MR DEEPAK JAGDISHRAM GUPTA , MUMBAI V. INCOME TAX OFFICER, WARD-17(1)(3), MUMBAI

ITA 3/MUM/2023

AI Insights

The case involves Deepak Jagdishram Gupta, who appealed against the order of the Commissioner of Income Tax (Appeals) at the National Faceless Appeal Centre, which confirmed the additions made by the Assessing Officer for the Assessment Year 2012-13. The additions were based on the assessee's involvement in transactions deemed to be for obtaining bogus business losses and capital gains. The Tribunal noted the assessee's non-compliance and lack of representation, leading to the decision being made based on the Departmental Representative's arguments and the available records. The Tribunal found no infirmity in the CIT(A)'s order and dismissed the appeal.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 125902 (ITAT-MUMBAI)
• Duration Of Justice: 4 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-05-2023
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: D
• Next Hearing Date: 28-02-2023
• Assessment Year: 2012-2013
• Appeal Filed On: 01-01-2023
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Unexplained expenditure; Transactions in derivatives
• Section: 147; 68; 148; 144; 69C; 13

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL “D” BENCH, MUMBAI BEFORE SHRI PRASHANT MAHARISHI, AM AND MS. KAVITHA RAJAGOPAL, JM IT A N o. 3 /M u m /2 02 3 ( A s s e ss me nt Y ea r: 20 1 2- 13 ) Deepak Jagdishram Gupta C/o. Harshit N. Metha 16, Chemox House, 5 th Floor, Barrack Road, Opp. Bombay Hospital, Above Panchavati Gaurav Hotel, New Marine Lines, Mumbai-400 020 V s. ITO, Ward-17(1)(3) Mumbai P A N / G I R N o. A CWP G 18 23 D (Appellant) : (Respondent) Assessee by : None Revenue by : Smt. Mahita Nair D a te o f H e a r i n g : 01.03.2023 D ate of P ro n ou n ce me n t : 19.05.2023 O R D E R Per Kavitha Rajagopal, J M: This appeal has been filed by the assessee, challenging the order of the learned Commissioner of Income Tax (Appeals) (‘ld.CIT(A) for short), National Faceless Appeal Centre (‘NFAC’ for short) u/s.250 of the Income Tax Act, 1961 (‘the Act'), pertaining to the Assessment Year (‘A.Y.’ for short) 2012-13. 2. The assessee has challenged the various additions made by the Assessing Officer (A.O. for short) and confirmed by the ld. CIT(A). As there was no representation on behalf of the assessee, we hereby proceed to decide the appeal sans the assessee by hearing the learned Departmental Representative (ld. DR for short) for the Revenue and on perusal of the materials available on record. 2 ITA No. 3 / M u m / 2 0 2 3 ( A . Y . 2 0 1 2 - 1 3 ) Deepak Jagdishram Gupta vs. ITO 3. The brief facts are that the assessee is an individual and had not filed its return of income for the year under consideration. Based on the information received from DDIT(Investigation) pursuant to a search and seizure action carried on Shri Naresh Jain and his associates, it was found that certain persons were involved in the transaction on stock exchange for the purpose of obtaining bogus business loss, long term capital gain and short term capital loss for various beneficiaries in the script of VMS Industries Limited. It was found that the assessee was one of the beneficiary of such concern for obtaining bogus sale transaction amounting to Rs.58,25,963/-. The assessee’s case was reopened u/s. 147 of the Act by notice dated 31.03.2019 u/s. 148 of the Act. It is observed that the assessee has traded in shares of the following companies tabulated below: BSE Quantity Amount Scrip Buy Sell Buy (Rs.) Sell (Rs.) LTCG/STCL VMS Industries (Scrip code 533427) 162246 162446 57,61,818 58,25,962.8 64,144 Other than VMS Scrip 22155892 2215892 13,83,39,559 13,93,74,672 10,35,113 Total 10,99,257 NSE Capital Market 69164007 69166364 258850353.5 2272278553.9 3,15,71,799 F&O 1252990 1252990 10811194.4 10584973 Loss Total 3,15,71,799 Grand total 3,26,71,056 4. The A.O. passed the assessment order u/s. 144 r.w.s. 147 of the Act for the reason that the assessee has failed to furnish the relevant details sought for by the A.O, thereby making an addition of Rs.3,26,71,056/- u/s. 68 of the Act along with the other additions. 5. Aggrieved by the impugned addition, the assessee was in appeal before the ld. CIT(A), who confirmed the said addition made by the A.O. for the reason that the assessee has failed to furnish the relevant details even before the first appellate authority. 3 ITA No. 3 / M u m / 2 0 2 3 ( A . Y . 2 0 1 2 - 1 3 ) Deepak Jagdishram Gupta vs. ITO 6. The assessee is in appeal before us, challenging the impugned order of the ld. CIT(A). 7. The learned Departmental Representative (ld. DR for short) for the Revenue contended that the assessee has habitually been non compliant before the lower authorities and before the Tribunal as well. The ld. DR further stated that it is inferred that the assessee has no material evidence to substantiate his claim. The ld. DR relied on the order of the lower authorities. 8. We have heard the ld. DR and perused the materials on record. It is observed that as per the submission of the assessee that the assessee has wound up all his proprietary business and has been employed since A.Y. 2016-17, and had shifted his residence to Sonipat, Hairyana. The assessee contends that he was unaware of the assessment proceedings and, hence, remained ex parte before the lower authorities. The assessee further submitted that the assessee was into trading in equity and was transacting on daily basis without any intention of investing or purchasing of shares in penny stock. The assessee contended that the impugned addition made by the A.O. was on account of income from business and profession and has also made addition u/s. 68 and 69C of the Act as unexplained cash credit. It is observed that the assessee apart from the above submission has not furnished any details or documentary evidences to support his claim neither before the A.O. nor before the ld. CIT(A). It is also observed that the assessee’s contention that he had incurred trading losses in equity transaction was not supported by any documentary evidences. The A.O. has proceeded to make the addition based on the data received from NSE/BSE and on the basis of the entries of profit made in the 4 ITA No. 3 / M u m / 2 0 2 3 ( A . Y . 2 0 1 2 - 1 3 ) Deepak Jagdishram Gupta vs. ITO transaction of penny stock script, thereby treating the same as ‘unexplained expenditure’. The A.O. made an addition of 3% on the profits pertaining to the alleged penny stock. The addition on account of interest received on income tax refund which was alleged to be not offered for tax was also made by the A.O. and confirmed by the ld. CIT(A). The assessee has failed to corroborate his claim by way of documentary evidences neither before the lower authorities nor before us. In the absence of any evidence in rebuttal of the addition made by the A.O., we hereby deem it fit to confirm the addition made by the A.O. and confirmed by the ld. CIT(A). We do not find any infirmity in the order of the ld. CIT(A) in upholding the impugned addition and, hence, the same does not require any interference. 9. In the result, the appeal filed by the assessee is dismissed. Order pronounced in the open court on 19.05.2023 Sd/- sd/- (Prashant Maharishi) (Kavitha Rajagopal) Accountant Member Judicial Member Mumbai; Dated : 19.05.2023 Roshani , Sr. PS Copy of the Order forwarded to : 1. The Appellant 2. The Respondent 3. CIT - concerned 4. DR, ITAT, Mumbai 5. Guard File BY ORDER, (Dy./Asstt. Registrar) ITAT, Mumbai