PALLAVI PANDEY, MUMBAI V. DCIT (CC) 2(3), MUMBAI

ITA 7124/MUM/2019

• Counselvise Citation: [2020] 109 COUNSELVISE.COM (IT) 9277 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 1 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-12-2020
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: C
• Assessment Year: 2013-2014
• Appeal Filed On: 19-11-2019
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: MANPREET SINGH DUGGAL
• Assessee Lawyers: ANIL SHATHE
• Keywords: Reopening of assessment; Unexplained expenditure; Business income; Share purchase agreement; Bonafide belief; Question of law; Tangible material; Accommodation entries; Penny stocks; Reason to believe; Set aside; Capital Gains
• Section: 69C; 143(3); 264; 139(1); 48; 13; 147; 131; 68; 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCH D, MUMBAI BEFORE SHRI RAJESH KUMAR, ACCOUNTANT MEMBER AND SHRI AMARJIT SINGH, JUDICIAL MEMBER ITA NO.7124/M/2019 ASSESSMENT YEAR: 2013-14 MR S. PALLAVI PANDEY, PREMISES NO.1 & 2, 4 TH FLOOR, SHREEPATI ARCADE, AUGUST KRANTI MARG, NANA CHOWK, MUMBAI 400 036 PAN: AGUPC 1894N VS. D CIT (CC) 2( 3 ), 8 TH FLOOR, ROOM NO.803, OLD CGO BLDG. PRATISHTHA BHAVAN, M.K. ROAD, MUMBAI - 400020 (APPELLANT) (RESPONDENT ) ITA NO.7581/M/2019 ASSESSMENT YEAR: 2013-14 SHRI RAJENDRA CHATURVEDI, PREMISES NO.1 & 2, 4 TH FLOOR, SHREEPATI ARCADE, AUGUST KRANTI MARG, NANA CHOWK, MUMBAI 400 036 PAN: ACZPC 5041Q VS. DCIT (CC) 2(3), 8 TH FLOOR, ROOM NO.803, OLD CGO BLDG. PRATISHTHA BHAVAN, M.K. ROAD, MUMBAI - 400020 (APPELLANT) (RESPONDENT ) PRESENT FOR: ASSESSEE BY : SHRI ANIL SHATHE, A.R. REVENUE BY : SHRI MANPREET SINGH DUGGAL, D.R. DATE OF HEARING : 09.11.2020 DATE OF PRONOUNCEMENT : 23.12.2020 O R D E R PER RAJESH KUMAR, ACCOUNTANT MEMBER: THE ABOVE TITLED APPEALS HAVE BEEN PREFERRED BY TW O DIFFERENT ASSESSEES AGAINST THE ORDER DATED 30.08.2 019 OF THE ITA NO.7124/M/2019 & ITA NO.7581/M/2019 MRS. PALLAVI PANDEY & SHRI RAJENDRA CHATURVEDI 2 COMMISSIONER OF INCOME TAX (APPEALS) [HEREINAFTER R EFERRED TO AS THE CIT(A)] RELEVANT TO ASSESSMENT YEAR 2013-14. ITA NO.7581/M/2019 2. THE GROUND RAISED BY THE ASSESSEE ARE AS UNDER: 1. THE REASSESSMENT IS BAD IN LAW AS THE ASSESSMENT WA S REOPENED BASED ONLY ON THE INFORMATION FROM THE INVESTIGATION WING. THE STATEMENTS MADE BY SOME BROKERS WHICH ARE NOT RELATED TO THE APPELLANT CANNOT BE CONSIDERED AS TANGIBLE MATERIAL TO FORM A BELIEF THAT THE INCOME HAS ESCAPED ASSESSMENT. THE NAMES OF THE APPELLANT'S BROKERS ARE NOT AT ALL MENTIONED IN THE LIST OF BROKERS INDULGED IN PROVIDING ACCOMMODATION ENTRIES . 2. WITHOUT PREJUDICE TO THE ABOVE, THE LEARNED CIT(A) ERRED IN UPHOLDING THE ACTION OF THE ASSESSING OFFICER IN TREATING THE LON G-TERM CAPITAL GAINS ACCRUING TO THE APPELLANT AS NON-GENUINE ONLY ON THE BASIS O F GENERAL FINDING OF DIRECTORATE OF INVESTIGATION AND ADMISSION BY OPERA TORS, ENTRY PROVIDERS AND STOCK BROKERS IN GENERAL OF HAVING PROVIDED THE ACC OMMODATION ENTRIES AND WHEN THERE WAS NO COGENT MATERIAL ON RECORD AND NO DIRECT NEXUS / CONNECTION WITH THE APPELLANT WAS ESTABLISHED TO PR OVE THE IMPUGNED TRANSACTION AS BOGUS. 