MR.BANSILAL I JAIN, MUMBAI V. PR.CIT-28, MUMBAI

ITA 5553/MUM/2018

• Counselvise Citation: [2021] 109 COUNSELVISE.COM (IT) 9402 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 3 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-01-2021
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: B
• Assessment Year: 2014-2015
• Appeal Filed On: 01-10-2018
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Assessee Lawyers: VALLABH PARMAR
• Keywords: Opportunity of being heard; Cost of acquisition; Assessment record; Condonation of delay; Set aside
• Section: 143(3); 143(1); 2(A); 263

Judgement Text

ITA NO.5553/MUM/2018 A.Y.2014 - 15 MR. BANSILAL I. JAIN VS. PR. CIT - 28 1 IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, MUMBAI BEFORE SHRI M. BALAGANESH, ACCOUNTANT MEMBER AND SHRI RAVISH SOOD, JUDICIAL MEMBER ITA NO . 5553/MUM/2018 (ASSESSMENT YEAR: 2014 - 15 ) MR. BANSILAL I. JAIN SHOP NO. - 1, RATANDEEP BLDG, SECTOR 9, VASHI, NAVI MUMBAI 400703 VS. PR. CIT - 28 ROOM NO. 301, 3 RD FLOOR, TOWER NO.6, VASHI RAILWAY STATION COMPLEX, VASHI, NAVI MUMBAI 400703 PAN AAHPJ9866C (APPELLANT) (RESPONDENT) APPELLANT BY: SHRI VALLABH PARMAR, A.R RESPONDENT BY: SHRI PURUSHOTTAM TRIPURI , CIT D.R DATE OF HEARING: 17 .12.2020 DATE OF PRONOUNCEMENT: 04 . 01.2021 O R D E R PER RAVISH SOOD, JM THE PRESENT APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER PASSED BY THE PRINCIPAL COMMISSIONER OF INCOME TAX - 28, MUMBAI (HEREINAFTER REFERRED TO AS PR. CIT) UNDER SEC. 263 OF THE INCOME TAX ACT, 1961 (FOR SHORT ACT) DATED 27.02.2018 FOR A.Y. 2014 - 15. THE ASSESSEE HAS ASSAILED THE IMPUGNED ORDER ON THE FOLLOWING GROUND S OF APPEAL BEFORE US: 1. ON FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW LD. PR. CIT ERRED IN SETTING ASIDE THE ORDER OF AO U/S 143(3) DATED 30 - 06 - 2016 AND DIRECTING THE AO TO PASS FRESH ASSESSMENT ORDER IN ACCORDANCE WITH THE LAW. 2. ON FACTS AND CIRCUMSTANCES OF THE CASE AND - IN LAW LD. PR. CIT ERRED IN SETTING ASIDE THE ORDER OF AO U/S 143(3) DATED 30 - 06 - 2016 AND DIRECTING THE AO TO PASS FRESH ASSESSMENT ORDER IN AC CORDANCE WITH THE LAW AND AT THE SAME TIME DIRECTING THE AO TO DISALLOW EXEMPTION OF RS. 58,56,466/ - U/S 10(38) LTCG ON SALE OF SHARES OF NYSSACORP THUS DIRECTIONS ARE CONTRADICTORY. ITA NO.5553/MUM/2018 A.Y.2014 - 15 MR. BANSILAL I. JAIN VS. PR. CIT - 28 2 3. ON FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW LD. PR.CIT ERRED IN GIVING FINDING THAT APPELLANT HAS VOLUNTARILY DISCLOSED INCOME OF RS 40,67,350/ - ON ACCOUNT OF LTCG ON SAME ISSUE IN A.Y. 2013 - 14, WITHOUT APPRECIATING THE FACT THAT VOLUNTARY DISCLOSURE OF LTCG WAS SALE OF SHARES OF UNISYS SOFTWARE IN A.Y. 2013 - 14 AND NOT SHARES OF 'NYSSACORP' WHICH WERE SOLD DURING THE YEAR, THUS SCRIP WERE DIFFERENT. 