TARUNA KATARIA, MUMBAI V. ITO 19(2)(2), MUMBAI

ITA 584/MUM/2013

AI Insights

The case revolves around the appellant, Mrs. Taruna Kataria, who contested the addition of Rs. 16,60,689 to her income as unexplained investment, which was derived from the sale of shares of Talent Infoways Ltd. The Income Tax Officer (ITO) had treated this amount as unexplained cash credit under section 68 of the Income Tax Act, 1961, and the Commissioner of Income Tax (Appeals) upheld this decision. The Tribunal examined various evidences, including the appellant's submissions and the statements of Mukesh M. Choksi, a key figure in the alleged accommodation entry scheme. The Tribunal concluded that the shares were not held for the required period and the transactions lacked genuineness, leading to the dismissal of the appeal.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 123448 (ITAT-MUMBAI)
• Duration Of Justice: 10 year(s) 7 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-08-2023
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: E
• Next Hearing Date: 19-06-2023
• Assessment Year: 2005-2006
• Appeal Filed On: 20-01-2013
• Other Referred Cases: CIT vs. Lavanya Land Pvt. Ltd - 297 CTR 0204 (Bom), Baijnath vs. ACIT, Ganeshmull Biliay Singh Baid HUF vs. DCIY No.544/Kol/13, Malti Ghanshambhai Patodia vs. ITO 3400/Ahd/2015, Pratik Suryakant Shah vs. ITO - [2017] 77 taxmann.com 260 (Ahmedabad Tribunal), Padduchari Jeevan Prashant Vs. ITO No.452/Hyd/2015, Anil Nand Kishore Goyal vs. ACIT 1256/PN/2012, CIT vs. Jamna Devi Agrawal taxmann.com 529 (Bom HC)
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: BHAVESH R. SHAH
• Keywords: Unexplained cash credit; Unexplained investment; Income from undisclosed sources; Document seized; Share purchase agreement; Opportunity of cross examination; Question of law; Accommodation entries; Onus to prove; Documents seized; Reassessment proceedings
• Section: 147; 131; 68; 148; 143(3); 133A; 143(1); 48; 13

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH “E” MUMBAI BEFORE SHRI OM PRAKASH KANT (ACCOUNTANT MEMBER) AND SHRI NARENDER KUMAR CHOUDHRY (JUDICIAL MEMBER) ITA No. 584/MUM/2013 Assessment Year: 2005-06 Mrs. Taruna Kataria, 404, Bule Heaven, Nehru Road, Santacruz (E), Mumbai-400055. Vs. The ITO-19(2)(2), Lalbaug, Mumbai-400012. PAN No. ACGPK 7391 G Appellant Respondent Assessee by : Mr. Bhavesh R. Shah, CA Revenue by : Mr. B.K. Bagchi, Sr. DR Date of Hearing : 20/06/2023 Date of pronouncement : 24/08/2023 ORDER PER OM PRAKASH KANT, AM This appeal by the assessee is directed against order dated 19.10.2012 passed by the Ld. Commissioner of Income-tax (Appeals)-30, Mumbai [in short ‘the Ld. CIT(A)’] for assessment year 2005-06, raising following grounds: 1. a) The learned Commissioner of Income Tax (Appeal) erred in confirming the unexplained investment u/s 68.of The Income Tax Act, 1961 Rs. 16,60,689/- of Long Term Capital Gain. b) The learned Commissioner of Income Tax (Appeal) failed to appreciate that appellant has submitted full details of Long Term Capital Gain Broker Notes, Purchase Bills, etc. c) The learned Commissioner of Income Tax (Appeal) ought to have appreciate that appellant has hold the such shares more than 12 months as required us 10(38) of The Income Tax Act, 196 d) The learned Commissioner of Income Tax (Appeal) erred in not considering the appellant letter dated 06/09/2011 NIL dated & 09/08/2012. g) The learned Commissioner of Income Tax (Appeal) failed to appreciate that appellant has discharged her onus by submitting all details as required by the assessing officer questionnaires dtd f The learned Commissioner of Income Tax (Appeal) e confirming the additions on the basis of statement of Mr. M.M. Choksi director of the Company. 2) The learned Commissioner of Income Tax (Appeal) not considered th copy of the reason recorded & approval obt appellant for verifying the facts, hence assessment proceeding are bad in law. 2. The assessee further modified also reproduced as under: 1. On the facts and in the circumstances of the case and in law, CIT (A) 16,60,689/- presumptions and suspicion alone. 2. The CIT (A) erred in not appreciating various evidences furnished by the assessee, genuineness of which department has not shares as under: b) The learned Commissioner of Income Tax (Appeal) failed to appreciate that appellant has submitted full details of Long Term Capital Gain i.e. Sales Bills, Demat Statements, Broker Notes, Purchase Bills, etc. c) The learned Commissioner of Income Tax (Appeal) ought to have appreciate that appellant has hold the such shares more than 12 months as required us 10(38) of The Income Tax Act, 1961. d) The learned Commissioner of Income Tax (Appeal) erred in not considering the appellant letter dated 06/09/2011 NIL dated & 09/08/2012. g) The learned Commissioner of Income Tax (Appeal) failed to appreciate that appellant has discharged her onus by submitting all details as required by the assessing officer questionnaires dtd 07/07/2011. f The learned Commissioner of Income Tax (Appeal) e confirming the additions on the basis of statement of Mr. Choksi director of the Company. 2) The learned Commissioner of Income Tax (Appeal) not considered the Assessing Officer has not given certified copy of the reason recorded & approval obtained to the appellant for verifying the facts, hence assessment proceeding are bad in law. The assessee further modified its grounds of appeal, also reproduced as under: 1. On the facts and in the circumstances of the case and in law, CIT (A) erred in confirming addition of a sum of Rs. u/S.68 as unexplained credit based on presumptions and suspicion alone. 2. The CIT (A) erred in not appreciating various evidences furnished by the assessee, genuineness of which department has not doubted relating to LTCG on sale of shares as under: - Mrs. Taruna Kataria 2 ITA No. 584/Mum/2013 b) The learned Commissioner of Income Tax (Appeal) failed to appreciate that appellant has submitted full details of i.e. Sales Bills, Demat Statements, c) The learned Commissioner of Income Tax (Appeal) ought to have appreciate that appellant has hold the such shares more than 12 months as required us 10(38) of The Income d) The learned Commissioner of Income Tax (Appeal) erred in not considering the appellant letter dated 06/09/2011 g) The learned Commissioner of Income Tax (Appeal) failed to appreciate that appellant has discharged her onus by submitting all details as required by the assessing officer f The learned Commissioner of Income Tax (Appeal) erred & confirming the additions on the basis of statement of Mr. 2) The learned Commissioner of Income Tax (Appeal) not Assessing Officer has not given certified ained to the appellant for verifying the facts, hence assessment of appeal, which are 1. On the facts and in the circumstances of the case and in erred in confirming addition of a sum of Rs. u/S.68 as unexplained credit based on 2. The CIT (A) erred in not appreciating various evidences furnished by the assessee, genuineness of which doubted relating to LTCG on sale of a. Balance Sheet of the assessee for the Assessment Year 2005 were duly recorded and reflected. b. The bills towards purchase of shares of M/s.Goldstar Finvest Pvt. c. Bank statement of the assessee maintained with Indian Overseas Bank reflecting the payment and receipts towards purchase and sale of shares of M/s. Talent Infoways Ltd. d. Copy of share certificates transferred in the name of the assessee. e. Copy Securities Pvt.Ltd, member of Bombay Stock Exchange having SEBI registration number and code No.SBI REGN. No. INB sale of shares of M/s. Talent Infoways Ltd. f. Copy of D maintained with Depository Participant M/s. National Securities Services Ltd showing the shares were held in D-mat form and delivered to the broker in D form. 3. The CIT (A) erred in not appreciating that the above evidences and documents neither found to be false nor fabricated. 4. The CIT (A) erred in not appreciating that he has doubted genuineness of the transactions on the basis of only letter received from Director of Income Tax Investigation Wing. However, save and except to the letter issued by Director of Income Tax Investigation record by the CIT (A) as to how the investigation report concerns the assessee and/or shares sold by the assessee. 5. The CIT (A) erred in not ap shares was made on online platform of the stock exchange, therefore, the assessee did not know the names of the buyers and had no connection and/or relations with any such persons. In such online platform transaction with a. Balance Sheet of the assessee for the Assessment Year 2005-06 wherein investment made in shares were duly recorded and reflected. b. The bills towards purchase of shares of M/s.Goldstar Finvest Pvt. Ltd. c. Bank statement of the assessee maintained with Indian Overseas Bank reflecting the payment and receipts towards purchase and sale of shares of M/s. Talent Infoways Ltd. d. Copy of share certificates transferred in the name of the assessee. e. Copy of contract notes issued by M/. Mahasagar Securities Pvt.Ltd, member of Bombay Stock Exchange having SEBI registration number and code No.SBI REGN. No. INB - 230683331/23- sale of shares of M/s. Talent Infoways Ltd. f. Copy of D-mat statement of the assessee maintained with Depository Participant M/s. National Securities Services Ltd showing the shares were held mat form and delivered to the broker in D 3. The CIT (A) erred in not appreciating that the above evidences and documents furnished by the assessee were neither found to be false nor fabricated. 