3. THE LEARNED CIT(A) FAILED TO TAKE COGNIZANCE OF DOC UMENTARY EVIDENCE PROVIDED BY THE APPELLANT SUCH AS BANK STATEMENTS, BROKERS' CONTRACT NOTES AND LEDGER ACCOUNTS, DEMAT ACCOUNTS, ETC. TO SUBSTA NTIATE THE TRANSACTIONS OF PURCHASE AND SALE OF SHARES. THE ADDITION MADE U/S 68 IS MERELY ON PRESUMPTIONS, SUSPICION, SURMISES AND CONJECTURES D ISREGARDING THE DIRECT EVIDENCE PLACED ON RECORD. 4. THE LEARNED CIT(A) ERRED IN DENYING THE BENEFIT OF SEC. 10(38) OF THE ACT TO THE APPELLANT WHEN ALL THE CONDITIONS FOR CLAIMING EXEMPTION ARE SATISFIED BY THE APPELLANT. 5. THE LEARNED CIT(A) ERRED IN TREATING THE TRANSACTIO N OF THE APPELLANT AS NON- GENUINE RELYING ONLY ON CIRCUMSTANTIAL EVIDENCE SUC H AS PRICE MOVEMENTS OF THE EQUITY SHARE WHICH IS BEYOND THE CONTROL OF THE APPELLANT. 6. THE LEARNED CIT(A) ERRED IN UPHOLDING THE ADDITION OF UNEXPLAINED EXPENDITURE U/S 69C OF RS. 2,07,41,9627- BEING FIVE PERCENT OF THE CAPITAL GAINS ON ACCOUNT OF ALLEGED COMMISSION PAID TO THE BROKER FOR ARRANGING ARTIFICIAL CAPITAL GAINS, WITHOUT THERE BEING ANY C ORROBORATIVE EVIDENCE. 7. THE LEARNED ASSESSING OFFICER ERRED IN IGNORING THE VARIOUS JUDICIAL PRONOUNCEMENTS CITED BY THE APPELLANT IN HER FAVOUR . 8. THE APPELLANT CRAVES LEAVE TO ADD, ALTER OR AMEND A NY OF THE GROUNDS OF THE APPEAL, AT ANY TIME BEFORE OR AT THE TIME OF HEARIN G. ITA NO.7124/M/2019 & ITA NO.7581/M/2019 MRS. PALLAVI PANDEY & SHRI RAJENDRA CHATURVEDI 3 3. THE ISSUE RAISED IN GROUND NO.1 IS A JURISDICTI ONAL ISSUE CHALLENGING THE CONFIRMATION OF REOPENING OF ASSESS MENT PROCEEDINGS BY THE LD. CIT(A) AS MADE BY THE AO UND ER SECTION 147 READ WITH SECTION 148 OF THE ACT. 4. THE FACTS ARE THAT THE ASSESSEE IS AN INDIVIDUAL AND PROMOTER OF SRINATH GROUP OF BUILDER AND DEVELOPERS . DURING THE YEAR, THE ASSESSEE FILED THE RETURN OF INCOME O N 30.03.2015 DECLARING A TOTAL INCOME OF RS.6,97,66,920/-. THE CASE OF THE ASSESSEE WAS SELECTED FOR SCRUTINY AND ASSESSMENT W AS FRAMED VIDE ORDER DATED 30.03.2016 PASSED UNDER SECTION 14 3(3) OF THE ACT ASSESSING THE TOTAL INCOME AT RS.6,99,41,920/-. SUBSEQUENTLY, THE AO REOPENED THE CASE OF THE ASSES SEE ON THE BASIS OF INFORMATION RECEIVED FROM DIRECTORATE OF I NVESTIGATION, KOLKATA AND MUMBAI THAT ASSESSEE IS A BENEFICIARY O F BOGUS LONG TERM CAPITAL GAIN ARISING FROM PENNY STOCKS. ACCOR DING TO THE INFORMATION RECEIVED BY THE AO FROM DIRECTORATE OF INVESTIGATION, KOLKATA THE ASSESSEE IS A BENEFICIARY OF ENTRIES OF RS.41,48,39,241/- IN RESPECT OF SHARES OF M/S. SHRI NATH COMMERCIAL AND FINANCE LTD. AND CLAIMED EXEMPTION U NDER SECTION 10(38) IN RESPECT OF LONG TERM CAPITAL GAIN OF RS.35,44,38,501/-. BASED ON THE SAID INFORMATION T HE AO REOPENED THE ASSESSMENT OF THE ASSESSEE AFTER RECOR DING REASONS TO BELIEVE UNDER SECTION 148(2) OF THE ACT BY ISSUING NOTICE U/S 148 OF THE ACT DATED 19.10.2016. IN RES PONSE TO THE SAID NOTICE ISSUED UNDER SECTION 148, THE ASSESSEE VIDE LETTER DATED 28.12.2016 SUBMITTED THAT THE RETURN FILED OR IGINALLY UNDER SECTION 139(1) OF THE ACT ON 30.03.2015 MAY K INDLY BE TREATED AS FILED IN RESPONSE TO NOTICE UNDER SECTIO N 148 AND ALSO REQUESTED TO PROVIDE THE REASONS RECORDED FOR REOP ENING THE ITA NO.7124/M/2019 & ITA NO.7581/M/2019 MRS. PALLAVI PANDEY & SHRI RAJENDRA CHATURVEDI 4 ASSESSMENT. THE ASSESSEE WAS PROVIDED REASONS RECO RDED UNDER SECTION 148(2) ON 31.05.2017 AND THEREAFTER OBJECTI ONS TO THE REOPENING OF ASSESSMENT WERE FILED VIDE LETTER DAT ED 06.10.2017 BY THE ASSESSEE. THE