4. ON FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW LD. PR. CIT ERRED IN HOLDING THAT ORDER OF AO U/S 143(3) IS ERRONEOUS IN SO FAR AS IT IS PREJUDICIAL TO THE INTEREST OF REVENUE WITHOUT APPRECIATING THE FACT THAT ISSUE OF TAXABILITY OF LTCG ON SALE OF SHARES OF NYSSACORP WAS FULLY EXAMINED BY AO AT THE TIME OF ASSESSMENT PROCEEDINGS AND ONLY AFTER EXAMINING SUCH ISSUE AO SATISFIED HIMSELF THAT SAME IS EXEMPT AND ACCORDINGLY PASSED ORDER U/S 143(3). 5. ON FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW LD. PR. CIT ERRED IN HOLDING THAT ORDER OF AO U/S 143(3) IS ERRONEOUS IN SO FAR AS IT IS PREJUDICIAL TO THE INTEREST OF REVENUE WITHOUT APPRECIATING THE FACT THAT SHARES OF NYSSACORP WERE GENUINELY PURCHASED IN A.Y. 2013 - 14 AND SUCH PURCHASES WERE NOT DISPUTED IN A.Y. 2013 - 14 IN SCRUTINY ASSESSMENT ORDER AND FURTHER THERE ARE NO ALLEGATIONS BY SEBI OR INVESTIGATION WING OF INCOME TAX THAT TRANSACTIONS IN THESE SHARES ARE NOT GENUINE 6. THE APPELLANT CRAVES, TO CONSIDER EACH OF THE ABOVE GROUND OF APPEAL WITHOUT PREJUDICE TO EACH OTHER AND CRAVES LEAVE TO ADD, ALTER, DELETE OR MODIFY ALL OR ANY OF THE ABOVE GROUNDS OF APPEAL. 2 BRIEFLY STATED, THE ASSESSEE WHO IS ENGAGED IN THE BUSINESS OF TRADING IN GOLD JEWELLERY HAD E - FILED HIS RETURN OF INCOME FOR A.Y 2014 - 15 ON 25.09.2014, DECLARING A TOTAL INCOME OF RS.11,40,230/ - . THE RETURN OF INCOME FILED BY THE ASSESSEE WAS INITIALLY PROCESSED AS SUCH UNDER SEC. 143(1) OF THE ACT. SUBSEQUENTLY, THE INCOME OF THE ASSESSEE WAS ASSESSED BY THE A.O VIDE HIS ORDER PASSED UNDER SEC. 143(3) DATED 30.06.2016 AT RS.12,35,940/ - . 3. AFTER CULMINATION OF THE ASSESSMENT PROCEEDINGS THE PR. CIT CALLED FOR THE ASSESSMENT RECORDS OF THE ASSESSEE. I T WAS OBSERVED BY THE PR. CIT THAT THE ASSESSEE HAD CLAIMED TO HAVE PURCHASED 500 SHARES OF M/S RAVINAY TRADING CORPORATION LTD. (NYSSACORP) ON 07.08. 2012 FOR RS.9,03,759.35, WHICH AFTER A LAPSE OF ONE YEAR WERE SOLD BY HIM ON DIFFERENT DATES WITH A RESULTANT PROFIT OF RS.59,48,750/ - , AS UNDER: NAME DATE OF PURCHASE QTY PURCHASE COST SALES DATE QTY AMOUNT PROFIT LTCG/STCG NYSSACORP 07.08.2012 5000 0 903759 30.10.2013 10000 1367853.31 12.11.2013 10000 1342937.94 10.12.2013 7738 1064270.14 12.12.2013 2454 340946.25 13.12.2013 10000 1871890.03 ITA NO.5553/MUM/2018 A.Y.2014 - 15 MR. BANSILAL I. JAIN VS. PR. CIT - 28 3 16.12.2013 5000 698166.91 17.12.2013 4500 623960.89 19.12.2013 308 42484.26 5948750.65 LTCG 4. ON A PERUSAL OF THE CONTRACT NOTES DATED 09.06.2016 IT WAS GATHERED BY THE PR.CIT THAT THE ASSESSED HAD SOLD THE AFORESAID SHARES AT A TIME WHEN THE COMPANY HAD DECLARED A LOSS OF RS.1.43 CRORE IN THE THIRD QUARTER. APROPOS THE ASSESSEES CLAIM OF LTCG OF RS.58,56,466/ - ON SALE OF THE AFORESAID SHARES AS EXEMPT UNDER SEC.10(38) OF THE ACT , THE PR. CIT WAS OF THE VIEW THAT THE A.O WHILE FRAMING THE ASSESSMENT HAD ACCEPTED THE SAME WITHOUT MAKING ANY VERIFICATION AS REG ARDS THE GENUINENESS/CORRECTNESS OF THE PURCHASE/SALE TRANSACTIONS UNDER CONSIDERATION . HOLDING A CONVICTION THAT THE FAILURE ON THE PART OF THE A.O IN ALLOWING