4. The CIT (A) erred in not appreciating that he has doubted genuineness of the transactions on the basis of only letter received from Director of Income Tax Investigation Wing. er, save and except to the letter issued by Director of Income Tax Investigation - there is nothing brought on record by the CIT (A) as to how the investigation report concerns the assessee and/or shares sold by the assessee. 5. The CIT (A) erred in not appreciating that the sale of shares was made on online platform of the stock exchange, therefore, the assessee did not know the names of the buyers and had no connection and/or relations with any such persons. In such online platform transaction with Mrs. Taruna Kataria 3 ITA No. 584/Mum/2013 a. Balance Sheet of the assessee for the Assessment 06 wherein investment made in shares b. The bills towards purchase of shares of c. Bank statement of the assessee maintained with Indian Overseas Bank reflecting the payment and receipts towards purchase and sale of shares of M/s. d. Copy of share certificates transferred in the name of contract notes issued by M/. Mahasagar Securities Pvt.Ltd, member of Bombay Stock Exchange having SEBI registration number and code -10777 for the assessee maintained with Depository Participant M/s. National Securities Services Ltd showing the shares were held mat form and delivered to the broker in D-mat 3. The CIT (A) erred in not appreciating that the above furnished by the assessee were 4. The CIT (A) erred in not appreciating that he has doubted genuineness of the transactions on the basis of only letter received from Director of Income Tax Investigation Wing. er, save and except to the letter issued by Director of there is nothing brought on record by the CIT (A) as to how the investigation report concerns the assessee and/or shares sold by the assessee. preciating that the sale of shares was made on online platform of the stock exchange, therefore, the assessee did not know the names of the buyers and had no connection and/or relations with any such persons. In such online platform transaction with Stock Exchange, the seller and buyer cannot know the names of each other as well as their respective brokers, who were involved in the trading transaction in the secondary platform. In such a situation it cannot be presumed that there could be any transfer of ca the buyers and sellers to convert the unaccounted money of the beneficiary. 6. The CIT (A) erred in not appreciating Hon'ble Bombay High Court judgement in the case of CIT vs. Lavanya Land Pvt.Ltd - 297 CTR 0204 (Bom) wherein Hon'ble Bombay High Court held that there was no evidence whatsoever to allege that the money changed hands between the assessee and broker or any other person including the alleged exit provider whatsoever to convert unaccounted money for getting benefit of LTCG as alleged. case, the Hon'ble Bombay High Court at para in the absence of any material to show that huge cash was transferred from one side to another, addition cannot be sustained, Similar view was i. Baijnath (Agra Third Member) ii. Ganeshmull Biliay Singh Baid HUF vs. DCIY No.544/Kol/13 dated 4.12.2015 (Kolkata Tribunal) iii. Malti Ghanshambhai Patodia vs. ITO 3400/Ahd/2015 (Ahmedabad Tribunal) iv. Pratik Suryakant taxmann.com 260 (Ahmedabad Tribunal) v. Padduchari Jeevan Prashant Vs. ITO No.452/Hyd/2015 (Hyderabad Tribunal) vi. Anil Nand Kishore Goyal vs. ACIT 1256/PN/2012 (Pune Tribunal) vii. CIT vs. Jamna Devi Agrawal taxmann.com 529 (Bom HC) 7. The CIT (A) erred in not appreciating the entire case of revenue is based upon the presumption that the assessee has ploughed back his own unaccounted money in the form of bogus LTCG which needs to be corroborated by some evidence to establish a link that the assessee had brought back his unaccounted income in the form of LTCG. Exchange, the seller and buyer cannot know the names of each other as well as their respective brokers, who were involved in the trading transaction in the secondary platform. In such a situation it cannot be presumed that there could be any transfer of cash between the buyers and sellers to convert the unaccounted money of the beneficiary. 6. The CIT (A) erred in not appreciating Hon'ble Bombay High Court judgement in the case of CIT vs. Lavanya Land 297 CTR 0204 (Bom) wherein Hon'ble Bombay Court held that there was no evidence whatsoever to allege that the money changed hands between the assessee and broker or any other person including the alleged exit provider whatsoever to convert unaccounted money for getting benefit of LTCG as alleged. In the said case, the Hon'ble Bombay High Court at para - 21 held that in the absence of any material to show that huge cash was transferred from one side to another, addition cannot be Similar view was taken in the following cases. Baijnath Agarwallla vs. ACIT [2010] 40 SOT 475 (Agra Third Member) Ganeshmull Biliay Singh Baid HUF vs. DCIY No.544/Kol/13 dated 4.12.2015 (Kolkata Tribunal) Malti Ghanshambhai Patodia vs. ITO - 3400/Ahd/2015 (Ahmedabad Tribunal) Pratik Suryakant Shah vs. ITO - [2017] 77 taxmann.com 260 (Ahmedabad Tribunal) Padduchari Jeevan Prashant Vs. ITO No.452/Hyd/2015 (Hyderabad Tribunal) Anil Nand Kishore Goyal vs. ACIT - 1256/PN/2012 (Pune Tribunal) CIT vs. Jamna Devi Agrawal - [2012] 20 mann.com 529 (Bom HC) 7. The CIT (A) erred in not appreciating the entire case of revenue is based upon the presumption that the assessee has ploughed back his own unaccounted money in the form of bogus LTCG which needs to be corroborated by some to establish a link that the assessee had brought back his unaccounted income in the form of LTCG. Mrs. Taruna Kataria 4 ITA No. 584/Mum/2013 Exchange, the seller and buyer cannot know the names of each other as well as their respective brokers, who were involved in the trading transaction in the secondary platform. In such a situation it cannot be sh between the buyers and sellers to convert the unaccounted money of 6. The CIT (A) erred in not appreciating Hon'ble Bombay High Court judgement in the case of CIT vs. Lavanya Land 297 CTR 0204 (Bom) wherein Hon'ble Bombay Court held that there was no evidence whatsoever to allege that the money changed hands between the assessee and broker or any other person including the alleged exit provider whatsoever to convert unaccounted In the said 21 held that in the absence of any material to show that huge cash was transferred from one side to another, addition cannot be Agarwallla vs. ACIT [2010] 40 SOT 475 Ganeshmull Biliay Singh Baid HUF vs. DCIY - IT No.544/Kol/13 dated 4.12.2015 (Kolkata Tribunal) - ITA No. [2017] 77 Padduchari Jeevan Prashant Vs. ITO - ITA ITA Nos. [2012] 20 7. The CIT (A) erred in not appreciating the entire case of revenue is based upon the presumption that the assessee has ploughed back his own unaccounted money in the form of bogus LTCG which needs to be corroborated by some to establish a link that the assessee had brought back his unaccounted income in the form of LTCG. 8. The CIT (A) erred in not appreciating that neither the statements relied on by the CIT (A) were provided to the assessee nor any cross examination was all repeated requests made by the assessee to prove veracity of the statements. Therefore, no adverse inferences could be drawn on the basis of untested statements without allowing an opportunity of cross examination. Assessee relies on the following judgements in support of the said ground. i. Andman Timber Industries vs. CCE taxmann.com 3 (SC). ii. ITO vs. Ashok Kumar Bansal (Agra ITAT) iii. ACIT vs. Amita Agarwal & Others of 2011 (Kol ITAT) iv. ITO vs. Bijay (Kol ITAT) v. Ganeshmull Bijay Singh Baid HUF VS. DCIT Nos.544/Kol/2013 (Kolkata ITAT) vi. Rita Devi & Others vs. DCIT 26/Kol/2p11 (Kol ITAT) vii. Mali Ghanshyambhai Patadia vs. ITO 3400/Ahd/2015 viii. Pratik Suryakant Shah vs. ITO taxmann.com 260 (Ahmedabad ITAT) ix. Sunita Jain vs. ITO (Ahmedabad ITAT) x. Atul Kumar Khandelwal vs. DCIT No.874/Del/2016 (Delhi ITAT) xi. Farah Marker vs. ITO (Mumbai ITAT) 3. Briefly stated, facts of the case are that the assessee filed return of income on 30.10.2005 declaring total income at Rs.1,62,370/-. The return of income was processed u/s 143(1) of the Income-tax Act, 1961 (in short ‘the Act receipt of information from Investigation Wing of the Income Department that assessee obtained accommodation entries from the companies operated by Shri Mukesh M. Chokshi 8. The CIT (A) erred in not appreciating that neither the statements relied on by the CIT (A) were provided to the assessee nor any cross examination was allowed despite repeated requests made by the assessee to prove veracity of the statements. Therefore, no adverse inferences could be drawn on the basis of untested statements without allowing an opportunity of cross examination. Assessee relies on the ing judgements in support of the said ground. Andman Timber Industries vs. CCE - [1205] 62. taxmann.com 3 (SC). ITO vs. Ashok Kumar Bansal - ITA No.289/Agr/2009 (Agra ITAT) ACIT vs. Amita Agarwal & Others - ITA No.247/(Kol) of 2011 (Kol ITAT) ITO vs. Bijaya Ganguly - IT Nos.624 & 625/Kol/2011 (Kol ITAT) Ganeshmull Bijay Singh Baid HUF VS. DCIT Nos.544/Kol/2013 (Kolkata ITAT) Rita Devi & Others vs. DCIT - IT(SS) A Nos. 22 26/Kol/2p11 (Kol ITAT) Mali Ghanshyambhai Patadia vs. ITO - 3400/Ahd/2015 (Ahmedabad ITAT) Pratik Suryakant Shah vs. ITO - [2017] 77 taxmann.com 260 (Ahmedabad ITAT) Sunita Jain vs. ITO - ITA No.201 & 502/Ahd/2016 (Ahmedabad ITAT) Atul Kumar Khandelwal vs. DCIT No.874/Del/2016 (Delhi ITAT) Farah Marker vs. ITO - ITA No. 3801/Mum/2011 (Mumbai ITAT) Briefly stated, facts of the case are that the assessee filed return of