ASSESSEE HAD PURCHASED 28 LAK H SHARES OF M/S. SHRINATH COMMERCIAL AND FINANCE LTD. DURING A SPAN COMMENCING FROM 04.03.2011 TO 15.03.2011. THEREAFT ER A BONUS ISSUE IN THE RATIO OF 1:1 WAS BROUGHT OUT BY THE COMPANY ON 22.03.2011. CONSEQUENTLY THE TOTAL HOLDING OF TH E ASSESSEE BECAME 56 LAKH SHARES WHICH WERE SOLD BY THE ASSESS EE DURING THE PERIOD BEGINNING FROM 23.08.2012 TO 08.02.2013 FOR AGGREGATE CONSIDERATION OF RS.41,48,39,241/- THEREB Y MAKING A LONG TERM CAPITAL GAIN OF RS.35,43,35,716/- WHICH W AS CLAIMED AS EXEMPT UNDER SECTION 10(38) OF THE ACT. DURING THE ASSESSMENT PROCEEDINGS THE AO HAS NARRATED DETAILE D MODUS OPERANDI ADOPTED BY VARIOUS OPERATORS AND THE MANNE R IN WHICH THE PURCHASE AND SALE OF SHARES WERE RIGGED TO SPI RAL THE PRICES AND ACCOMMODATION PROVIDED BY VARIOUS BROKERS, RELA TED ENTITIES AND EXIT PROVIDERS. THE STATEMENT OF THE ASSESSEE WAS ALSO RECORDED UNDER SECTION 131 OF THE ACT. ACCORDING T O THE AO THE FINANCIAL STRENGTH OF M/S. SHRINATH COMMERCIAL AND FINANCE LTD. DOES NOT JUSTIFY THE INCREASE IN SALES PRICES WHICH BECAME CLEAR FROM THE STATEMENTS RECORDED OF VARIOUS BROKE RS AND OPERATORS DURING INVESTIGATION. THUS THE LONG TERM CAPITAL GAIN IS NOTHING BUT ACCOMMODATION RECEIVED BY THE ASSESS EE FROM THESE BROKERS. DURING THE ASSESSMENT PROCEEDINGS T HE AO REQUIRED THE ASSESSEE TO PROVE THE GENUINENESS OF T HE SHARE TRANSACTIONS AND THE RESULTING CAPITAL GAIN MADE TH EREFROM. DURING THE COURSE OF ASSESSMENT PROCEEDINGS THE ASS ESSEE FILED VARIOUS DOCUMENTS SUPPORTING THE SALE AND PURCHASE OF SHARES ITA NO.7124/M/2019 & ITA NO.7581/M/2019 MRS. PALLAVI PANDEY & SHRI RAJENDRA CHATURVEDI 5 TO PROVE THE GENUINENESS OF THE TRANSACTIONS. THE ASSESSEE SUBMITTED THAT THE PURCHASE OF SHARES WERE MADE THR OUGH STOCK EXCHANGE AND SHARES WERE CREDITED IN D-MAT ACCOUNT UPON PURCHASE. BESIDES THE PAYMENT WAS MADE THROUGH BANK ING CHANNELS. SIMILARLY, THE BONUS SHARES WERE ALSO CR EDITED IN D- MAT ACCOUNT. THE ASSESSEE ALSO SUBMITTED THAT SHAR ES WERE HELD MORE THAN 12 MONTHS BEFORE BEING SOLD THROUGH STOCK EXCHANGE AND DUE DEBIT WAS MADE THROUGH D-MAT ACCOU NT AND MONEY WAS TOO RECEIVED THROUGH BANKING CHANNELS. T HE AO, HOWEVER, DISBELIEVING THE VARIOUS DOCUMENTS FURNISH ED DURING THE COURSE OF HEARING AND ALSO THE VARIOUS CONTENTI ONS AND SUBMISSIONS PUT FORWARD BY THE ASSESSEE CAME TO CON CLUSION THAT FINANCIAL POSITION OF THE COMPANY WAS NOT SOUN D DURING THE PERIOD WHEN THE SHARES WERE HELD BY THE ASSESSEE. THE AO ALSO HELD THAT THE TRADING VOLUMES AND CORRELATION WITH SENSEX ON THE STOCK EXCHANGE DOES NOT JUSTIFY THE INCREASE IN THE SHARE PRICES OF THE COMPANY WHICH SHOWS THAT SHARE PRICES WERE C LEARLY MANIPULATED BY THE BROKERS IN ORDER TO YIELD UNDUE AND BOGUS GAIN TO THE ASSESSEE. THE AO ALSO NOTED THAT VARIO US SHARE BROKERS WHOSE STATEMENTS WERE RECORDED CONFIRMED TH E FACT OF THESE PENNY STOCK COMPANIES USED TO PROVIDE ACCOMMO DATION ENTRIES OF LONG TERM CAPITAL GAIN. SIMILARLY, VARI OUS EXIT PROVIDERS ALSO CONFIRMED THESE SHARES TO BE OF PE NNY STOCK COMPANIES. FINALLY, THE AO MADE THE ADDITION OF RS.41,48,39,241/- UNDER SECTION 68. THE AO FURTHER ADDED A SUM OF RS.2,07,41,962/- ON ACCOUNT OF COMMISSION PA ID BY THE ASSESSEE FOR SUCH ALLEGED ACCOMMODATION ENTRIES AND CONSIDERED THE SAME AS UNEXPLAINED