THE ASSESSEES CLAIM OF EXEMPTION UNDER SEC.10(38) WITHOUT MAKING ANY VERIFICATION AS REGARDS T HE GENUINENESS AND CORRECTNESS OF THE AFORESAID SHARE TRANSACTIONS HAD RENDERED THE ASSESSMENT ORDER PASSED BY HIM AS ERRONEOUS INSOFAR IT WAS PREJUDICIAL TO THE INTEREST OF THE REVENUE THE PR. CIT ISSUED A SHOW CAUSE NOTICE ( FOR SHORT SCN ) DATED 12.09.2017 THEREIN CALLING UPON THE ASSESSEE TO EXPLAIN AS TO WHY THE ASSESSMENT ORDER PASSED BY THE A.O MAY NOT BE REVISED. IN REPLY, IT WAS SUBMITTED BY THE ASSESSEE THAT HE HAD IN THE COURSE OF THE ASSESSMENT PROCEEDINGS FURNISHED THE REQUISITE DETAILS AND DOCUMENTS AS WERE CALLED FOR BY THE A.O. AS REGARDS THE PURCHASE/SALE OF SHARES CARRIED OUT DURING THE YEAR UNDER CONSIDERATION IT WAS THE CLAIM OF THE ASSESSEE THAT THE DOCUMENTS SUBSTANTIATING THE GENUINENESS AND VERACITY OF THE AFORESAID TRANSACTION S VIZ. PURCHASE BILLS OF SHARES, SALE BILLS OF SHARES, COPY OF DEM AT ACCOUNT , COPY OF THE ASSESSEES ACCOUNT WITH THE BROKER VIZ. INDIA INFOLINE LTD . , COPY OF RETURN OF INCOME AND BALANCE SHEET WERE DULY FILED IN THE COURSE OF THE ASSESSMENT PROCEEDINGS. A PART FROM THAT, IT WAS THE CLAIM OF THE ASSESSEE THAT THE AFORESAID SHARE TRANSACTION OF PURCHASE AND SALE OF SHARES WAS CARRIED OUT BY HIS BROKER VIZ. INDIA INFOLINE LTD. THROUGH RECOGNIZED STOCK EXCHANGE. I T WAS THE CLAIM OF THE ASSESSEE THAT AS THE A.O WHILE FRAMING THE ASSESSMENT HAD ONLY AFTER VETTING THE AFORESAID SHARE TRANSACTIONS TO HIS SATISFACTION ACCEPTED ITA NO.5553/MUM/2018 A.Y.2014 - 15 MR. BANSILAL I. JAIN VS. PR. CIT - 28 4 THE SAME , THEREFORE, THE PR. CIT WAS DIVESTED OF HIS JURISDICTION TO REVISE THE ASSESSMENT ORDER U/S 263 OF THE ACT . 5. AFTER DELIBERATING ON THE CONTENTIONS ADVANCED BY THE ASSESSEE THE PR.CIT WAS HOWEVER NOT PERSUADED TO SUBSCRIBE TO THE SAME. OBSERVING, THAT THE A.O WHILE FRAMING THE ASSESSMENT HAD FAILED TO VERIFY THE GENUINENESS /CORRECTNESS OF THE AFORESAID SHARE TRANSACTIONS AND HAD SUMMARILY ALLOWED THE ASSESSEES CLAIM OF EXEMPTION OF RS. 58,56,466/ - UNDER SEC.10(38), THE PR. CIT WAS OF THE VIEW THAT THE ASSESSMENT ORDER PASSED BY HIM U/S 143(3), DATED 30.06.2016 WAS RENDERED AS ERRONEOUS INSOFAR IT WAS PREJUDICIAL TO THE INTEREST OF THE REVENUE WITHIN THE MEANING OF SEC.263 OF THE ACT. IN ORDER TO SUPPORT HIS AFORESAID CONVICTION SUPPORT WAS DRAWN BY THE PR. CIT FROM THE FACT THE ASSESSEE IN THE IMMEDIATELY PRECEDING YEAR I.E A.Y 2013 - 14 HAD VOLUNTARILY DISCLOSED AN INCOME OF RS.40,67,350/ - ON ACCOUNT OF LTCG AND HAD PAID TAXES THEREON. ACCORDINGLY, THE PR. CIT B EING OF THE VIEW THAT THE A.O WHILE FRAMING THE ASSESSMENT HAD FAILED TO CARRY OUT NECESSARY VERIFICATION S AS REGARDS THE AUTHENTICITY OF THE AFORESAID SHARE TRANSACTIONS THEREIN SET ASIDE THE ASSESSMENT ORDER WITH A DIRECTION TO THE A.O TO FRAME A FRESH ASSESSMENT ORDER IN ACCORDANCE WITH LAW AFTER AFFORDING AN OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. AT