SINGH BHATIA IN AP PEAL NO. IT(SS)A NO.112/IND/2011 FOR A.Y. 2002-03, WHEREIN W E HAVE HELD AS UNDER: WE HAVE HEARD RIVAL CONTENTIONS OF BOTH THE PARTI ES AND PERUSED THE MATERIAL AVAILABLE ON RECORD. LOOKING TO THE FA CTS AND CIRCUMSTANCES, WE FIND THAT ASSESSEE HAS FILED ORIG INAL RETURN OF INCOME U/S 139 OF THE I.T. ACT, 1961 ON 25.1.2003. ALONG W ITH THE RETURN, THE ASSESSEE HAS FURNISHED THE COPY OF CAPITAL ACCOUNT, F.Y. ENDED ON 31.3.2002 IN WHICH THE RECEIPT OF RIB OF VALUE AT R S.70,29,000 WAS CLEARLY REFLECTED IN THE STATEMENT OF AFFAIRS FILED ALONG WITH THE ORIGINAL RETURN. ASSESSEE HAS SHOWN SUCH RIB BOND OF RS.70,2 9,000/-. WE FIND THAT ASSESSING OFFICER HAS MADE THE ADDITION BY INV OKING PROVISIONS OF SEC. 68 OF THE ACT WHICH SAYS THAT ADDITION IS BASE D ON ENTRIES FOUND IN REGULAR BOOKS OF ACCOUNTS. THE ASSESSING OFFICER DI D NOT REFER ANY SEIZED MATERIAL OR ANY INCRIMINATING MATERIAL WHILE MAKING THIS ADDITION. WHILE MAKING THE ADDITION U/S 153A, THE ADDITION CA N BE MADE IN RESPECT OF NON-ABATED ASSESSMENTS ONLY IF ANY SEIZE D MATERIAL IS FOUND DURING THE COURSE OF SEARCH. THE ADDITION IS BASED ONLY ON THE MATERIAL WHICH WAS SUBMITTED BY THE ASSESSEE DURING THE ORIG INAL ASSESSMENT ORDER. THEREFORE, NO ADDITION CAN BE MADE IN ABSENC E OF ANY INCRIMINATING MATERIAL AS HELD BY HONBLE DELHI HIG H COURT IN THE CASE OF KABUL CHAWLA (SUPRA). THE ASSESSEE HAS FURNISHED ALL THE NECESSARY DOCUM ENTS SUCH AS, COPY OF RIB, COPY OF TRANSFER LETTERS, COPY OF LETTER ISSUED BY SBI SHOWING TRANSFER BOND IN FAVOUR OF THE ASSESSEE THR OUGH MODE OF GIFT. WE FIND THAT THE ONLY OBJECTION BY THE REVENUE THAT THE ASSESSEE HAS PURCHASED THIS BOND BY HIS OWN MONEY BY PAYING CASH TO THE DONOR. HOWEVER, WE FIND THAT DURING THE COURSE OF SEARCH, NO SUCH DOCUMENTS GURVINDER SINGH BHATIA (SS)116 OF 2011 AND OTHERS 12 OR EVIDENCES ESTABLISH ANY PAYMENT OF CASH BY THE A SSESSEE TO THE DONOR. WE ALSO FIND THAT ON MERIT, THIS ISSUE IS CO VERED BY THE DECISION OF THIS BENCH IN THE CASE OF ACIT VS. PHOOLCHAND AG RAWAL IN ITA NO.381/IND/2006 RELYING UPON THE DECISION OF THE HO NBLE ALLAHABAD HIGH COURT IN THE CASE OF KANCHAN SINGH VS. CIT (20 09) 221 CTR 456 (ALL) HAS HELD THAT GIFTS OF RIBS RECEIVED BY AN AS SESSEE FROM ONE NRI CANNOT BE TREATED AS INCOME OF THE ASSESSEE. WE ALS O FIND SUBSTANCE IN THE CONTENTION OF THE LD. AR OF THE ASSESSEE THA T IN VIEW OF THE DECISION