UNDER SECTION 69C OF THE AC T . ITA NO.7124/M/2019 & ITA NO.7581/M/2019 MRS. PALLAVI PANDEY & SHRI RAJENDRA CHATURVEDI 6 5. AGGRIEVED BY THE ORDER OF AO, THE ASSESSEE WENT IN APPEAL BEFORE THE LD. CIT(A) CHALLENGING THE ORDER OF AO O N BOTH JURISDICTIONAL ISSUE AS WELL AS ON MERIT, HOWEVER T HE LD. CIT(A) DISMISSED THE APPEAL OF THE ASSESSEE ON BOTH COUNTS . THE LD. CIT(A) WHILE DISMISSING THE APPEAL ON JURISDICTIONA L ISSUE OBSERVED AND HELD AS UNDER: 5.1.3 IN VIEW OF THESE FACTS, AO HAD REASON TO BE LIEVE THAT INCOME TO THE EXTENT OF RS. 41,48,39,241/- HAD ESCAPED ASSESSMENT. THE FACT S TAKEN ON FACE VALUE BY ASSESSING OFFICER AT THE TIME OF ORIGINAL ASSESSMEN T WERE FOUND TO BE FALSE PRESENTATION OF FACTS. THUS FACTS THEMSELVES GOT CHANGED ON RECEIPT OF INFORMAT ION FROM INVESTIGATION WING. THUS, IT IS NOT CASE OF CH ANGE OF OPINION. 5 1.4 IN VIEW OF ABOVE DETAILED AND SATISFACTION NOTE OF AO ON THE BASIS OF NEW FACTS UNEARTHED BY INVESTIGATION WING AND MADE AVAI LABLE TO AO, IT IS HELD THAT AO WAS CORRECT IN ASSUMING JURISDICTION U/S 147 AND HA S CORRECTLY ISSUED NOTICE U/S 148. THE APPEAL OF ASSESSEE THEREFORE, DOES NOT SUCCEED ON THIS ACCOUNT. FOLLOWING CASE LAWS WHERE LAW IS EXPOUNDED IN THIS REGARD, SUPPORT THE ACTION OF AO:- (I) MCDOWELL'S 154 ITR 148(SC) - IN SO FAR THE 'COR PORATE VEIL' NEEDED TO BE LIFTED IN SUCH CASES TO DISTINGUISH 'APPARENT' FROM 'REAL'. A LL DOCUMENTS PLACED AT THE TIME OF 143(3) ASSESSMENT ARE FARCE AND PRINCIPLE OF ESS ENCE OF COLOURABLE DEVICE HAS TO BE APPLIED. (II) ITO VS PURSHOTTAM DAS BANGUR 90 TAXMANN.COM 54 1 (SC) - WHEREIN IT WAS PROPOUNDED BY HON'BLE SC THAT INFORMATION CONTAINED IN LETTER OF DIRECTORATE OF INVESTIGATION COULD BE SAID TO BE DEFINITE INFORMAT ION AND. ITO COULD ACT UPON FOR TAKING ACTION U/S 147(B) AND ITO COULD HAVE FORMED OPINION THAT THERE WAS REASON TO BELIEVE THAT INCOME HAD ESCAPED. (III) PHOOLCHAND BAJRANG LAL VS ITO 69 TAXMAN 627 ( SC) - ON IDENTICAL FACTS AS IN THE IMPUGNED CASE, ON SUBSEQUENT INFORMATION IT WAS FOU ND THAT TRANSACTIONS WERE FOUND TO BE BOGUS AND HENCE, MERE DISCLOSURE OF SUC H TRANSACTIONS AT THE TIME OF ORIGINAL ASSESSMENTS CANNOT BE SAID TO BE DISCLOSUR E OF 'TRUE' AND 'FULL FACTS' OF THE CASE AND HENCE ITOS JURISDICTION TO REOPEN SUCH CON CLUDED ASSESSMENT WAS HELD AS JUSTIFIABLE. 5 1.5 WHILE REJECTING ASSESSEES GROUND. I ALSO R ELY ON FOLLOWING CASE LAWS OF JURISDICTIONAL HIGH COURT (I) NICKUNI EXIMP ENTERPR ISE VS ACIT 48 TAXMANN.COM 20 (BOMBAY HC) SINCE GENUINENESS OF PURCHASE BILLS WAS NOT SUBJECT MATTER OF ORIGINAL ASSESSMENT U/S 143(3) AND THESE BILLS BEING BOGUS W AS DISCOVERED SUBSEQUENTLY TO 143(3) DURING SURVEY. (II) SOHAR SIRAJ. LOKHANDWALA VS ACIT (77 TAXMAN 302) BOMBAY H.C. MERE SUBMISSIONS OF DOCUMENTS IN THE ORIGINAL ASSESSMENT BUT NOT DISCLOSING 'FULL & TR UE FACTS OF THESE AND IF SOME MATERIAL LIES EMBEDDED I N EVIDENCE WHIILE ASSESSEE COULD HAVE UNCOVERED BUT DID NOT WILL AMOUNT TO NOT DISC LOSING FULL FACTS BY ASSESSEE THUS IN THE INSTANT CASE THE FACT OF THESE COMPANIE S BEING BOGUS AND ONLY PROVIDING ITA NO.7124/M/2019 & ITA NO.7581/M/2019 MRS. PALLAVI PANDEY & SHRI RAJENDRA CHATURVEDI 7 ENTRY WAS NOT DISCLOSED BY ASSESSEE HENCE WHAT WAS SUBMITTED WAS NOT TRUE. THEREFORE, FAILURE ON THE PART OF ASSESSEE. (III) YASH RAJ FILMS PVT LTD VS ACIT 15 TAXMANN.COM 275 BOMBAY HIGH COURT IN THIS CASE, IT WAS ON THE BASIS O F SURVEY ACTION THAT SEVERAL NEW FACTS CAME TO LIGHT AND SEVERAL DISCREPANCIES IN THE ACCOUNTS OF ASSESSEE W ERE DISCOVERED WHICH INDICATED ESCAPEMENT OF INCOME THUS REOPENING WAS HELD VALID. HENCE, GROUND NO. 1 AND ITS SUB-PARTS (A), (B) (C) AND (D) ARE DISMISSED. 