income on 30.10.2005 declaring total income at . The return of income was processed u/s 143(1) of tax Act, 1961 (in short ‘the Act’). Subsequently, on receipt of information from Investigation Wing of the Income Department that assessee obtained accommodation entries from the companies operated by Shri Mukesh M. Chokshi Mrs. Taruna Kataria 5 ITA No. 584/Mum/2013 8. The CIT (A) erred in not appreciating that neither the statements relied on by the CIT (A) were provided to the owed despite repeated requests made by the assessee to prove veracity of the statements. Therefore, no adverse inferences could be drawn on the basis of untested statements without allowing an opportunity of cross examination. Assessee relies on the ing judgements in support of the said ground. [1205] 62. ITA No.289/Agr/2009 ITA No.247/(Kol) IT Nos.624 & 625/Kol/2011 Ganeshmull Bijay Singh Baid HUF VS. DCIT – ITA IT(SS) A Nos. 22- - ITA No. [2017] 77 ITA No.201 & 502/Ahd/2016 Atul Kumar Khandelwal vs. DCIT - ITA 801/Mum/2011 Briefly stated, facts of the case are that the assessee filed return of income on 30.10.2005 declaring total income at . The return of income was processed u/s 143(1) of ’). Subsequently, on receipt of information from Investigation Wing of the Income-tax Department that assessee obtained accommodation entries from the companies operated by Shri Mukesh M. Chokshi , who were involved in providing profit/loss through various bogus companies created. The Assessing Officer recorded the reasons to believe escaped assessment and the Act on 25.03.2011. In response to the notice u/s 148 of t the assessee intimated to treat the return of income filed originally as filed in response to notice u/s 148 of the Act. Subsequently, statutory notices along with questionnaire were issued and the assessment u/s 147 r.w.s. 143(3) of the Act was co 19/12/2011. The Assessing Officer observed gain shown by the assessee on transfer of shares of the script Talent Infoways P. Ltd. of the Act ,but he rejected the claim of long term ca treated the consideration of Rs. Talent Infoways P. Ltd. as unexplained cash credit u/s 68 of the Act. On further appeal, the Ld. CIT(A) vide impugned order dated 19.10.2012 , also upheld the addition Officer. The Ld. CIT(A) also upheld that assessee was not entitled for exemption of the long term capital gain u/s 10(38) of the Act as shares were not held for more than 12 months in the account’. 3.1 Before us, the assessee file to 47 and copy of the decisions relied upon. involved in providing accommodation entries of profit/loss through various bogus companies created. The recorded the reasons to believe escaped assessment and accordingly, he issued notice u/s 148 of the Act on 25.03.2011. In response to the notice u/s 148 of t the assessee intimated to treat the return of income filed originally as filed in response to notice u/s 148 of the Act. Subsequently, statutory notices along with questionnaire were issued and the assessment u/s 147 r.w.s. 143(3) of the Act was co 19/12/2011. The Assessing Officer observed the long term capital gain shown by the assessee on transfer of shares of the script Talent Infoways P. Ltd., which was claimed as exempt u/s 10(38) rejected the claim of long term ca the consideration of Rs.16,60,689/- on transfer of shares of Talent Infoways P. Ltd. as unexplained cash credit u/s 68 of the Act. On further appeal, the Ld. CIT(A) vide impugned order dated also upheld the addition made by the Assessing he Ld. CIT(A) also upheld that assessee was not entitled for exemption of the long term capital gain u/s 10(38) of the Act as shares were not held for more than 12 months in the Before us, the assessee filed a Paper Book containing pages 1 to 47 and copy of the decisions relied upon. Mrs. Taruna Kataria 6 ITA No. 584/Mum/2013 accommodation entries of speculation profit/loss through various bogus companies created. The recorded the reasons to believe that income issued notice u/s 148 of the Act on 25.03.2011. In response to the notice u/s 148 of the Act, the assessee intimated to treat the return of income filed originally as filed in response to notice u/s 148 of the Act. Subsequently, statutory notices along with questionnaire were issued and the assessment u/s 147 r.w.s. 143(3) of the Act was completed on the long term capital gain shown by the assessee on transfer of shares of the script which was claimed as exempt u/s 10(38) rejected the claim of long term capital gain and on transfer of shares of Talent Infoways P. Ltd. as unexplained cash credit u/s 68 of the Act. On further appeal, the Ld. CIT(A) vide impugned order dated by the Assessing he Ld. CIT(A) also upheld that assessee was not entitled for exemption of the long term capital gain u/s 10(38) of the Act as shares were not held for more than 12 months in the ‘demat d a Paper Book containing pages 1 4. The grounds raised by the assessee before us, are categories. The first category validity of the reassessment the grounds relate to challenge ground No. 2 of the appeal challenging validity of the is concerned, the Ld. Counsel of the assessee submitted that assessee was not interested in pursuing the sa Accordingly, the said ground of appeal of the assessee is dismissed as infructuous. 4.1 All the remaining grounds i revolves around the issue of treating the sale consideration received on sale of shares of Talent credit u/s 68 of the Act. The assessee has also challenged the finding of the lower authorities that mandatory period of 12 months holding for eligibility of benefit gain u/s 10(38) of the Act was not fulfilled by the assessee. 5. Before us, the Ld. Counsel of the assessee that assessee has duly discharged its onus to prove genuineness of the transaction by way (ii) purchase bill, (iii) share certificate, (vi) passbook reflecting the transaction of the sales via letter dated 06.09.2011 and (viii) dated 09.08.2012 ,therefore, provisions of section 68 of the Act The grounds raised by the assessee before us, are first category of the grounds relate of the reassessment proceedings and second category to challenge of addition on merit. As far as ground No. 2 of the appeal challenging validity of the , the Ld. Counsel of the assessee submitted that assessee was not interested in pursuing the sa Accordingly, the said ground of appeal of the assessee is dismissed All the remaining grounds including the modified grounds the issue of treating the sale consideration received on sale of shares of Talent Infoway Pvt. Ltd. as unexplained cash credit u/s 68 of the Act. The assessee has also challenged the finding of the lower authorities that mandatory period of 12 months holding for eligibility of benefit for exemption of long term capital gain u/s 10(38) of the Act was not fulfilled by the assessee. Before us, the Ld. Counsel of the assessee , firstly that assessee has duly discharged its onus to prove genuineness of the transaction by way of filing (i) copy of purchase contract note, (iii) sales contract note, (iv) sales bills, (vi) copy of demat statement and (vii) passbook reflecting the transaction of the sales via letter dated (viii) balance sheet and capital accounts via letter therefore, provisions of section 68 of the Act Mrs. Taruna Kataria 7 ITA No. 584/Mum/2013 The grounds raised by the assessee before us, are of two relate to challenge of cond category of on merit. As far as ground No. 2 of the appeal challenging validity of the reassessment , the Ld. Counsel of the assessee submitted that assessee was not interested in pursuing the said grounds. Accordingly, the said ground of appeal of the assessee is dismissed ncluding the modified grounds the issue of treating the sale consideration received Infoway Pvt. Ltd. as unexplained cash credit u/s 68 of the Act. The assessee has also challenged the finding of the lower authorities that mandatory period of 12 months exemption of long term capital gain u/s 10(38) of the Act was not fulfilled by the assessee. firstly, submitted that assessee has duly discharged its onus to prove genuineness of copy of purchase contract note, sales bills, (v) copy of (vii) copy of bank passbook reflecting the transaction of the sales via letter dated balance sheet and capital accounts via letter therefore, provisions of section 68 of the Act cannot be invoked in the case of the assessee. The Ld. Counsel relied on the following i. CIT v. Orissa Corporati ii. ACIT v. K.K. Traders (2017) 83 taxmann.com 350 (Chennai Trib.) iii. CIT v. M/s S.M. Construction (ITA No. 2471/Mum/2016) iv. CIT v. Bhanwarlal Jain (ITA No. 2997/Mum/2018) 5.1 Secondly, the Ld. Counsel of the assessee submitted th addition in the case of the assessee has been made on the basis of the statement of Shri Mukesh M. Choksi of M/s Mahasagar Securities Pvt. Ltd. ( Ld. Counsel submitted that mere confessional statement by third party would not be sufficient to hold income. The Ld. Counsel in support of contention relied on the following decisions: i. CIT v. Ankit Gupta (2019) ii. Chetan H. Gandhi v. ACIT (2016) iii. CIT v. Shree Sai Computers (2015) 5.2 Thirdly, the Ld. Counsel referred to the various modified grounds raised and submitted that the transaction of the has been carried out seller and buyer didn’t know names of each anonymity of seller and the buyer and in such a situation be presumed that there would be a transfer of cash between the buyers and seller beneficiary. The Ld. Counsel relied on the decision in the case of cannot be invoked in the case of the assessee. The Ld. Counsel relied on the following decisions: CIT v. Orissa Corporation P. Ltd. (1986) 159 ITR 78 (SC) ACIT v. K.K. Traders (2017) 83 taxmann.com 350 (Chennai CIT v. M/s S.M. Construction (ITA No. 2471/Mum/2016) CIT v. Bhanwarlal Jain (ITA No. 2997/Mum/2018) the Ld. Counsel of the assessee submitted th addition in the case of the assessee has been made on the basis of the statement of Shri Mukesh M. Choksi of M/s Mahasagar (now known as Alag Securities Pvt. Ltd. Ld. Counsel submitted that mere confessional statement by third party would not be sufficient to hold that the assessee income. The Ld. Counsel in support of contention relied on the CIT v. Ankit Gupta (2019) Chetan H. Gandhi v. ACIT (2016) CIT v. Shree Sai Computers (2015) he Ld. Counsel referred to the various modified grounds raised and submitted that the transaction of the has been carried out on online platform of stock exchange where seller and buyer didn’t know names of each other seller and the buyer and in such a situation be presumed that there would be a transfer of cash between the buyers and seller for converting unaccounted money of the beneficiary. The Ld. Counsel relied on the decision in the case of Mrs. Taruna Kataria 8 ITA No. 584/Mum/2013 cannot be invoked in the case of the assessee. The Ld. Counsel on P. Ltd. (1986) 159 ITR 78 (SC) ACIT v. K.K. Traders (2017) 83 taxmann.com 350 (Chennai- CIT v. M/s S.M. Construction (ITA No. 2471/Mum/2016) CIT v. Bhanwarlal Jain (ITA No. 2997/Mum/2018) the Ld. Counsel of the assessee submitted that addition in the case of the assessee has been made on the basis of the statement of Shri Mukesh M. Choksi of M/s Mahasagar now known as Alag Securities Pvt. Ltd.) The Ld. Counsel submitted that mere confessional statement by third the assessee has escaped income. The Ld. Counsel in support of contention relied on the he Ld. Counsel referred to the various modified grounds raised and submitted that the transaction of the share sale exchange where other, thus, there is seller and the buyer and in such a situation, it cannot be presumed that there would be a transfer of cash between the unaccounted money of the beneficiary. The Ld. Counsel relied on the decision in the case of CIT vs Lavanya Land Pvt Ltd reported in (Bombay), wherein it is held that in that huge cash transferred cannot be sustained. The Ld. Counsel further submitte lower authorities have presumption that assessee has in the form of bogus long term capital gain but said presumption is not corroborated by any evidence 5.3 Fourthly, the Ld. Counsel submitted that assessee has neither been provided statement relied upon by the Ld. CIT(A) nor any cross-examination made by the assessee to prove the veracity of those statements and therefore, in absence of any opportunity of cross statement to Shri Mukesh M. Choksi relied upon by the Ld. CIT(A) need to be rejected, following the decisions of the Hon’ble Supreme Court in the case of Andaman Timber Industries v. CCF 1205 (62 taxmann.com 3) (SC). 5.4 Fifthly, the Ld. Counsel submitted that finding of the Ld. CIT(A) that assessee held the shares for the period of less tha months as required u/s 10(38 facts and law on the issue. The Ld. Counsel refe Circular No. 768 dated 24.06.1998 clarified (i) determination of the date of the transfer and period of holding of securities held in dematerialized form CIT vs Lavanya Land Pvt Ltd reported in 297 CTR 204 wherein it is held that in absence of the material to show transferred from one side to another cannot be sustained. The Ld. Counsel further submitte authorities have sustained the addition based on the presumption that assessee has ploughed back unaccounted money in the form of bogus long term capital gain but said presumption is corroborated by any evidences. he Ld. Counsel submitted that assessee has neither been provided statement relied upon by the Ld. CIT(A) nor examination has been allowed despite repeated request made by the assessee to prove the veracity of those statements and sence of any opportunity of cross-examination the statement to Shri Mukesh M. Choksi relied upon by the Ld. CIT(A) following the decisions of the Hon’ble Supreme Andaman Timber Industries v. CCF 1205 (62 m 3) (SC). he Ld. Counsel submitted that finding of the Ld. CIT(A) that assessee held the shares for the period of less tha months as required u/s 10(38) of the Act without appreciation of law on the issue. The Ld. Counsel refe Circular No. 768 dated 24.06.1998 and submitted that CBDT has determination of the date of the transfer and period of holding of securities held in dematerialized form Mrs. Taruna Kataria 9 ITA No. 584/Mum/2013 297 CTR 204 absence of the material to show from one side to another, addition cannot be sustained. The Ld. Counsel further submitted that the sustained the addition based on the ack unaccounted money in the form of bogus long term capital gain but said presumption is he Ld. Counsel submitted that assessee has neither been provided statement relied upon by the Ld. CIT(A) nor allowed despite repeated request made by the assessee to prove the veracity of those statements and examination the statement to Shri Mukesh M. Choksi relied upon by the Ld. CIT(A) following the decisions of the Hon’ble Supreme Andaman Timber Industries v. CCF 1205 (62 he Ld. Counsel submitted that finding of the Ld. CIT(A) that assessee held the shares for the period of less than 12 ) of the Act without appreciation of law on the issue. The Ld. Counsel referred to CBDT and submitted that CBDT has determination of the date of the transfer and (ii) the period of holding of securities held in dematerialized form and made it clear that in case of securities conclusively to be taken from the the period of the holding also to be reckoned from the date of the date of the purchase Ld. Counsel in support of his co the ITAT Mumbai in ITA No. 5066/Mum/2009 for assessment year 2006-07 in the case of Shri Jafferali K Rattonsey 6. On the contrary the Ld. Departmental Representative (DR) relied on the order of the lower authorities and submitted that assessee has only filed paper trails of the transactions of purchase and sales of the shares such papers in itself does not prove that the transaction carried out by the assessee was genuine. He referred that those documents itself were defective. He submitted that the has been shown on 24 cash and credit available in account. case of off-market transactions the section 13 of the Securities Contract Regulation Act that for transaction of purchase, it has to b payment for purchase made within 48 hours compliance of said provisions of the securities contract Act and the securities has be later i.e. on 31.05.2003, which is evident from the paper book page in case of securities the “date of the purchase” conclusively to be taken from the broker’s note/contract note and the period of the holding also to be reckoned from the date of the date of the purchase and not for the date of dematerialization. The Ld. Counsel in support of his contention relied upon the decision of ITAT Mumbai in ITA No. 5066/Mum/2009 for assessment 07 in the case of Shri Jafferali K Rattonsey On the contrary the Ld. Departmental Representative (DR) relied on the order of the lower authorities and submitted that assessee has only filed paper trails of the transactions of purchase and sales of the shares of M/s Talent Infoways Pvt. Ltd. and filin such papers in itself does not prove that the transaction carried out by the assessee was genuine. He referred that those documents itself were defective. He submitted that the purchase on 24 th and 28 th April,2003 by the and credit available in account. He further submitted that i market transactions without involving stock exchange, section 13 of the Securities Contract Regulation Act transaction of purchase, it has to be a spot transaction i.e payment for purchase as well as delivery of the shares within 48 hours of the contract. Since, in the case there is no compliance of said provisions of the securities contract Act and the securities has been transferred to the assessee much later i.e. on 31.05.2003, which is evident from the paper book page Mrs. Taruna Kataria 10 ITA No. 584/Mum/2013 of the purchase” is note/contract note and the period of the holding also to be reckoned from the date of the dematerialization. The ntention relied upon the decision of ITAT Mumbai in ITA No. 5066/Mum/2009 for assessment 07 in the case of Shri Jafferali K Rattonsey. On the contrary the Ld. Departmental Representative (DR) relied on the order of the lower authorities and submitted that assessee has only filed paper trails of the transactions of purchase M/s Talent Infoways Pvt. Ltd. and filing of such papers in itself does not prove that the transaction carried out by the assessee was genuine. He referred that those documents purchase of the shares by the assessee in He further submitted that in without involving stock exchange, section 13 of the Securities Contract Regulation Act provided e a spot transaction i.e as well as delivery of the shares has to be in the case there is no compliance of said provisions of the securities contract regulation en transferred to the assessee much later i.e. on 31.05.2003, which is evident from the paper book page 30 and 31, which are letters Infoways Pvt. Ltd. to the assessee The Ld. CIT(A) has purchase as 24.04.2003 and 28.04.2003 but no evidence regarding delivery of the shares within 48 hours was given. The Ld. DR further submitted that on the back side of the share certificate there was no initial documentary evidence i.e. postal receipt or courier receipt to show that when those shares were sent by the assessee to the company for transfer of name of the assessee. Further as