THE SAME T IME, THE PR. CIT ALSO DIRECTED THE A.O TO DISALLOW THE ASSESSEES CLAIM OF EXEMPTION OF LTCG OF RS.58,56,466/ - RAISED UNDER SEC. 10(38) OF THE ACT. 6. AGGRIEVED, THE ASSESSEE HAS ASSAILED THE ORDER PASSED BY THE PR. CIT UNDER SEC. 263, DATED 27.02.2018 IN APPEAL BEFORE US. AT THE VERY OUTSET OF THE HEARING OF THE APPEAL IT WAS SUBMITTED BY THE LD. AUTHORIZED REPRESENTATIVE (FOR SHORT A.R) FOR THE ASSESSEE THAT THE PRESENT APPEAL INVOLVED A DELAY OF 142 DAYS. EXPLAINING THE REASONS LEADING TO THE DELAY IN FILING OF THE PRESENT APPEAL IT WAS SUBMITTED BY THE LD. A.R THAT THE SAME HAD OCCASIONED, FOR THE REASON, THAT THE IMPUGNED ORDER PASSED BY THE PR.CIT U/S 263 , DATED 27.02.2018 WAS THOUGH SERVED UPON THE ASSESSEES EMPLOYEE VIZ. MR. JITESH CHAUHAN , HOWEVER, THE LATTER FORGOT TO DELIVER THE SAME TO THE ITA NO.5553/MUM/2018 A.Y.2014 - 15 MR. BANSILAL I. JAIN VS. PR. CIT - 28 5 ASSESSEE. IT WAS STATED BY THE LD. A.R THAT THE IMPUGNED ORDER WAS HANDED OVER BY THE EMPLOYEE I.E MR. JITESH CHAUHAN TO THE ASSESSEE ONLY ON 28.09.2018. IT WAS SUBMITTED BY THE LD. A.R THAT AFTER REC EIVING THE IMPUGNED ORDER THE ASSESSEE IMMEDIATELY DELIVERED THE SAME TO HIS TAX CONSULTANT AND INVOLVING NO FURTHER LOSS OF TIME FILED THE PRESENT APPEAL ON 01.10.2018. IN THE BACKDROP OF THE AFORESAID FACTS IT WAS SUBMITTED BY THE LD. A.R THAT AS THE DEL AY INVOLVED IN FILING OF THE PRESENT APPEAL HAD OCCURRED ON ACCOUNT OF A BONAFIDE REASON, THEREFORE, THE SAME MAY BE CONDONED. IN ORDER TO DISPEL ANY DOUBTS AS REGARDS THE AFORESAID FACTUAL POSITION SO PROJECTED BEFORE US THE LD. A.R TOOK US THROUGH THE A FFIDAVIT S OF THE ASSESSEE I.E SHRI BANSILAL C.JAIN AND THAT OF THE LATTERS EMPLOYEE I.E SHRI. JITESH CHAUHAN . 7. PER CONTRA, THE LD. DEPARTMENTAL REPRESENTATIVE (FOR SHORT D.R) DID NOT OBJECT TO THE SEEKING OF CONDONATION OF DELAY IN FILING OF THE PRES ENT APPEAL BY THE ASSESSEE. 8. WE HAVE HEARD THE AUTHORIZED REPRESENTATIVES FOR BOTH THE PARTIES AND PERUSED THE MATERIAL AVAILABLE ON RECORD. IN OUR CONSIDERED VIEW THE FACT THAT THE DELAY IN FILING OF THE PRESENT APPEAL HAD OCCASIONED ON ACCOUNT OF FAILURE ON THE PART OF THE ASSESSEES EMPLOYEE VIZ. SHRI JITESH CHAUHAN WHO HAD INADVERTENTLY FAILED TO TIMELY DELIVER THE IMPUGNED ORDER TO THE ASSESSEE IS SUBSTANTIATED FROM THE AFORESAID AFFIDAVITS TO WHICH OUR ATTENTION HAD BEEN DRAWN BY THE LD. A.R . IN FACT, THE ASSESSEES EMPLOYEE VIZ. SH. JITESH CHAUHAN HAD IN HIS AFFIDAVIT CATEGORICALLY ADMITTED THAT THE DELAY IN DELIVERING THE IMPUGNED ORDER WAS ON ACCOUNT OF AN INADVERTENT LAPSE ON HIS PART. IN OUR CONSIDERED VIEW THE DELAY IN FILING OF THE PRESENT APPEAL DOES NOT SMACK OF ANY MALAFIDE OR LACKADAISICAL APPROACH ON THE PART OF THE ASSESSEE BUT IS BACKED BY AN INADVERTENT LAPSE ON THE PART OF HIS EMPLOYEE. IN THE BACKDROP OF THE AFORESAID FACTS W E ARE OF A STRONG CONVICT ION THAT AS THERE IS A JUSTIFIABLE REASON EXPLAINING THE DELAY OF 142 DAYS INVOLVED IN FILING OF THE PRESENT APPEAL BY THE ASSESSEE , THEREFORE, THE SAME MERITS TO BE CONDONED. ACCORDINGLY, WE ITA NO.5553/MUM/2018 A.Y.2014 - 15 MR. BANSILAL I. JAIN VS. PR. CIT - 28 6 CONDONE THE DELAY OF 142 DAYS INVOLVED IN FILING OF THE PRESENT APPEAL BY THE ASSESSEE . 