6. AFTER HEARING BOTH THE PARTIES AND PERUSING THE MATERIAL ON RECORD, WE OBSERVE THAT IN THIS CASE A SPECIFIC INF ORMATION HAS BEEN RECEIVED BY THE AO FROM DIRECTORATE OF INVESTI GATION, KOLKATA AND MUMBAI THAT ASSESSEE IS BENEFICIARY OF HAWALA RACKET WHICH IS GIVING ACCOMMODATION ENTRIES IN THE FORM OF LONG TERM CAPITAL GAIN AND IS PART OF SEVERAL THOUSANDS OF CRORES SCAM AND ASSESSEE IS A BENEFICIARY OF THE SAID ORGA NIZED SCAM. THEREAFTER, THE AO AFTER ANALYZING THE INFORMATION RECEIVED FROM THE DIRECTORATE OF INVESTIGATION RECORDED REASONS UNDER SECTION 148(2) BY REFERRING TO THE RETURN OF INCOME FILED B Y THE ASSESSEE AND INFORMATION FURNISHED BY THE ASSESSEE QUA THE S ALE OF SHARES AND LONG TERM CAPITAL GAIN AND CAME TO CONCL USION THAT ASSESSEES INCOME HAS ESCAPED ASSESSMENT ACCORDINGL Y. IN OUR VIEW, THE REOPENING OF ASSESSMENT IS BASED ON SPECI FIC INFORMATION AS THE DIRECTOR OF INVESTIGATION HAS S PECIFICALLY PROVIDED INFORMATION TO THE AO THAT ASSESSEE IS BEN EFICIARY OF BOGUS LONG TERM CAPITAL GAIN WHICH IS A PART OF BIG RACKET. IN VIEW OF THESE FACTS ,WE DO NOT FIND ANY MERIT IN TH E CONTENTIONS OF THE ASSESSEE THAT THERE IS NO LINKAGE BETWEEN TH E REPORT OF THE INVESTIGATION WING, STATEMENT OF VARIOUS INDIVIDUAL RECORDED DURING THE SEARCH WITH THE FACTS OF THE APPELLANT. THOUGH THE STATEMENT OF VARIOUS PERSONS/BROKERS/EXIT PROVIDER DID NOT NAME THE ASSESSEE, HOWEVER, DURING OVERALL INVESTIG ATION OF THE ENTIRE SCAM THE ASSESSEES NAME CAME TO LIGHT THAT HE IS BENEFICIARY OF THESE BOGUS LONG TERM CAPITAL GAIN. THEREFORE, THE ITA NO.7124/M/2019 & ITA NO.7581/M/2019 MRS. PALLAVI PANDEY & SHRI RAJENDRA CHATURVEDI 8 DECISION RELIED UPON BY THE ASSESSEE IN THE CASE OF ITO VS. LAKMANI MEWAL DAS 103 ITR 437 (SC) IS NOT APPLICAB LE TO THE FACTS OF THE CASE. ACCORDINGLY, WE ARE INCLINED TO DISMISS THE GROUND RAISED BY THE ASSESSEE ON JURISDICTION. ACC ORDINGLY GROUND NO. 1 IS DISMISSED. 7. THE COMMON ISSUE RAISED IN GROUND NO.2 TO 7 IS ON M ERIT CHALLENGING THE ORDER OF LD. CIT(A) WHEREIN THE LD. CIT(A) HAS UPHELD THE ORDER OF AO THEREBY CONFIRMING THE ADDI TION OF RS. 41,48,39,241/- BY THE AO UNDER SECTION 68 OF THE A CT AND RS. 2,07,41,962/- U/S 69C OF THE ACT BEING 5% COMMISSIO N ON TOTAL SALES PROCEEDS. 8. THE FACTS QUA THIS ADDITION HAS ALREADY BEEN DI SCUSSED IN THE PARAS HEREINABOVE, THEREFORE THE SAME ARE NOT B EING REITERATED FOR THE SAKE OF BREVITY. THE LD. CIT(A) DISMISSED THE APPEAL OF THE ASSESSEE ON MERIT ALSO BY OBSERVING T HAT THE DOCUMENTS FILED AND LINE OF ARGUMENTS MADE BEFORE T HE APPELLATE AUTHORITY WERE SAME AS BEFORE THE AO AND ASSESSEE H AS NOT BROUGHT ANY NEW MATERIAL OR NEW ARGUMENTS BEFORE LD . CIT(A). THE LD. CIT(A) WHILE DISMISSING THE APPEAL HELD THA T IT WAS BROUGHT OUT DURING THE INVESTIGATION BY DIRECTORATE OF INVESTIGATION, KOLKATA AND MUMBAI THAT SHARES OF M/ S. SHRINATH COMMERCIAL AND FINANCE LTD. WERE MANIPULATED AND PR ICES WERE ARTIFICIALLY