how and when certificates to the assessee the share certificate. The Ld. DR further pointed out that quantity of the shares purchases is in the bunch of 2000 shares whereas the share certificates are in the bunch of the 5000 shares and such a split was not possible in those share certificates by the company prior to purchase that in the cases of Mahasagar Securities Pvt. Ltd. the Tribunal has already held that companies of the said group GoldStar finvest ltd ( i.e. the company who has issued purchase and contract note to the assessee) accommodation entry and accordingly considered as the income of those com ITAT has become final either during assessment proceedings or appellate proceedings 30 and 31, which are letters issued by the company M/s Talent Infoways Pvt. Ltd. to the assessee for transfer of share The Ld. CIT(A) has noted that assessee has shown date of the purchase as 24.04.2003 and 28.04.2003 but no evidence regarding delivery of the shares within 48 hours was given. The Ld. DR further submitted that on the back side of the share certificate was no initial of the assessee. Further there is no documentary evidence i.e. postal receipt or courier receipt to show those shares were sent by the assessee to the company for transfer of name of the assessee. Further, there is no evidence and when the company has returned to the assessee after change of the name on back side of the share certificate. The Ld. DR further pointed out that quantity of the shares purchases is in the bunch of 2000 shares whereas the are in the bunch of the 5000 shares and such a possible in those share certificates unless prior to purchase. The Ld. DR further submitted that in the cases of Mahasagar Securities Pvt. Ltd. the Tribunal has already held that companies of the said group invest ltd ( i.e. the company who has issued purchase and contract note to the assessee) were engaged in providing accommodation entry and accordingly 0.15% of the total entries considered as the income of those companies. The said finding of me final. Further, the Ld. Counsel submitted that assessment proceedings or appellate proceedings Mrs. Taruna Kataria 11 ITA No. 584/Mum/2013 by the company M/s Talent of share certificates. noted that assessee has shown date of the purchase as 24.04.2003 and 28.04.2003 but no evidence regarding delivery of the shares within 48 hours was given. The Ld. DR further submitted that on the back side of the share certificate(s), of the assessee. Further there is no documentary evidence i.e. postal receipt or courier receipt to show those shares were sent by the assessee to the company there is no evidence returned those shares after change of the name on back side of the share certificate. The Ld. DR further pointed out that quantity of the shares purchases is in the bunch of 2000 shares whereas the are in the bunch of the 5000 shares and such a unless permitted . The Ld. DR further submitted that in the cases of Mahasagar Securities Pvt. Ltd. the Tribunal has already held that companies of the said group including the invest ltd ( i.e. the company who has issued purchase were engaged in providing 0.15% of the total entries has panies. The said finding of the Ld. Counsel submitted that assessment proceedings or appellate proceedings, at any stage the assessee did not ask for cross Mukesh M. Choksi, such request was made however no documentary evidence in support of the claim lower authorities and therefore, such contention of the assessee are liable to be discarded. 7. We have heard rival submission of the parties on t dispute and perused the relevant material on record. We find that the Ld. CIT(A) after considering the submission of the assessee and appreciation of the assessment order assessee observing as under: “2.8 I have order and the submissions made on behalf of the appellant. In this case, the appellant has entered into share transactions through Mukesh Maneklal Choksi one of the hawala operators for sale and purchase of shares. Sh in his statement recorded u/s. 131 of the I.T. Act, 1961 before DDIT(Inv), Unit 2009 of having issued cheques / DDs for accommodation entries to various beneficiaries against the receipt of cash and third part for giving cheques for accommodation entries to the beneficiaries. It was the finding of the Investigation Wing that Shri Mukesh Maneklal tools of his broking concerns viz M/s. Mahasagar Securities Pvt. Ltd. and its related group companies was involved in fraudulent billing activities and in the business of providing bogus speculation profit/loss, short term/long term capital gains/loss, commodities profit/loss on commodity trading througl, MCX and has been continuing thi business for many years. Shri Mukesh Mancklal any stage the assessee did not ask for cross-examination of Shri though the Ld. Counsel has submitted that t was made however no documentary evidence in support of the claim that such request was ever made before the lower authorities and therefore, such contention of the assessee are liable to be discarded. We have heard rival submission of the parties on t dispute and perused the relevant material on record. We find that the Ld. CIT(A) after considering the submission of the assessee and appreciation of the assessment order, rejected the contention of the assessee observing as under: carefully gone through the assessment order and the submissions made on behalf of the appellant. In this case, the appellant has entered into share transactions through Mukesh Maneklal Choksi one of the hawala operators for sale and purchase of shares. Shri M.M. Choksi had admitted in his statement recorded u/s. 131 of the I.T. Act, 1961 before DDIT(Inv), Unit-6, Mumbai on 11-12 2009 of having issued cheques / DDs for accommodation entries to various beneficiaries against the receipt of cash and third party cheques for giving cheques for accommodation entries to the beneficiaries. It was the finding of the Investigation Wing that Shri Mukesh Maneklal Choksi with the tools of his broking concerns viz M/s. Mahasagar Securities Pvt. Ltd. and its related group of 34 odd companies was involved in fraudulent billing activities and in the business of providing bogus speculation profit/loss, short term/long term capital gains/loss, commodities profit/loss on commodity trading througl, MCX and has been continuing thi business for many years. Shri Mukesh Mancklal Mrs. Taruna Kataria 12 ITA No. 584/Mum/2013 examination of Shri though the Ld. Counsel has submitted that t was made however no documentary evidence in made before the lower authorities and therefore, such contention of the assessee are We have heard rival submission of the parties on the issue in dispute and perused the relevant material on record. We find that the Ld. CIT(A) after considering the submission of the assessee and rejected the contention of the carefully gone through the assessment order and the submissions made on behalf of the appellant. In this case, the appellant has entered into share transactions through Mukesh Maneklal Choksi one of the hawala operators for sale and ri M.M. Choksi had admitted in his statement recorded u/s. 131 of the I.T. Act, 12- 2009 of having issued cheques / DDs for accommodation entries to various beneficiaries y cheques for giving cheques for accommodation entries to the beneficiaries. It was the finding of the Investigation with the tools of his broking concerns viz M/s. Mahasagar of 34 odd companies was involved in fraudulent billing activities and in the business of providing bogus speculation profit/loss, short term/long term capital gains/loss, commodities profit/loss on commodity trading througl, MCX and has been continuing this business for many years. Shri Mukesh Mancklal Choksi had admitted before the DDIT (Inv.) Unit Mumbai that one of the beneficiaries for accommodation entries is Mrs. Taruna A. The appellant has earned LTCG by indulging in trading of shares of have not been held in the Demat account for a period of 12 months or more, The transaction of purchase of these shares have not been done through stock exchange. Shri Mukesh Choksi, the Director of Mahasagar Securities Pvt. categorically admitted that M/s. Mahasagar Securities Put. Ltd was engaged in the business of providing accommodation entries in the nature of bogus |LTCG.The ITAT vide its order dated 29 2008 in its No. in the case of M/S. has accepted this claim and declared the company as an entry. provider and ordered that its income should be computed @, 0. 15% of total entries provided by this company. Further, as per the information made avai Wing, the appellant has indulged herself in bogus share transactions of Talent Infoways Ltd. In view of the above, the A.. treated the LTCG earned from share transactions of Talent Infoways Ltd. to the tune of Rs. 16,60,689 / accordingly treated the sum of Rs. 16,60,689 / unexplained investment of the appellant within the meaning of section 68 of the I.T. Act and added the same to the total income of the appellant. The A.O. also mentioned in the as provisions of Section 292(c) of the I.T. the Act with retrospective effect from 01 casts onus upon assessee to explain all the material gathered and seized in course of search action Wis. 132 or survey u/s. 2.9 In view of the above discussion, I find that the A.O. is quite justified in holding that the appellant has entered into bogus transactions of purchase and sale of shares and therefore, has rightly made addition of Rs. 16,60,689/ investment W/s. 68 of the I.T. Act. As regards to the Choksi had admitted before the DDIT (Inv.) Unit Mumbai that one of the beneficiaries for accommodation entries is Mrs. Taruna A. Kataria. The appellant has earned LTCG by indulging in trading of shares of Talent Infoways Ltd. The shares have not been held in the Demat account for a period of 12 months or more, The transaction of purchase of these shares have not been done through stock exchange. Shri Mukesh Choksi, the Director of Mahasagar Securities Pvt. Ltd has categorically admitted that M/s. Mahasagar Securities Put. Ltd was engaged in the business of providing accommodation entries in the nature of bogus |LTCG.The ITAT vide its order dated 29-08 2008 in its No. 462/Mum/2005 for the A.Y. 2002- case of M/S. Mahasagar Securities Pvt. Ltd. has accepted this claim and declared the company as an entry. provider and ordered that its income should be computed @, 0. 