OF THE ITAT, JODHPUR BENCH IN THE CASE OF DCIT VS. RAMDEV KUMAR CHYITLANGIA (2004) 89 TTJ (JD.) 346, THE BLOO D RELATIONSHIP IS NO CONDITION PRECEDENT FOR MAKING A VALID GIFT. IN VIE W OF THESE FACTS AND CIRCUMSTANCES, WE ARE OF THE CONSIDERED VIEW THAT E VEN ON MERITS OF THE CASE, THE ADDITION MADE BY THE ASSESSING OFFICE R U/S 68 OF THE ACT ON ACCOUNT OF RIB GIFT AT RS.70,29,000/- AND SUBSEQ UENTLY, ENHANCED BY THE LEARNED CIT(A) TO RS.1,00,44,348/- IS NOT SU STAINABLE. THUS, EVEN ON MERITS, GROUND NOS. 3.1 & 3.2 OF THE ASSESS EE ARE ALLOWED. SINCE COMMON ISSUE ON IDENTICAL SET OF FACTS IS INV OLVED IN BOTH THE APPEALS OF THE ASSESSEE, THE IDENTICAL ISSUE OF RES URGENT INDIA BONDS (RIB) IS ALSO ALLOWED FOR THE ASSESSMENT YEAR 2003- 04 ON THE SAME REASONING. ACCORDINGLY, THIS GROUND OF GENUINENESS OF RIB IS ALLOWED IN BOTH THE PRESENT RESPECTIVE APPEALS OF THE ASSESSEE . 20. THUS, BY FOLLOWING THE OUR ABOVE REASONING GIVE N IN THE IDENTICAL ISSUE ON SIMILAR SET OF FACTS, WE ALLOW THIS GROUND IN THE PRESENT APPEAL FILED BY THE ASSESSEE I.E. IT(SS)A NO.116/IND/2011 FOR THE A.Y. 2003-04. GROUND NOS. 3.1 & 3.2 IN IT(SS)A NO.117/IND/2011 A. Y. 2004-05 21. THESE GROUNDS ARE DIRECTED AGAINST THE CIT(A)S FINDING OF UPHOLDING AOS ACTION OF TREATING THE LONG-TERM CAP ITAL GAIN OF RS.3,75,96,228/- AS UNACCOUNTED CASH CREDITS UNDER S.68 OF THE ACT. GROUND NOS. 3.1 & 3.2 IN IT(SS)A NO.118/IND/2011 A. Y. 2005-06 22. THESE GROUNDS ARE DIRECTED AGAINST THE CIT(A)S FINDING OF UPHOLDING AOS ACTION OF TREATING THE SHORT-TERM CA PITAL GAIN OF RS.2,20,32,388/- AS UNACCOUNTED CASH CREDITS UNDER S.68 OF THE ACT. GROUND NOS. 3.1, 3.2 & 3.3 IN IT(SS)A NO.119/IND/20 11 A.Y. 2006-07 23. THESE GROUNDS ARE DIRECTED AGAINST THE CIT(A)S FINDING OF UPHOLDING AOS ACTION OF TREATING THE SHORT-TERM CA PITAL GAIN OF GURVINDER SINGH BHATIA (SS)116 OF 2011 AND OTHERS 13 RS.2,18,37,337/- AND LONG-TERM CAPITAL GAIN OF RS.9 ,91,386/- AS UNACCOUNTED CASH CREDITS UNDER S.68 OF THE ACT. 24. SINCE, THE COMMON ISSUE OF LONG TERM CAPITAL/SH ORT TERM CAPITAL GAIN IS INVOLVED IN THE ABOVE THREE APPEALS AS ABOV E, WE ARE DISCUSSING THESE THREE APPEALS SIMULTANEOUSLY TAKING FACTS FRO M THE A.Y. 2004-05 HAVING SIMILAR SET OF FACTS. 