JACKED UP AND THE ENTIRE PROCESS OF PU RCHASE AND SALE OF SHARES WERE MANIPULATED TO REALIZE THE BOGUS GAI N IN FAVOUR OF VARIOUS BENEFICIARIES OF WHICH THE ASSESSEE WAS ONE . THE LD. CIT(A) NOTED THAT SHARES WERE PURCHASED AT A VERY L OW PRICE OF RS.10/- PER SHARES WHICH GOES TO AS HIGH AS RS.62 TO RS.81 IN A SPAN OF ONE YEAR. THE LD. CIT(A) WHILE DISMISSING THE APPEAL OF ITA NO.7124/M/2019 & ITA NO.7581/M/2019 MRS. PALLAVI PANDEY & SHRI RAJENDRA CHATURVEDI 9 THE ASSESSEE PASSED A VERY DETAILED ORDER COMMENCIN G FROM PARA NO.5.2 ON PAGE NO.6 TO PAGE 31 OF THE APPELLATE ORD ER. 9. THE LD. A.R. VEHEMENTLY SUBMITTED BEFORE US THAT THE ASSESSEE HAS FILED ALL THE NECESSARY DOCUMENTS TO P ROVE THE GENUINENESS OF THE PURCHASE AND SALE OF THE SHARES BY THE ASSESSEE OF M/S. SHRINATH COMMERCIAL AND FINANCE LT D. SUCH AS CONTRACT NOTES FOR PURCHASE AND SALE OF SHARES, COP Y OF D-MAT ACCOUNT EVIDENCING THE PURCHASE AND SALES OF SHARES , THE PROOFS OF PAYMENT THROUGH BANKING CHANNELS ETC. THE LD. A .R. SUBMITTED THAT SHARES WERE PURCHASED FROM RECOGNISE D STOCK EXCHANGE THROUGH REGISTERED SHARE BROKERS AND ALL THE PURCHASES AND SALE TRANSACTIONS WERE DULY EVIDENCED BY THE CONTRACT NOTES. SIMILARLY, THE PURCHASE CONSIDERATI ON WAS PAID THROUGH BANKING CHANNELS AND SALE CONSIDERATION TOO WAS ALSO RECEIVED THROUGH BANKING CHANNEL, STT DULY PAID AND ALL THE TRANSACTIONS WERE DULY REFLECTED IN THE RETURN OF I NCOME OF THE ASSESSEE. THESE SHARES WERE HELD FOR A PERIOD OF M ORE THAN ONE YEAR AND THEN SOLD YIELDING LONG TERM CAPITAL GAIN OF RS.35,44,38,501/- WHICH WAS CLAIMED AS EXEMPT UNDER SECTION 10(38) OF THE ACT. THE LD. A.R. SUBMITTED THAT ASS ESSEE HAS EVEN GIVEN THE DETAILS OF BROKERS THROUGH WHOM THESE TRA NSACTIONS WERE MADE AND THESE BROKERS WERE NOT THE PARTIES WH OSE STATEMENTS WERE RECORDED BY THE INVESTIGATION WING OR WHO HAD ADMITTED THAT THIS PARTICULAR SCRIPT WAS USED TO PR OVIDE BOGUS ENTRIES OF LONG TERM CAPITAL GAIN. THE LD. A.R. SU BMITTED THAT THERE IS NO SPECIFIC MENTION OF ASSESSEE OR HIS FAM ILY MEMBER IN ANY OF THE RECORDED STATEMENTS WHICH COULD ESTABLIS H THE NEXUS WITH THE WHOLE ARRANGEMENT OF PROVIDING AND ACCEPTI NG ACCOMMODATION ENTRIES BY THESE OPERATORS/EXIT PROVI DERS. THE ITA NO.7124/M/2019 & ITA NO.7581/M/2019 MRS. PALLAVI PANDEY & SHRI RAJENDRA CHATURVEDI 10 LD. A.R. SUBMITTED THAT THE ASSESSEE HAS CARRIED OU T THESE TRANSACTIONS THROUGH A RECOGNISED STOCK EXCHANGE AN D OPERATED THROUGH A MECHANISM WHICH IS LAWFUL PLATFORM FOR DO ING SUCH TRANSACTIONS. THEREFORE, THE LD. A.R. SUBMITTED TH AT THE ALLEGATION OF THE AO THAT ASSESSEE WAS HAND IN GLOV E WITH THESE PERSONS WHO WERE OPERATORS AND EXIT PROVIDERS WERE TOTALLY BASELESS AND BASED ON SURMISES AND CONJUNCTURES OF THE AUTHORITIES BELOW. THE LD. A.R. ALSO STRONGLY CONT ROVERTED THE FINDINGS GIVEN BY THE AUTHORITIES BELOW THAT THE DO CUMENTS FILED BY THE ASSESSEE WERE SELF SERVING/SHAM DOCUMENTS WH ILE THE SAME WERE CONTRACT NOTES D-MAT ACCOUNTS, BANK STATEMENTS/ACCOUNTS WHICH WERE ISSUED BY THIRD PA RTIES AND CAN NOT BE DESCRIBED AS SHAM/SELF SERVING DOCUMENTS . REFERRING TO THE ORDER PASSED BY SEBI, THE LD. A.R. SUBMITTED THAT THOUGH THE SEBI HAS PASSED AN ORDER ON 04.12.2014 WHEREAS THE TRANSACTIONS CARRIED OUT BY THE ASSESSEE HAVE TAKEN PLACE IN BETWEEN 2011AND 