15% of total entries provided by this company. Further, as per the information made available by the Investigation Wing, the appellant has indulged herself in bogus share transactions of Talent Infoways Ltd. In view of the above, the A.. treated the LTCG earned from share transactions of Talent Infoways Ltd. to the tune of Rs. 16,60,689 / - as bogus transactions and accordingly treated the sum of Rs. 16,60,689 / - unexplained investment of the appellant within the meaning of section 68 of the I.T. Act and added the same to the total income of the appellant. The A.O. also mentioned in the assessment order that the provisions of Section 292(c) of the I.T. Act inserted to the Act with retrospective effect from 01-04-1970 onus upon assessee to explain all the material gathered and seized in course of search action Wis. 132 or survey u/s. 133A of the I.T. Act. 2.9 In view of the above discussion, I find that the A.O. is quite justified in holding that the appellant has entered into bogus transactions of purchase and sale of shares and therefore, has rightly made addition of Rs. 16,60,689/- being unexplained investment W/s. 68 of the I.T. Act. As regards to the Mrs. Taruna Kataria 13 ITA No. 584/Mum/2013 Choksi had admitted before the DDIT (Inv.) Unit-1, Mumbai that one of the beneficiaries for Kataria. The appellant has earned LTCG by indulging in Talent Infoways Ltd. The shares have not been held in the Demat account for a period of 12 months or more, The transaction of- purchase of these shares have not been done through stock exchange. Shri Mukesh Choksi, the Ltd has categorically admitted that M/s. Mahasagar Securities Put. Ltd was engaged in the business of providing accommodation entries in the nature of 08- -03 Mahasagar Securities Pvt. Ltd. has accepted this claim and declared the company as an entry. provider and ordered that its income should be computed @, 0. 15% of total entries provided by this company. Further, as per the lable by the Investigation Wing, the appellant has indulged herself in bogus share transactions of Talent Infoways Ltd. In view of the above, the A.. treated the LTCG earned from share transactions of Talent Infoways Ltd. to the s bogus transactions and as unexplained investment of the appellant within the meaning of section 68 of the I.T. Act and added the same to the total income of the appellant. The A.O. sessment order that the inserted to 1970 onus upon assessee to explain all the material gathered and seized in course of search action Wis. 2.9 In view of the above discussion, I find that the A.O. is quite justified in holding that the appellant has entered into bogus transactions of purchase and sale of shares and therefore, has rightly made eing unexplained investment W/s. 68 of the I.T. Act. As regards to the case laws cited by the Ld. AR, the same were found to be distinguishable on facts. Further, the A.O. has made the addition on account of unexplained investment and therefore, the plea o that no addition can be made u/s. 68 doesn't hold much of ground. The same is reiected. The addition so made by the A.O. is accordingly confirmed. The grounds of appeal are dismissed. 7.1 Before us, the assessee has referred to copy of pur contract notes (PB- Sales contract notes 13, 14, 17 and 18) copy of share certificates (PB 21 to 29) copy of demat statement (PB 32), copy of bank passbook (PB 39, 40). The assessee has also filed copy of receipt issued by Goldstar Finvest Pvt. Ltd. i.e. CC/2003/207/87 dated 24.04.2003 and Rs.17,498/ No.CC/2003/080/34 dated 28.04.2003, i shares of M/s Talent Infoway Pvt. Ltd. in cash. However, the company Goldstar Finvest Pvt. Ltd. was operated by Mr. Mukesh M. Choksi who during the course of the search by the Income Department admitted that companies operated engaged in providing accommodation entries only without any real transactions. 7.2 In the instant case, i the AO in the documents filed by the assessee assessee to discharge transactions, however, neither the assessee produced any case laws cited by the Ld. AR, the same were found to be distinguishable on facts. Further, the A.O. has made the addition on account of unexplained investment and therefore, the plea of the appellant that no addition can be made u/s. 68 doesn't hold much of ground. The same is reiected. The addition so made by the A.O. is accordingly confirmed. The grounds of appeal are dismissed.” Before us, the assessee has referred to copy of pur 6, 8 and 10), purchase bills (PB 5, 7 and 9), (PB 12, 15, 16, 19 and 20), sales bills (PB 11, 13, 14, 17 and 18) copy of share certificates (PB 21 to 29) copy of demat statement (PB 32), copy of bank passbook and (PB 39, 40). The assessee has also filed copy of receipt issued by Goldstar Finvest Pvt. Ltd. i.e. receipt of Rs.270/- CC/2003/207/87 dated 24.04.2003 and Rs.17,498/ C/2003/080/34 dated 28.04.2003, in support of purchase of of M/s Talent Infoway Pvt. Ltd. in cash. However, the company Goldstar Finvest Pvt. Ltd. was operated by Mr. Mukesh M. Choksi who during the course of the search by the Income Department admitted that companies operated engaged in providing accommodation entries only without any real In the instant case, in view of the discrepancies pointed out in the documents filed by the assessee, he asked to discharge her onus of establishing genuineness of however, neither the assessee produced any Mrs. Taruna Kataria 14 ITA No. 584/Mum/2013 case laws cited by the Ld. AR, the same were found to be distinguishable on facts. Further, the A.O. has made the addition on account of unexplained f the appellant that no addition can be made u/s. 68 doesn't hold much of ground. The same is reiected. The addition so made by the A.O. is accordingly confirmed. The Before us, the assessee has referred to copy of purchase (PB 5, 7 and 9), (PB 12, 15, 16, 19 and 20), sales bills (PB 11, 13, 14, 17 and 18) copy of share certificates (PB 21 to 29) copy of and balance sheet (PB 39, 40). The assessee has also filed copy of receipt issued by the against bill No. CC/2003/207/87 dated 24.04.2003 and Rs.17,498/- against bill n support of purchase of of M/s Talent Infoway Pvt. Ltd. in cash. However, the company Goldstar Finvest Pvt. Ltd. was operated by Mr. Mukesh M. Choksi who during the course of the search by the Income-tax Department admitted that companies operated by him were engaged in providing accommodation entries only without any real n view of the discrepancies pointed out by , he asked the stablishing genuineness of however, neither the assessee produced any confirmation from M/s Goldstar Finvest Pvt. Ltd. nor produce party before the Assessing Officer the assessee that it has discharged its onus of establishing genuineness of the transaction, reasons that firstly, the assessee did not file any confirmation fr the said party i.e. M/s Goldstar carried out actual transactions of the purchase of shares of M/s Talent infoway Private Limited in the month of Secondly, the assessee assessee were absent on the backside of the share certificates. In such circumstances, the Assessing Officer asked the assessee to produce the said party for verification of the genuineness of the claim of the assessee, then onus shifted to the assessee, but the assessee did not make any attempt to comply the queries raised by the Assessing Officer. The decision relied upon by the learned counsel of the assessee relating to discharging of the onus are accordingly distinguishable and not applicable over the facts of the instant case. In the case of CIT Vs Orrisa Corporation P Ltd ( the assessee provided confirmation of the parties before the Assessing Officer and also provided complete name and address of those parties and requested for issue of the summon for enforcing their attendance, but in the instant case the assessee filed confirmation from M/s Gold request for enforcing their attendance. In the c (supra), the Tribunal found the explanation of the assessee confirmation from M/s Goldstar Finvest Pvt. Ltd. nor produce party before the Assessing Officer for verification. Thus, the claim of that it has discharged its onus of establishing transaction, has not been fulfilled due to the , the assessee did not file any confirmation fr the said party i.e. M/s Goldstar Finvest p Ltd that the assessee d out actual transactions of the purchase of shares of M/s Talent infoway Private Limited in the month of the assessee did not justify as why initials of the assessee were absent on the backside of the share certificates. In cumstances, the Assessing Officer asked the assessee to produce the said party for verification of the genuineness of the claim of the assessee, then onus shifted to the assessee, but the assessee did not make any attempt to comply the queries raised by e Assessing Officer. The decision relied upon by the learned counsel of the assessee relating to discharging