25. SHORT FACTS OF THE CASE ARE THAT THE ASSESSEE H AD DULY DISCLOSED THE FACTS OF DERIVING INCOME FROM LONG-TERM CAPITAL GAINS IN THE ORIGINAL RETURN FURNISHED MUCH PRIOR TO THE DATE OF SEARCH ( PB NO.14 TO 17). ON A PERUSAL OF THE STATEMENT OF LONG-TERM CAPITAL GAIN, FORMING PART OF THE COMPUTATION OF INCOME ITSELF, IT CAN BE OBSERVED TH AT WHILE FURNISHING THE ORIGINAL RETURN, THE ASSESSEE HAD GIVEN THE COMPLET E DETAILS AS REGARD TO THE LONG-TERM CAPITAL GAINS. THE ASSESSEE HAD FURNI SHED THE NAME OF THE COMPANIES, NUMBER OF SHARES PURCHASED AND SOLD, AMO UNT OF PURCHASES AND SALES, DATE OF PURCHASES AND SALES AND AMOUNT O F LONG-TERM CAPITAL GAIN. IT WAS SUBMITTED THAT THE ORIGINAL RETURN UND ER S.139 FOR THE ASSESSMENT YEAR UNDER CONSIDERATION WAS FILED BY TH E ASSESSEE MANUALLY AND ALONG WITH THE MANUAL RETURN, THE ASSE SSEE HAD NOT ONLY FURNISHED THE DETAILS, BUT HAD ALSO FILED THE NECES SARY DOCUMENTARY EVIDENCES IN SUPPORT OF DERIVING OF SUCH GAINS FROM SALE OF SHARES. THE CASE OF THE ASSESSEE WAS ALSO SELECTED FOR SCRUTINY UNDER S.143(3) OF THE ACT AND THE THEN ASSESSING OFFICER, AFTER CARRY ING OUT IN-DEPTH ENQUIRY AS REGARD TO VARIOUS INCOME SHOWN BY THE AS SESSEE IN HIS RETURN OF INCOME, WHICH INTER ALIA, INCLUDED THE VERIFICAT ION OF CLAIM OF LONG-TERM CAPITAL GAIN, FRAMED THE ASSESSMENT UNDER S.143(3) OF THE ACT ON 29-12- 2006 (PB PAGE NO. 354 TO 357). DURING THE COURSE OF THE ASSESSMENT PROCEEDINGS CARRIED OUT IN THE CASE OF THE ASSESSEE POST SEARCH, THE AO ISSUED A SHOW-CAUSE NOTICE TO THE ASSESSEE ON 07-12 -2009. A COPY OF GURVINDER SINGH BHATIA (SS)116 OF 2011 AND OTHERS 14 THE SHOW-CAUSE NOTICE IS PLACED AT PAGE NO. 59 & 60 OF PAPER BOOK. IN TERMS OF THE SHOW-CAUSE NOTICE, THE ASSESSEE WAS RE QUIRED BY THE AO AS TO SHOW-CAUSE THAT (I) WHY THE STCG/LTCG SHOWN I N THE RETURNS SHOULD NOT BE TREATED AS ACCOMMODATION ENTRIES WITH OUT ANY REAL PROFIT UNDER S.68; (II) WHY THESE TRANSACTIONS SHOULD NOT BE TREATED AS TRADING IN THE NATURE OF BUSINESS CONSIDERING THE MAGNITUDE OF THE SHARE DEALINGS; AND (III) TO EXPLAIN ON WHAT BASIS, SHARE S WERE PURCHASED AND SOLD BY THE ASSESSEE OF CERTAIN COMPANIES WHICH ACC ORDING TO THE AO WERE NOT WORTH INVESTING. IN RESPONSE TO SHOW-CAUSE NOTICE DATED 07-12- 2009, THE ASSESSEE, THROUGH HIS LETTER DATED 09-12- 2009 (PB PAGE NO. 65 TO 89), FURNISHED A DETAILED WRITTEN SUBMISSION BEFORE THE AO IN RESPECT OF EACH AND EVERY QUERY RAISED BY THE AO IN THE AFORESAID SHOW- CAUSE NOTICE. MEANWHILE, THE AO ISSUED A SUMMONS UN DER S.131 OF THE ACT TO THE ASSESSEE. THE RELEVANT