2013, AS SUCH THE ASSESSEE WAS UNDE R BONAFIDE BELIEF THAT ALL THESE WERE BONAFIDE SHARE TRANSACTIONS. THE LD AR FINALLY PRAYED THAT THE ADDITION MADE BY THE AO AND AS SUSTAINED BY THE CIT(A) MAY PLEASE BE DELETED. T HE LD. A.R. RELIED ON A SERIES OF DECISIONS TO DEFEND HIS ARGUM ENT AS UNDER: 1 COMMISSIONER OF INCOME-TAX V. SHYAM R. PAWAR ([2015 ] 229 TAXMAN 256 (BOMBAY HC)) 2 COMMISSIONER OF INCOME-TAX V. SMT. SUMITRA DEVI ([2 014] 49 TAXMANN 37 (RAJASTHAN HC)) 3 KAMLA DEVI S. DOSHI V. INCOME-TAX OFFICER ([2017] 8 8 TAXMANN 773 (MUMBAI - TRIB.)) 4 INCOME-TAX OFFICER V. M/S ARVIND KUMAR JAIN ITA NO. 4862/M/2014 5 SMT. MADHU KILLA V. ASSISTANT COMMISSIONER OF INCOM E-TAX ([2018] 100 TAXMANN 264 (KOLKATA - TRIB.)) ITA NO.7124/M/2019 & ITA NO.7581/M/2019 MRS. PALLAVI PANDEY & SHRI RAJENDRA CHATURVEDI 11 6 SWATI LUTHRA V. INCOME-TAX OFFICER ([2020] 115 TAXM ANN 167 (DELHI - TRIB.)) 7 SHRI VIJAYRATTAN BALKRISHAN MITTAL V. DY. COMMISSIO NER OF INCOME TAX (ITA 3427 TO 3429/MUM/2019) 8 DIPESH RAMESH VARDHAN V DCIT IN THE INCOME TAX APPE LLATE TRIBUNAL 'D' BENCH, MUMBAI (ITA7662/MUM/2019) THE LD. A.R. FINALLY PRAYED THAT IN VIEW OF THE FAC TS OF THE CASE OF THE ASSESSEE AND THE RATIO LAID DOWN BY THE HONBLE BOMBAY HIGH COURT, HON'BLE RAJASTHAN HIGH COURT AND THE CO -ORDINATE BENCHES OF THE TRIBUNAL, THE ORDER OF LD. CIT(A) MA Y KINDLY BE REVERSED AND AO MAY BE DIRECTED TO DELETE THE ADDIT ION MADE AS THE SAME IS BASED ON THE PRESUMPTIONS AND GUESS WOR K OF THE AO. 10. THE LD. D.R., ON THE OTHER HAND, STRONGLY OPPOS ED THE ARGUMENTS OF THE ASSESSEE BY SUBMITTING THAT THE SC AM WAS BROUGHT OUT BY THE DIRECTORATE OF INVESTIGATION, KO LKATA AND MUMBAI WHICH RUNS INTO SEVERAL THOUSANDS OF CRORES OF RUPEES. THIS WAS AN ORGANIZED RACKET CARRIED BY THE STOCK BROKERS/OPERATORS AND EXIT PROVIDER TO BENEFIT THE PARTIES IN THE FORM OF ACCOMMODATION OF LONG TERM CAPITAL GAIN WHI CH WAS CLAIMED AS EXEMPT UNDER SECTION 10(38) AND ASSESSEE WAS NONE OF THE BENEFICIARIES. THE LD. D.R. SUBMITTED THAT DURING THE SAID INVESTIGATION THE ASSESSEE WAS FOUND TO BE THE BENE FICIARY OF THE BOGUS LONG TERM CAPITAL GAIN AND HIS NAME CROPPED U P DURING THE INVESTIGATION ITSELF. IT IS ONLY THEREAFTER TH E INVESTIGATION WING PASSED ON THE INFORMATION TO THE AO ABOUT THE HUGE TRANSACTION OF PURCHASE AND SALE OF SHARES AND THE CONSEQUENT LONG TERM CAPITAL GAIN WHICH WAS CLAIMED AS EXEMPT UNDER SECTION 10(38) OF THE ACT. THE LD. D.R. REFERRED T O THE FINANCIAL ITA NO.7124/M/2019 & ITA NO.7581/M/2019 MRS. PALLAVI PANDEY & SHRI RAJENDRA CHATURVEDI 12 POSITION OF M/S. SHRINATH COMMERCIAL AND FINANCE LT D. AND SUBMITTED THAT THE FINANCIALS WERE POOR DURING THE PERIOD WHEN THE SHARES WERE HELD BY THE ASSESSEE AND DID NOT JU STIFY THE PHENOMENA INCREASE IN THE SHARE PRICES WHICH PROVED BEYOND DOUBT THAT THE PRICES OF THESE SHARES WERE MANIPULA TED AND RIGGED THROUGH AN ORGANIZED RACKET IN ORDER TO YIEL D THE BOGUS LONG TERM CAPITAL GAIN TO VARIOUS BENEFICIARIES INC LUDING ASSESSEE. THE LD. D.R. SUBMITTED THAT THE ASSESSEE WAS ONE OF THE BENEFICIARIES WHICH ALSO CAME TO LIGHT ONLY DUR ING THE COURSE OF INVESTIGATION THAT ASSESSEE HAS MADE HUGE PURCHA SES OF SHARES OF 26 LAKHS IN THE SAID COMPANY AT A MEAGER PRICE OF RS.10 /- EACH AND THEREAFTER A BONUS ISSUE WAS BROU GHT BY THE