of the onus are accordingly distinguishable and not applicable over the facts of the In the case of CIT Vs Orrisa Corporation P Ltd ( the assessee provided confirmation of the parties before the Assessing Officer and also provided complete name and address of those parties and requested for issue of the summon for enforcing but in the instant case the assessee iled confirmation from M/s GoldStar Finvest P Ltd , request for enforcing their attendance. In the case of KK Traders ribunal found the explanation of the assessee Mrs. Taruna Kataria 15 ITA No. 584/Mum/2013 confirmation from M/s Goldstar Finvest Pvt. Ltd. nor produced said Thus, the claim of that it has discharged its onus of establishing has not been fulfilled due to the , the assessee did not file any confirmation from Finvest p Ltd that the assessee d out actual transactions of the purchase of shares of M/s Talent infoway Private Limited in the month of April, 2003. did not justify as why initials of the assessee were absent on the backside of the share certificates. In cumstances, the Assessing Officer asked the assessee to produce the said party for verification of the genuineness of the claim of the assessee, then onus shifted to the assessee, but the assessee did not make any attempt to comply the queries raised by e Assessing Officer. The decision relied upon by the learned counsel of the assessee relating to discharging of the onus are accordingly distinguishable and not applicable over the facts of the In the case of CIT Vs Orrisa Corporation P Ltd (supra), the assessee provided confirmation of the parties before the Assessing Officer and also provided complete name and address of those parties and requested for issue of the summon for enforcing but in the instant case the assessee has neither Finvest P Ltd , nor made any ase of KK Traders ribunal found the explanation of the assessee plausible and supported by the evidence, whereas in t case, the documents filed by the assessee do not give confidence of genuineness of the transaction. Similar is the finding in the case of SM Construction (supra) and Bhanwarlal Jain (supra) relied upon by the assessee. The ratio of the above dec applicable over the facts of the instant case. 7.3 The second contention of the assessee Officer has relied mainly on the confessional statement of third party. In our opinion, opportunity to the assessee to discharge her onus of establishing the genuineness of the transaction and in view of the failure on the part of the assessee, the Assessing Officer has also referred to the information gathered which was duly confronte The addition has been not party, but also in view of the failure of the assessee in discharging its onus laid down under section 68 of the A reject the contention of the assessee. the assessee are therefore not applicable over the facts of the instant case and accordingly distinguishable. 7.4 The third contention of the assessee evidence on record to support transfer of M/s GoldStar finvest private Limited. The learned counsel of the assessee has relied on the decision of L said case allegations were plausible and supported by the evidence, whereas in t case, the documents filed by the assessee do not give confidence of genuineness of the transaction. Similar is the finding in the case of SM Construction (supra) and Bhanwarlal Jain (supra) relied upon by the assessee. The ratio of the above decisions is therefore not the facts of the instant case. The second contention of the assessee is that Officer has relied mainly on the confessional statement of third opinion, the Assessing Officer has allow opportunity to the assessee to discharge her onus of establishing the genuineness of the transaction and in view of the failure on the part of the assessee, the Assessing Officer has also referred to the information gathered which was duly confronted to the assessee. The addition has been not made merely on statement of the third party, but also in view of the failure of the assessee in discharging d down under section 68 of the Act. We accordingly reject the contention of the assessee. The decisions therefore not applicable over the facts of the instant case and accordingly distinguishable. contention of the assessee is that there evidence on record to support transfer of cash from the assessee to invest private Limited. The learned counsel of the has relied on the decision of Lavnya Land P Ltd (supra). In case allegations were of regarding cash payments to sellers of Mrs. Taruna Kataria 16 ITA No. 584/Mum/2013 plausible and supported by the evidence, whereas in the instant case, the documents filed by the assessee do not give confidence of genuineness of the transaction. Similar is the finding in the case of SM Construction (supra) and Bhanwarlal Jain (supra) relied upon isions is therefore not that the Assessing Officer has relied mainly on the confessional statement of third- the Assessing Officer has allowed the opportunity to the assessee to discharge her onus of establishing the genuineness of the transaction and in view of the failure on the part of the assessee, the Assessing Officer has also referred to the d to the assessee. statement of the third- party, but also in view of the failure of the assessee in discharging ct. We accordingly s relied upon by therefore not applicable over the facts of the that there were no cash from the assessee to invest private Limited. The learned counsel of the avnya Land P Ltd (supra). In regarding cash payments to sellers of the land based on seized doc by the AO or statement was recorded from the vendors of in different villages and the T not be sustained. In background of held that finding was mixed one and there was no substantial question of law arising from such orders. In our opinion, ratio of the said decision is not applicable over facts of the instant case. In this case the assessee was primarily required to discharge its onus under section 68 of the A assessee in doing so, the Assessing Officer is justified in making the addition. 7.5 Fourthly, the assessee has contended that no cross examination of Sh Mukesh Chokasi has been provided to the assessee. The departmental representative submitted that no such cross-examination was sought before the lower us, the assessee has not produced any evidence to support that she sought cross-examination of Shri Mukesh M. Choksi before lower authorities and therefore, the decisions relied upon in the case of Andaman Timber Industries Ltd. (supra) is not applicable over the facts of the case. 7.6 Further on verification of the purchase contract note on PB-8, we find that assessee Talent Infoway Pvt. Ltd. by way of orders placed on 24.04.2003. The the land based on seized documents but no enquiry was carried out or statement was recorded from the vendors of in different villages and the Tribunal concluded that addition could not be sustained. In background of those facts, Hon’ble was mixed one and there was no substantial question of law arising from such orders. In our opinion, ratio of the said decision is not applicable over facts of the instant case. In this case the assessee was primarily required to discharge its onus ction 68 of the Act, and in failure on the part of the assessee in doing so, the Assessing Officer is justified in making the , the assessee has contended that no cross examination of Sh Mukesh Chokasi has been provided to the The departmental representative submitted that no such examination was sought before the lower authorities. us, the assessee has not produced any evidence to support that she examination of Shri Mukesh M. Choksi before lower authorities and therefore, the decisions relied upon in the case of Andaman Timber Industries Ltd. (supra) is not applicable over the Further on verification of the purchase contract note 8, we find that assessee has purchased the shares M/s Talent Infoway Pvt. Ltd. by way of orders placed on 24.04.2003. The Mrs. Taruna Kataria 17 ITA No. 584/Mum/2013 uments but no enquiry was carried out or statement was recorded from the vendors of the land ribunal concluded that addition could , Hon’ble High Court was mixed one and there was no substantial question of law arising from such orders. In our opinion, ratio of the said decision is not applicable over facts of the instant case. In this case the assessee was primarily required to discharge its onus ct, and in failure on the part of the assessee in doing so, the Assessing Officer is justified in making the , the assessee has contended that no cross- examination of Sh Mukesh Chokasi has been provided to the The departmental representative submitted that no such authorities. Before us, the assessee has not produced any evidence to support that she examination of Shri Mukesh M. Choksi before lower authorities and therefore, the decisions relied upon in the case of Andaman Timber Industries Ltd. (supra) is not applicable over the Further on verification of the purchase contract note available has purchased the shares M/s Talent Infoway Pvt. Ltd. by way of orders placed on 24.04.2003. The relevant part of the contract note showing the purchase by the different order is reproduced as under: 7.7 Thus the contract note shows the quantity of bunch of 2000 shares whereas the share certificates are in the bunch of the 5000 shares available on page 21, 22, 24 and 25 composite share certificate for 5000 shares and not given any explanation as how it was possible for placing separate orders for purchase of the shares in the quantity of less than 5000. The assessee section 13 of Security 7.8 Further, we find that on the back side of