PORTION OF THE ST ATEMENT OF THE ASSESSEE RECORDED BY THE AO IN PURSUANCE OF SUMMONS UNDER S. 131 IS ALSO REPRODUCED BY THE AO HIMSELF AT PAGE NO. 28 & 29 OF THE ASSESSMENT ORDER. ON A PERUSAL OF SUCH STATEMENT, I T IS SEEN THAT ALL THE QUESTIONS RAISED BY THE AO IN RESPECT OF SHARE TRAN SACTIONS UNDERTAKEN BY THE ASSESSEE WERE DULY ANSWERED BY THE ASSESSEE AND THE AO COULD NOT EXPRESS ANY DISSATISFACTION OR FIND ANY ADVERSI TY IN ANY OF THE ANSWERS GIVEN BY THE ASSESSEE. FINALLY, THE AO DISC ARDED THE ENTIRE EXPLANATION OF THE ASSESSEE EXPRESSING THE VIEW OF MONEY LAUNDERING AND FURTHER, RELYING UPON THE DECISION OF THE HONB LE SUPREME COURT IN THE CASE OF MCDOWELL & COMPANY LTD., HELD THE CAPIT AL GAIN AS UNEXPLAINED CASH CREDIT OF THE ASSESSEE UNDER S.68 OF THE ACT. ALTERNATIVELY, THE AO ALSO HELD THAT CONSIDERING TH E MAGNITUDE OF TRANSACTIONS, THE ENTIRE GAIN SHOULD BE TAXED AS BU SINESS INCOME OF THE ASSESSEE. THE AO HAS DEALT WITH THE SUBJECT ISSUE F ROM PAGE NO. 15 TO 52 OF HIS ORDER. THE AO HAS GIVEN HIS FINDINGS AT P AGE NO. 46 & 47 OF GURVINDER SINGH BHATIA (SS)116 OF 2011 AND OTHERS 15 THE ORDER. THE OPERATIVE PART OF THE AOS FINDINGS FIND PLACE AT PAGE NO. 52 OF THE ORDER. THE AO FROM THE COPIES OF THE VARI OUS CAPITAL ACCOUNTS FILED BY THE ASSESSEE AND THE GROUP ASSESSEES, OBSE RVED THAT THE ASSESSEE AND THE GROUP ASSESSEES HAD SHOWN AGGREGAT E SHORT-TERM CAPITAL GAIN AND LONG-TERM CAPITAL GAIN, RESPECTIVE LY OF RS.12,18,40,398/- AND RS.8,79,77,250/- IN VARIOUS ASSESSMENT YEARS FR OM SALE OF SHARES. THE AO NOTED THAT THE ASSESSEE AND GROUP ASSESSEES HAD SHOWN STCG FROM SCRIPS OF SIX COMPANIES ONLY. THE AO FROM MAKING AN ANALYSIS FROM PROFIT & LOSS ACCOUNT OF THESE COMPAN IES, FOUND THAT THERE WAS SUDDEN INCREASE IN THE PRICES OF SHARES O F THESE COMPANIES. ACCORDING TO THE AO, SUCH INCREASE IN PRICES WAS AB NORMAL AND NOT BASED ON FUNDAMENTALS. ACCORDING TO THE AO, NO PRUD ENT PERSON COULD HAVE MADE INVESTMENT IN SUCH COMPANIES. THE AO ALSO NOTICED THAT SEBI HAD CONDUCTED THE ENQUIRY AS REGARD TO THE HIK E IN THE PRICES OF THE SHARES. FINALLY, THE AO KEEPING IN VIEW THE THEORY OF MONEY LAUNDERING AND RELYING UPON THE DECISION OF THE HONBLE SUPREM E COURT IN THE CASE OF MCDOWELL & COMPANY LTD., AT OPERATIVE PARA AT PA GE NO. 52, HELD THAT THE ASSESSEE HAD BROUGHT THE UNACCOUNTED CASH IN TH E SYSTEM THROUGH SHAM AND ILLUSORY SHARE TRANSACTIONS TO AVOID THE T AX ON THE WHOLE UNACCOUNTED MONEY AND PAID ONLY 10% OF TAX. THE AO HELD SUCH CAPITAL GAIN AS UNACCOUNTED CASH CREDIT OF THE ASSESSEE CRE DITED IN HIS BOOKS OF ACCOUNT AND MADE THE ADDITION UNDER S.68 OF THE ACT . 