9. ADVERTING TO THE MERITS OF THE APPEAL T HE LD. A.R TOOK US THROUGH THE RELEVANT FACTS OF THE CASE. IT WAS AVERRED BY THE LD. A.R THAT THE A.O WHILE FRAMING THE ASSESSMENT HAD CALLED FOR THE REQUISITE DOCUMENTS PERTAINING TO PURC HASE/SALE OF SHARE S OF M/S RAVINAY TRADING CORPORATION LIMITED (NYSSACORP) AND HAD ONLY AFTER PERUSING THE SAME TO HIS SATISFACTION ACCEPTED THE ASSESSEES CLAIM OF EXEMPTION OF RS. 58,56,466/ - RAISED UNDER SEC. 10(38) OF THE ACT. IN ORDER TO BUTTRESS HIS AFORESAID CLAIM THE LD. A.R TOOK US THROUGH THE RELEVANT PAGES OF THE A SSESSEES PAPER BOOK ( FOR SHORT APB ). I N ORDER TO SUPPORT HIS CLAIM THAT DOCUMENTS EVIDENC ING THE AFORESAID SHARE TRANSACTIONS W ERE FILED BY THE ASSESSEE IN THE COURSE OF THE ASSESSMENT PROCEEDINGS THE LD. A.R TOOK US THROUGH THE COPIES OF THE CONTRACT NOTES AND THE DEMAT ACCOUNT WHICH WERE THERE BEFORE THE A.O . ON BEING QUERIED AS TO WHETHER THE A.O WHILE FRAMING THE ASSESSMENT HA D CALLED FOR ANY DETAILS AS REGARDS THE AFORESAID SHARE TRANSACTIONS THE LD. A.R TOOK US THROUGH A NOTICE ISSUED UNDER SEC. 142(1), DATED 11.04.2016. IT WAS STATED BY THE LD. A.R THAT PURSUANT TO A QUERY RAISED BY THE A.O AS REGARDS THE ADDITION MADE TO TH E ASSESSEES CAPITAL ACCOUNT FOR THE YEAR UNDER CONSIDERATION DOCUMENT S IN SUPPORT OF THE AFORESAID SHARE TRANSACTIONS WERE PLACED ON HIS RECORD. AS REGARDS THE VIEW TAKEN BY THE PR. CIT THAT A SIMILAR ISSUE WAS INVOLVED IN THE CASE OF THE ASSESSEE FOR T HE IMMEDIATELY PRECEDING YEAR I.E A.Y 2013 - 14 , IT WAS SUBMITTED BY THE LD. A.R THAT THE SAID OBSERVATION OF THE REVISIONAL AUTHORITY WAS ABSOLUTELY INCORRECT AND IN FACT OUT OF CONTEXT . I T WAS SUBMITTED BY THE LD. A.R THAT IN A.Y 2013 - 14 THE ASSESSEE HAD SOLD SHARES OF UNISYS SOFTWARE. IT WAS SUBMITTED BY THE LD. A.R THAT AS UNISYS SOFTWARE WAS SUBJECTED TO CERTAIN INVESTIGATION S BY SEBI, THEREFORE, THE ASSESSEE ONLY IN ORDER TO BUY PEACE OF MIND HAD OFFERED LTCG ON SALE OF SHARES OF THE SAID COMPANY UNDER THE IDS SCHEME . IT WAS AVERRED BY THE LD. A.R THAT THE PR.CIT WAS IN ERROR IN DRAWING ADVERSE INFERENCES ON THE BASIS OF THE AFORESAID TRANSACTION WHICH HAD NO NEXUS WITH THE SALE OF SHARES BY THE ASSESSEE ITA NO.5553/MUM/2018 A.Y.2014 - 15 MR. BANSILAL I. JAIN VS. PR. CIT - 28 7 DURING THE YEAR U NDER CONSIDERATION. ADVERTING TO THE ADDITIONAL GROUND OF APPEAL THAT WAS RAISED BY THE ASSESSEE, IT WAS SUBMITTED BY THE LD. A.R THAT THE VERY BASIS FOR REVISING OF THE ASSESSMENT ORDER WAS DIVORCED FROM THE BAS IS ON WHICH THE ASSESSMENT ORDER WAS INITIAL LY SOUGHT TO BE REVISED BY THE PR. CIT VIDE HIS SCN DATED 12.09.2017 . IT WAS SUBMITTED BY THE LD. A.R