the share certificates (i.e. available on PB 21 to 29 against the relevant column for initials. Further, evidence on record as sent to the company holder and how and when share certificates to the assessee. In absence of such documentary relevant part of the contract note showing the purchase by the different order is reproduced as under: Thus the contract note shows the quantity of bunch of 2000 shares whereas the share certificates are in the bunch of the 5000 available on page 21, 22, 24 and 25 shows that same are composite share certificate for 5000 shares and the assessee has any explanation as how it was possible for placing separate orders for purchase of the shares in the quantity of less than 5000. The assessee has also not explained non ecurity Contract (regulation) Act,1956 er, we find that on the back side of the share certificates available on PB 21 to 29 )there are no initials of the assessee against the relevant column for initials. Further, as how and when the share certificates were company for entering the name of the assessee as share and when the company has returned share certificates to the assessee. In absence of such documentary Mrs. Taruna Kataria 18 ITA No. 584/Mum/2013 relevant part of the contract note showing the purchase by the Thus the contract note shows the quantity of bunch of 2000 shares whereas the share certificates are in the bunch of the 5000 shows that same are the assessee has any explanation as how it was possible for placing separate orders for purchase of the shares in the quantity of less on-compliance of ,1956. er, we find that on the back side of the share certificates there are no initials of the assessee against the relevant column for initials. Further, there is no the share certificates were for entering the name of the assessee as share returned back those share certificates to the assessee. In absence of such documentary evidences, it can’t be established that those purchased in cash by the assessee on Without confirmation of purchase, the sale also becomes non reliable. The caselaws relied upon by the assessee are each and every case and cannot be applied without comparin facts of the said case. In the case of (supra) the Tribunal has deleted the addition holding the double speaking by Shri Mukesh M. Choksi during the cross whereas in the instant case no such facts are case of Shri Vineet Sureshchandra Agarwal in ITA No. 1442/Ahd/2013 for AY 2005 has followed the finding of the Co the case of Shri Jafferali K Rattonsey (supra) therefore, the rat the said case is also not applicable over the facts of the instant case. 7.9 We find that, the Assessing Officer has duly noted that Tribunal in the case of Goldstar Finvest Pvt. Ltd. along with other companies of M/s Mahasagar Securities for AY 2002-03 ) has held that those companies were engaged in providing accommodation entries against a commission receipt @ 0.15%. In view of the said finding there is no doubt left that purchase and sale bills issued by Goldstar Finvest Pvt assessee are bogus and not reliable. by the assessee for those purchases are without any confirmation evidences, it can’t be established that those shares were actu purchased in cash by the assessee on 24.4.2003 & Without confirmation of purchase, the sale also becomes non laws relied upon by the assessee are each and every case and cannot be applied without comparin facts of the said case. In the case of Shri Jafferali K Rattonsey the Tribunal has deleted the addition holding the double speaking by Shri Mukesh M. Choksi during the cross whereas in the instant case no such facts are in existen case of Shri Vineet Sureshchandra Agarwal in ITA No. 1442/Ahd/2013 for AY 2005-06 the Tribunal Bench Ahmedabad has followed the finding of the Co-ordinate Bench of the Tribunal in the case of Shri Jafferali K Rattonsey (supra) therefore, the rat the said case is also not applicable over the facts of the instant We find that, the Assessing Officer has duly noted that Tribunal in the case of Goldstar Finvest Pvt. Ltd. along with other companies of M/s Mahasagar Securities ( ITA No. 462/Mum/2005 has held that those companies were engaged in providing accommodation entries against a commission receipt @ 0.15%. In view of the said finding there is no doubt left that bills issued by Goldstar Finvest Pvt assessee are bogus and not reliable. The payment receipt by the assessee for those purchases are without any confirmation Mrs. Taruna Kataria 19 ITA No. 584/Mum/2013 shares were actually 24.4.2003 & 28.04.2003. Without confirmation of purchase, the sale also becomes non- laws relied upon by the assessee are in facts of the each and every case and cannot be applied without comparing the Shri Jafferali K Rattonsey the Tribunal has deleted the addition holding the double speaking by Shri Mukesh M. Choksi during the cross-examination in existence. In the case of Shri Vineet Sureshchandra Agarwal in ITA No. 06 the Tribunal Bench Ahmedabad ordinate Bench of the Tribunal in the case of Shri Jafferali K Rattonsey (supra) therefore, the ratio of the said case is also not applicable over the facts of the instant We find that, the Assessing Officer has duly noted that Tribunal in the case of Goldstar Finvest Pvt. Ltd. along with other 462/Mum/2005 has held that those companies were engaged in providing accommodation entries against a commission receipt @ 0.15%. In view of the said finding there is no doubt left that bills issued by Goldstar Finvest Pvt. Ltd. to the The payment receipt produced by the assessee for those purchases are without any confirmation by those parties and cannot be relied shares of Talent Infoways p Ltd by the assess transaction of the shares of M/s Talent Infoway Pvt. Ltd. is concerned the contention of the assessee that those transaction have been carried out on sales as well as purchase party, accommodation entry sales take entries of bogus loss and whenever any sales of such penny stock companies are transacted from the stock market buyer will buy those shares want to take loss and already in loop of the entire come forward and bu assessee that there is anonymity of the buyer and seller is not applicable in the c transactions. 8. As far as contention of the assessee that the Ld. CIT(A) has held the holding period of shares a demat period to the date of the sale, w the sale transaction has held to be unexplained credit u/s 68 of the Act, issue of holding period is only academic in nature and we are not adjudicating upon same. 9. In view of the above discussion, we uphold the finding of the Ld. CIT(A) on the issue in disput assessee are accordingly dismissed. and cannot be relied upon to support purchase of shares of Talent Infoways p Ltd by the assessee. transaction of the shares of M/s Talent Infoway Pvt. Ltd. is concerned the contention of the assessee that those transaction carried out on stock exchange , so there is anonymity of purchase party, we find that in such accommodation entry sales, there is a set of buyers who want to take entries of bogus loss and whenever any sales of such penny stock companies are transacted from the stock market will buy those shares and only exit providers i.e. persons who and already in loop of the entire uy those shares. Thus, the contentions assessee that there is anonymity of the buyer and seller is not applicable in the case of such arranged and preplanned As far as contention of the assessee that the Ld. CIT(A) has d the holding period of shares as less than 12 months period to the date of the sale, we are of the view that when e transaction has held to be unexplained credit u/s 68 of the issue of holding period is only academic in nature and we are not adjudicating upon same. In view of the above discussion, we uphold the finding of the Ld. CIT(A) on the issue in dispute. The grounds of appeal of the assessee are accordingly dismissed. Mrs. Taruna Kataria 20 ITA No. 584/Mum/2013 upon to support purchase of ee. As far as sale transaction of the shares of M/s Talent Infoway Pvt. Ltd. is concerned the contention of the assessee that those transaction there is anonymity of at in such type of bogus there is a set of buyers who want to take entries of bogus loss and whenever any sales of such penny stock companies are transacted from the stock market, no genuine and only exit providers i.e. persons who and already in loop of the entire process , will . Thus, the contentions of the assessee that there is anonymity of the buyer and seller is not arranged and preplanned As far as contention of the assessee that the Ld. CIT(A) has s less than 12 months i.e. from e are of the view that when e transaction has held to be unexplained credit u/s 68 of the issue of holding period is only academic in nature and we are In view of the above discussion, we uphold the finding of the e. The grounds of appeal of the 10. In the result, the appeal filed by the assessee is dismissed. Order pronounced in the open Court on Sd/- (NARENDER KUMAR CHOUDHRY JUDICIAL MEMBER Mumbai; Dated: 24/08/2023 Rahul Sharma, Sr. P.S. Copy of the Order forwarded to 1. The Appellant 2. The Respondent. 3. CIT 4. DR, ITAT, Mumbai 5. Guard file. //True Copy// In the result, the appeal filed by the assessee is dismissed. nounced in the open Court on 24/08/2023. Sd/ NARENDER KUMAR CHOUDHRY) (OM PRAKASH KANT JUDICIAL MEMBER ACCOUNTANT MEMBER Copy of the Order forwarded to : BY ORDER, (Assistant Registrar) ITAT, Mumbai Mrs. Taruna Kataria 21 ITA No. 584/Mum/2013 In the result, the appeal filed by the assessee is dismissed. /08/2023. Sd/- OM PRAKASH KANT) ACCOUNTANT MEMBER BY ORDER, (Assistant Registrar) ITAT, Mumbai