26. MATTER CARRIED TO LEARNED CIT(A), WHO CONFIRME D THE ACTION OF THE AO IN TREATING THE LTCG AS INCOME FROM OTHER SOURCE S. HOWEVER, THE CIT(A) ALLOWED THE GROUND OF THE ASSESSEE BEFORE HI M THAT THE TRANSACTIONS OF SHARES CANNOT BE REGARDED AS TRADE IN THE NATURE. THE CIT(A) HAS DEALT WITH THE ISSUE AT PARA 2.4.1, PAGE NO. 9 OF THE ORDER. THE CIT(A), AT PARA 2.4.1, HAS GIVEN A TABLE SHOWIN G VARIOUS GROUNDS GURVINDER SINGH BHATIA (SS)116 OF 2011 AND OTHERS 16 RAISED BY THE ASSESSEE, THE ISSUE INVOLVED AND THE APPEAL OF THE ASSESSEE/ GROUP ASSESSEE WHERE THE SUBJECT ISSUE H AS BEEN DISCUSSED BY HIM. ACCORDINGLY, THE CIT(A) CONFIRMED THE ADDIT ION OF RS.3,75,96,228/-, BEING THE RE-CHARACTERIZATION OF LONG-TERM CAPITAL GAIN AS UNEXPLAINED CASH CREDIT UNDER S.68, FOLLOWING HI S OWN FINDINGS GIVEN IN THE CASE OF SHRI AMANDEEP SINGH BHATIA IN APPEAL NO. IT-227/09-10 FOR A.Y. 2006-07. 27. THE LD. AR FOR THE ASSESSEE HAS MADE ORAL AS WE LL AS WRITTEN SUBMISSION AS UNDER: AS REGARD THIS GROUND TAKEN BY THE ASSESSEE IN THE PRESENT APPEAL, IT IS SUBMITTED THAT SIMILAR GROUNDS FOR THE ASSESSMENT Y EAR 2006-07 HAS BEEN TAKEN IN THE CASE OF SHRI AMANDEEP SINGH BHATIA IN APPEAL NO. IT(SS)A 115/IND/2011. THE FACTS OF THE GROUNDS OF THE ASSES SEE IN THE PRESENT APPEAL ARE IDENTICAL WITH THAT OF THE GROUNDS OF SHRI AMAN DEEP SINGH BHATIA FOR A.Y. 2006-07. THEREFORE, IN ORDER TO AVOID REPETITION, W E WISH TO PLACE OUR RELIANCE ON OUR SYNOPSIS MADE ON THE RESPECTIVE GROUNDS MADE IN RESPECT OF SHRI AMANDEEP SINGH BHATIA FOR A.Y. 2006-07 IN APPEAL NO . IT(SS)A 115/IND/2011. RELEVANT DOCUMENTS FILED IN THE PAPER BOOK ON WHICH THE ASSESSEE IS PLACING RELIANCE FOR THESE GROUNDS PAGE NO. NATURE OF DOCUMENT FILED FOR THE PURPOSE OF FROM TO 98 99 STATEMENT SHOWING DETAILS OF LTCG FOR GIVING THE SCRIP - WISE AND DATE-WISE DETAILS OF LTCG 100 103 COPY OF DEMAT ACCOUNT ESTABLISHING THE HOLDING PERIOD OF THE SHARES 104 146 CONTRACT NOTES ISSUED BY THE BROKERS IN RESPECT OF PURCHASES OF SHARES ESTABLISHING THE PURCHASES HAVE BEEN MADE THROUGH SEBI REGISTERED BROKERS 147 180 CONTRACT NOTES ISSUED BY THE BROKERS IN RESPECT OF SALES OF SHARES ESTABLISHING THE