THAT DE HORS AFFORDING OF ANY OPPORTUNITY OF BEING HEARD TO THE ASSESSEE AS REGARDS THE ISSUE ON WHICH THE ASSESSMENT ORDER HAD BEEN SET ASIDE BY THE REVISIONAL AUTHORITY , THE ORDER PASSED BY THE PR. CIT COULD NOT BE SUSTAINED AND WAS LIABLE TO BE STRUCK DOWN ON THE SAID COUNT ITSELF. IT WAS FURTHER SUBMITTED BY THE LD. A.R THAT THE PR. CIT HAD EXCEEDED HIS JURISDICTION UNDER SEC. 263 AND ONLY F OR THE PURPOSE OF SUBSTITUTING HIS VIEW AS AGAINST THAT ARRIVED AT BY THE A . O HAD TAKEN RECOURSE TO THE PROCEEDINGS UNDER SEC. 263 OF THE ACT. APART FROM THAT, IT WAS AVERRED BY THE LD. A.R THAT MERELY BECAUSE THE ASSESSMENT ORDER DID NOT CONTAIN AN ELABOR ATE DISCUSSION AS REGARDS THE VERIFICATION S THAT WERE CARRIED OUT BY THE A.O IN RESPECT OF THE SHARE TRANSACTIONS UNDER CONSIDERATION , THE SAME , THUS, WOULD BY NO MEANS JUSTIFY INVOCATION OF THE PROVISIONS OF SEC. 263 OF THE ACT. IN ORDER TO SUPPORT HIS AF ORESAID CONTENTION THE LD. A.R RELIED ON THE JUDGMENT OF THE HONBLE HIGH COURT OF BOMBAY IN THE CASE OF CIT VS. GABRIEL INDIA LTD. (1993) 263 IT R 108 (BOM). FURTHER, RELYING ON THE ORDER OF THE ITAT, MUMBAI BENCHES A, MUMBAI IN AMBUJA CEMENTS VS. CIT (L TU), MUMBAI, ITA NO. 3568/MUM/2016, DATED 10.11.2017 IT WAS SUBMITTED BY THE LD. A.R THA T A REVISIONAL AUTHORITY REMAINED UNDER A STATUTORY OBLIGATION FOR ALLOWING THE ASSESSEE AN OPPORTUNITY TO EXPLAIN AS TO WHY THE ASSESSMENT MAY NOT BE HELD TO BE ERRONE OUS INSOFAR IT WAS PREJUDICIAL TO THE INTEREST OF THE REVENUE ON THE GROUND ON WHICH THE ORDER WAS SOUGHT TO BE REVISED. IN THE BACKDROP OF HIS AFORESAID CONTENTIONS IT WAS SUBMITTED BY THE LD. A.R THAT THE ORDER PASSED BY THE PR. CIT UNDER SEC. 263 COULD NOT BE SUSTAINED AND WAS LIABLE TO BE VACATED. 10. PER CONTRA, THE LD. D.R RELIED ON THE ORDER PASSED BY THE PR.CIT UNDER SEC. 263, DATED 27.02.2018. IT WAS AVERRED BY THE LD. D.R THAT AS THE PR. CIT ITA NO.5553/MUM/2018 A.Y.2014 - 15 MR. BANSILAL I. JAIN VS. PR. CIT - 28 8 HAD SOUGHT TO REVISE THE ORDER PASSED BY THE A.O UNDER S EC. 143(3), DATED 30.06.2016 ON MULTIPLE GROUNDS, THEREFORE, NO INFIRMITY DID EMERGE FROM THE SET TING ASIDE OF THE ASSESSMENT FRAMED BY THE A.O ON THE BASIS OF ONE OF THE AFORESAID ISSUE S . AS REGARDS THE OBSERVATIONS RECORDED BY THE PR. CIT IN RESPECT OF THE VOLUNTARY DISCLOSURE OF INCOME I.E LTCG BY THE ASSESSEE IN A.Y. 2013 - 14, IT WAS SUBMITTED BY THE LD. D.R THAT THE PR.CIT BY REFERRING TO THE PAST CONDUCT OF THE ASSESSEE HAD ONLY TRIED TO SUPPLEMENT HIS CONVICTION THAT CONSIDERING THE SAME THE A . O OUGH T TO HAVE BEEN MORE VIGILANT WHILE VERIFYING THE AUTHENTICITY OF THE ASSESSEES CLAIM FOR EXEMPTION RAISED UNDER SEC. 10(38) DURING THE YEAR UNDER CONSIDERATION. ADVERTING TO THE NOTICE ISSUED BY THE A.O UNDER SEC. 14 2 ( 1 ), DATED 11.04.2016, IT WAS SUBMITTED BY THE LD. D.R THAT NO QUERY AS REGARDS THE AFORESAID SHARE TRANSACTIONS WAS EVER RAISED BY THE A.O . IT WAS STATED BY THE LD. D.R