SALES HAVE BEEN MADE THROUGH SEBI REGISTERED BROKERS GURVINDER SINGH BHATIA (SS)116 OF 2011 AND OTHERS 17 181 183 LEDGER ACCOUNT OF THE SHARE BROKER IN BOOKS OF ASSESSEE ESTABLISHING THE SHARES TRANSACTIONS 184 203 LEDGER ACCOUNT OF THE ASSESSEE IN BOOKS OF SHARE BROKER CONTAINING CONFIRMATION OF SHARE TRANSACTIONS ---- DO ---- 373 394 ABSTRACTS OF THE BANK ACCOUNT OF THE ASSESSEE SHOWING PAYMENT FOR PURCHASES ESTABLISHING THAT THE PAYMENTS AGAINST SHARE PURCHASES HAVE BEEN MADE THROUGH BANKING CHANNELS 373 394 ABSTRACTS OF THE BANK ACCOUNT OF THE ASSESSEE SHOWING SALES PROCEEDS OF SHARES ESTABLISHING THAT THE RECEIPTS OF SALES PROCEEDS HAVE BEEN THROUGH BANKING CHANNELS 204 275 COPIES OF QUOTATIONS OF RELEVANT STOCK EXCHANGE HIGHLIGHTING THE TRADING VOLUME OF SHARES AND THEIR PRICE ON THE RELEVANT DATE OF TRANSACTION OF PURCHASES AND SALES ESTABLISHING THE MARKET PRICE OF THE SCRIP ON THE PREVAILING DAY OF PURCHASE AND SALE 351 357 COPY OF THE ORIGINAL ASSESSMENT ORDER PASSED U/S. 143(3) OF THE ACT IN THE CASE OF THE ASSESSEE FOR A.Y. 2004-05 ESTABLISHING THAT THE DURING THE COURSE OF ORIGINAL ASSESSMENT PROCEEDINGS UNDER S.143(3), THE THEN AO HAS DULY EXAMINED AND VERIFIED THE SUBJECT ISSUE OF LTCG. 28. LD. DRS HAVE RELIED ON THE ORDERS OF THE REVENU E AUTHORITIES AND SUBMITTED THAT OUR ARGUMENTS ADVANCED IN THE CASE O F AMANDEEP SINGH BHATIA ON IDENTICAL FACTS MAY BE TAKEN INTO CONSIDE RATION. 29. WE HAVE HEARD RIVAL CONTENTIONS OF BOTH THE PAR TIES AND PERUSED MATERIAL AVAILABLE ON RECORD. THE CIT(A) HAS RELIED UPON HIS OWN GURVINDER SINGH BHATIA (SS)116 OF 2011 AND OTHERS 18 FINDINGS GIVEN IN THE CASE OF SHRI AMANDEEP SINGH B HATIA. WE FIND THAT THIS ISSUE HAS ALREADY BEEN DEALT WITH BY US IN THE CASE OF ONE OF THE GROUP ASSESSEES NAMELY, AMANDEEP SINGH BHATIA IN AP PEAL NO. IT(SS)A NO.115/IND/2011 FOR A.Y. 2006-07, WHEREIN W E HAVE HELD AS UNDER: IN VIEW OF THE ABOVE FACTS AND CIRCUMSTANCES OF TH E CASE, VARIOUS DOCUMENTARY EVIDENCES PLACED ON RECORD AND IN THE L IGHT OF THE VARIOUS JUDICIAL PRONOUNCEMENTS, WE ARE OF THE CONSIDERED V IEW THAT THERE WAS ABSOLUTELY NO JUSTIFICATION FOR BOTH THE AUTHORITIE S BELOW IN DISBELIEVING THE GENUINENESS OF THE LONG TERM CAPITAL GAIN AND S HORT TERM CAPITAL GAIN SHOWN BY THE ASSESSEE IN HIS RETURN OF INCOME, MERE LY ON GUESSWORK, CONJECTURES AND SURMISES. ACCORDINGLY, THESE ADDITI ONS ARE DIRECTED TO BE DELETED. CONSEQUENTLY, GROUND NOS. 3.1 TO 3.3 ON THE ISSUE OF GENUINENESS OF LONG TERM CAPITAL GAIN/SHORT TERM CA PITAL GAIN ARE ALLOWED. SINCE COMMON ISSUE ON SIMILAR SET OF FACTS AND CIRCUMSTANCES ARE INVOLVED IN THE ASSESSMENT YEAR 2005-06, WE, FO LLOWING OUR ABOVE DECISION GIVEN IN THE ASSESSMENT YEAR 2006-07, ALLO W THE GROUND NOS.3.1 & 3.2 ON THE ISSUE OF LONG TERM CAPITAL GAI N/SHORT TERM CAPITAL GAIN FOR THE ASSESSMENT YEAR 2005-06 TOO IN ASSESSE ES APPEAL IT(SS)A NO.114/IND/2014 . 30. THUS, BY FOLLOWING OUR ABOVE ORDER ON THE IDENT ICAL ISSUE ON SIMILAR SET OF FACTS, WE ALLOW THE PRESENT GROUNDS IN RESPE CT OF LTCG/STCG IN THE PRESENT THREE APPEALS FILED BY THE ASSESSEE I.E . IT(SS)A NO.117 TO 119/IND/2011 FOR THE A.YS. 2004-05 TO 2006-07. GROUND NO. 4 31. THIS GROUND OF APPEALS OF THE ASSESSEE IS DIREC TED AGAINST CHARGING OF INTEREST UNDER S. 234A AND 234B, WHICH IS CONSEQUENTIAL IN NATURE, THEREFORE, NO SEPARATE ADJUDICATION IS REQU IRED. DEPARTMENTAL APPEAL IT(SS)A NO.299/IND/2011 A.Y. 20 08-09 32. THIS APPEAL FILED BY THE DEPARTMENT IS FILED AG AINST THE ORDER OF LD. CIT(A)-I, INDORE DATED 05.8.2011. GURVINDER SINGH BHATIA (SS)116 OF 2011 AND OTHERS 19 33. AT THE OUTSET, LD. COUNSEL FOR THE ASSESSEE SUB MITTED THAT THIS APPEAL IS NOT MAINTAINABLE AS TAX EFFECT IN THE DEP ARTMENTAL APPEAL IS BELOW RS.10 LACS. LD. DRS DID NOT CONTROVERT THE SU BMISSION MADE BY THE LD. COUNSEL FOR THE ASSESSEE. 34. WE HAVE HEARD RIVAL CONTENTIONS OF BOTH THE PAR TIES AND PERUSED MATERIAL AVAILABLE ON RECORD. THE DELETION OF THE A DDITIONS AT RS.13,23,000/- AND RS.6,54,825/-, RESPECTIVELY, HAS BEEN CHALLENGED BEFORE THIS TRIBUNAL. WE FIND THAT ON THE DISPUTED AMOUNT OF ADDITIONS, THE TAX EFFECT COMES TO BELOW RS.10 LACS. THEREFORE , THE DEPARTMENTAL APPEAL BEING FILED IN CONTRAVENTION WITH THE CBDT C IRCULAR NO.21/2015 DATED 10.12.2015 DESERVES TO BE DISMISSED BEING NOT MAINTAINABLE AS ALSO WE ARE TAKING CONSISTENT VIEW IN THE APPEALS W HICH ARE PENDING BEFORE THIS TRIBUNAL HAVING TAX EFFECT BELOW RS.10 LACS. ACCORDINGLY, THIS DEPARTMENTAL APPEAL IS DISMISSED BEING LOW TAX EFFE CT. 35. FINALLY, ASSESSEES APPEALS ARE PARTLY ALLOWED WHEREAS DEPARTMENTAL APPEAL IS DISMISSED. ORDER WAS PRONOUNCED IN THE OPEN COURT ON 18.5.201 6. SD/- (B.C. MEENA) ACCOUNTANT MEMBER SD/- ( D.T. GARASIA) JUDICIAL MEMBER DATED : 17.8.2016 COPY TO: ASSESSEE/RESPONDENT/CIT(A)/CIT/DR, INDORE