THAT THOUGH THE ASSESSEE IS STATED TO HAVE FILE D CERTAIN DOCUMENTS AS REGARDS THE AFORES AID SHARE TRANSACTIONS, HOWEVER, THE A . O HAD AT NO STAGE DURING THE COURSE OF THE ASSESSMENT PROCEEDINGS CARRIED OUT ANY VERIFICATION AS REGARDS THE GENUINENESS AND CORRECTNESS OF SUCH TRANSACTIONS. ON THE BASIS OF THE AFORESAID CONTENTIONS IT WAS AVERRED BY THE LD. D.R THAT NO INFIRMITY DID EMERGE FROM THE ORDER PASSED BY THE PR.CIT UNDER SEC.263 OF THE ACT. 11. WE HAVE HEARD THE AUTHORIZED REPRESENTATIVES FOR BOTH THE PARTIES, PERUSED THE ORDERS OF THE LOWER AUTHORITIES AND THE MATERIAL AVAILABLE ON RECOR D AS WELL AS THE JUDICIAL PRONOUNCEMENTS PRESSED INTO SERVICE BY THE COUNSEL FOR THE ASSESSEE APPELLANT . AS IS DISCERNIBLE FROM THE RECORDS THE ASSESSEE HAD CLAIMED TO HAVE PURCHASED 5000 SHARES OF M/S RAVINAY TRADING CORPN. LTD. (NYSSACORP) ON 07.08.2012 FOR RS.9,03,759.35, WHICH THEREAFTER ARE STATED TO HAVE BEEN SOLD AFTER A TIME GAP OF ONE YEAR ON DIFFERENT DATES I.E 30.10.2013 TO 19.12.2013 WITH A RESULTANT PROFIT OF RS.59,48,750/ - . LTCG ARISING ON THE SALE OF THE AFORESAID SHARES WAS CLAIMED BY THE AS SESSEE IN HIS RETURN OF INCOME AS EXEMPT U/S 10(38) OF THE ACT . ON A PERUSAL OF THE RECORDS, WE FIND , THAT THE A . O IN THE COURSE OF THE ASSESSMENT PROCEEDINGS HAD NEITHER QUERIED THE ASSESSEE AS RE GARDS THE AFORESAID SHARE ITA NO.5553/MUM/2018 A.Y.2014 - 15 MR. BANSILAL I. JAIN VS. PR. CIT - 28 9 TRANSACTIONS NOR CARRIED OUT ANY VERIFICATION S PERTAINING TO THE SAME ON HIS OWN. IN FACT, WE FIND THAT THOUGH THE ASSESSEE IN REPLY TO THE NOTICE ISSUED UNDER SEC. 142(1), DATED 11.04.2016 HAD IN PURSUANCE TO A QUERY RAISED BY THE A.O AS REGARDS THE ADDITIONS IN HIS CAPITAL ACCOUNT FILED THE CONTRACT NOTES AND DEMAT STATEMENTS ALONG WITH THE COPIES OF HIS BANK STATEMENTS BUT THE A.O HAD NOT THOUGHT IT APT TO VERIFY THE GENUINENESS AND CORRECTNESS OF THE SAID TRANSACTIONS ON THE BASIS OF WHICH LTCG OF RS. 58,56,466/ - WAS CLAIMED AS E XEMPT U/S 10(38) OF THE ACT. NEITHER IS THERE ANYTHING AVAILABLE ON RECORD NOR ANY MATERIAL HAS BEEN PLACED BEFORE US WHICH WOULD REVEAL THAT THE A.O HAD CARRIED OUT ANY VERIFICATION AS REGARDS THE GENUINENESS/CORRECTNESS OF THE ASSESSEES CLAIM FOR EXEMPT ION OF RS. 58,56,466/ - UNDER SEC. 10(38) OF THE ACT . AS REGARDS THE OBSERVATION OF THE PR. CIT THAT THE ASSESSEE HAD VOLUNTARILY DISCLOSED A SIMILARLY PLACED LTCG OF RS. 40,67,350/ - IN THE IMMEDIATELY PRECEDING YEAR I.E A.Y.2013 - 14 AND PAID TAX ES ON THE SA ME, WE CONCUR WITH THE CONTENTION OF THE LD. D.R THAT BY REFERRING TO THE SAID TRANSACTION THE PR. CIT HAD ONLY TRIED TO FORTIFY HIS VIEW THAT CONSIDERING THE PAST CONDUCT OF THE ASSESSEE THE A.O OUGHT TO HAVE CAREFUL LY VERIF IED THE GENUINENESS OF THE ASSESSEES CLAIM FOR EXEMPTION OF LTCG ON SALE OF SHARES U/S 10(38) AS WAS RAISED DURING THE YEAR UNDER CONSIDERATION. WE ARE NO T AT ALL IMPRESSED BY THE CLAIM OF THE LD. A.R THAT THOUGH THE PR. CIT VIDE HIS SCN, DATED 12.09.2017 HAD SOUGHT TO REVISE THE ASSESSMENT ORDER IN CONTEXT OF THE LTCG OF RS. 58,56,466/ - PERTAINING TO PURCHASE/SALE OF SHARES OF M/S RAVINAY TRADING CORPN. LTD. (NYSSACORP) THAT WAS CLAIMED BY THE ASSESSEE AS EXEMPT UNDER SEC. 10(38) , BUT THE N, CONSIDERING THE FA CT THAT THE ASSESSEE HAD VOLUNTARILY DISCLOSED LTCG OF RS.40,67,350/ - IN A.Y. 2013 - 14 HE HAD DIRECTED THE A.O TO CONDUCT PROPER INQUIRIES, INVESTIGATIONS AND EXAMINATION. AS OBSERVED BY US HEREINA B OVE, THE REFERENCE BY THE PR. CIT TO THE VOLUNTAR Y DISCLOS U RE OF LTCG OF RS.40,67,350/ - ON SALE OF SHARES AND PAYMENT OF TAXES ON THE SAME IN A.Y. 2013 - 14 WAS ONLY IN ORDER TO SUPPORT HIS CONVICTION THAT CONSIDERING THE PAST CONDUCT OF THE ASSESSEE THE A.O OUGHT TO HAVE BEEN MORE CAREFUL AND SHOULD HAVE THOROUGHLY VERIFIED THE GENUINENESS OF THE ITA NO.5553/MUM/2018 A.Y.2014 - 15 MR. BANSILAL I. JAIN VS. PR. CIT - 28 10 SHARE TRANSACTIONS AND THE RESULTANT CLAIM FOR EXEMPTION OF LTCG RAISED BY THE ASSESSEE U/S 10(38) DURING THE YEAR IN QUESTION. 12. ON A PERUSAL OF THE ORDERS OF THE LOWER AUTHORITIES, WE FIND , THAT AS THE A . O HAD FAILED TO VERIFY THE GENUINENESS AND CORRECTNESS OF THE AFORESAID SHARE TRANSACTIONS AND HAD RATHER SUMMARILY ACCEPTED THE ASSESSEES CLAIM FOR EXEMPTION OF LTCG OF RS.58,56,466/ - UNDER SEC.10(38), THEREFORE, THE PR. CIT REMAINING WELL WITHIN THE REALM OF HIS JUR ISDICTION AS CONTEMPLATED IN THE EXPLANATION 2(A) TO SEC. 263 OF THE ACT HAD RIGHTLY SET ASIDE THE ASSESSMENT ORDER WITH A DIRECTION TO THE A.O TO FRAME THE SAME AFRESH AFTER AFFORDING AN OPPORTUNITY OF BEING HEARD TO THE ASSESSEE . AT THIS STAGE , WE MA Y HEREIN OBSERVE THAT THE PR.CI T WH I LE DIRECTING AS HEREINABOVE, HAD HOWEVER, INADVERTENTLY DIRECTED THE A.O TO DISALLOW THE ASSESSEES CLAIM OF EXEMPTION OF LTCG OF RS.58,56,466/ - UNDER SEC. 10(38) OF THE ACT. AS THE AFORESAID DIRECTION OF THE PR. CIT CLE ARLY MILITATES AGAINST HIS DIRECTION TO THE A.O TO PASS A FRESH ASSESSMENT ORDER IN ACCORDANCE WITH LAW AFTER AFFORDING AN OPPORTUNITY OF BEING HEARD TO THE ASSESSEE, THEREFORE, TO THE SAID EXTENT THE SAME CANNOT BE SUSTAINED AND IS EXPUNGED FROM THE IMPUGNED ORDER . 13. IN THE BACKDROP OF OUR AFORESAID OBSERVATIONS WE HEREIN UPHOLD THE ORDER PASSED BY THE PR.CIT UNDER SEC. 263, DATED 27.02.2018, THOUGH SUBJECT TO THE MODIFICATION STATED HEREINABOVE . 14. RESULTANTLY, THE APPEAL FILED BY THE ASSESSEE I S PARTLY ALLOWED IN TERMS OF OUR AFORESAID OBSERVATION . ORDER PR ONOUNCED IN THE OPEN COURT ON 04 . 01 .202 1 SD/ - SD/ - M. BALAGANESH RAVISH SOOD ( ACCOUNTANT MEMBER ) ( JUDICIAL MEMBER) MUMBAI, DATE: 04 . 01 .202 1 PS: ROHIT ITA NO.5553/MUM/2018 A.Y.2014 - 15 MR. BANSILAL I. JAIN VS. PR. CIT - 28 11 COPY OF THE ORDER FORWARDED TO : 1. ASSESSEE 2. RESPONDENT 3. THE CONCERNED CIT(A) 4. THE CONCERNED CIT 5. DR B BENCH, ITAT, MUMBAI 6. GUARD FILE BY ORDER, DY./ASST. REGISTRAR ITAT, MUMBAI