COMPANY AND HOLDINGS POST BONUS ISSUE CAME TO 52 L AKH SHARES. THEREAFTER, HOLDING THESE SHARES FOR MORE THAN 12 MONTHS AND THEN SELLING AT A VERY HIGH PRICE WHICH IS APPROXIMATELY EIGHT TIMES HIGHER THAN THE PURCHASE PRICE, DURING A SHORT SPAN OF 12 MONTHS WHICH ITSELF SHOWS THAT THIS LONG TERM CAPITAL GAIN IS NOTHING BUT ACCOMMODATIO N TAKEN FROM THE HAWALA OPERATORS IN AN ORGANIZED MANNER TR ANSACTED THROUGH THE RECOGNISED STOCK EXCHANGE. THE LD. D.R . FURTHER SUBMITTED THAT THE ENTIRE MODUS OPERANDI HAS BEEN B ROUGHT OUT AND DISCUSSED BY THE AO IN THE ASSESSMENT ORDER IN GREAT DETAIL. THE LD. D.R. FINALLY CONTENDED THAT EVEN THE CIRCUM STANTIAL EVIDENCES ARE AGAINST THE ASSESSEE AS THE ASSESSEE IS A BENEFICIARY OF A RACKET WHICH RUNS INTO SEVERAL THO USANDS OF CRORES. IN DEFENCE OF HIS ARGUMENT THE LD. D.R. HI GHLY RELIED ON THE ORDER OF LD. CIT(A) WHEREIN THE LD. CIT(A) RELI ED ON THE DECISION OF HONBLE SUPREME COURT IN THE CASE OF CI T VS. DURGAPRASAD MORE 82 ITR 540 AND SIMIT DAYAL VS. CIT 214 ITR ITA NO.7124/M/2019 & ITA NO.7581/M/2019 MRS. PALLAVI PANDEY & SHRI RAJENDRA CHATURVEDI 13 801 WHEREIN IT HAS BEEN HELD THAT THE TAX AUTHORITI ES ARE ENTITLED TO LOOK INTO THE SURROUNDINGS CIRCUMSTANCES TO FIND OUT THE TRUTH AND RELIED AND APPLIED THE TEST OF HUMAN PROB ABILITY. THE LD. D.R. ARGUED THAT THE DOCUMENTS PRODUCED BY THE ASSESSEE WERE SELF SERVING DOCUMENTS AND AUTHORITIES ARE NOT BOUND TO RELY ON THEM. LD. D.R. THEREFORE PRAYED BEFORE TH E BENCH THAT THE MERE PRODUCTION OF EVIDENCES WHICH ARE SHAM AND MANIPULATED CAN NOT BE RELIED AND THEREFORE THE ORD ER OF LD. CIT(A) DESERVED TO BE UPHELD ON THIS ISSUE BY DISMI SSING THE VARIOUS GROUNDS RAISED BY THE ASSESSEE ON MERIT. 11. WE HAVE HEARD THE RIVAL SUBMISSIONS OF BOTH THE PARTIES AND PERUSED THE MATERIAL ON RECORD INCLUDING THE VA RIOUS CASE LAWS REFERRED BY THE RIVAL PARTIES DURING THE COURS E OF HEARING. THE UNDISPUTED FACTS ARE THAT THE ASSESSEE HAS PURC HASED 28 LAKHS OF SHARES OF M/S. SHRINATH COMMERCIAL AND FIN ANCE LTD. BETWEEN 04.03.2011 TO 15.03.2011. M/S. SHRINATH CO MMERCIAL AND FINANCE LTD. THEREAFTER ISSUED BONUS SHARES IN THE RATIO OF 1:1 ON 22.03.2011 AND THUS THE ASSESSEE CAME TO HOL D 56 LAKH SHARES IN THE SAID COMPANY. WE NOTE THAT THESE SHA RES WERE PURCHASED THROUGH RECOGNISED STOCK EXCHANGE THRO UGH REGISTERED BROKER AND WERE CREDITED IN THE D-MAT A CCOUNT OF THE ASSESSEE. SIMILARLY THE BONUS SHARES WERE ALSO CR EDITED IN THE SAID D-MAT ACCOUNT HELD BY THE ASSESSEE. ALL THESE PURCHASE OF SHARES WERE SUPPORTED BY THE CONTRACT NOTES ISSUED BY THE AUTHORISED BROKERS OF THE STOCK EXCHANGE AND THE PA YMENTS WERE MADE THROUGH BANKING CHANNELS. THEREAFTER, TH E ASSESSEE SOLD THESE SHARES DURING THE PERIOD COMMENCING ON 2 3.08.2012 TO 08.02.2013 FOR A TOTAL CONSIDERATION OF RS.41,48 ,39,241/- AND WAS RECEIVED THROUGH BANKING CHANNEL THEREBY MAKING A LONG ITA NO.7124/M/2019 & ITA NO.7581/M/2019 MRS. PALLAVI PANDEY & SHRI RAJENDRA CHATURVEDI 14 TERM CAPITAL GAIN OF RS.35,44,38,501/- WHICH WAS CL AIMED AS EXEMPT UNDER SECTION 10(38) OF THE ACT AS LONG TERM CAPITAL GAIN ON SALE OF SHARES. WE NOTICE THAT ALL THESE TRANSA CTIONS WERE CARRIED OUT ON A RECOGNISED STOCK EXCHANGE BY THE A SSESSEE THROUGH REGISTERED BROKERS DULY EVIDENCED BY THE CO NTRACT NOTES AND ENTRIES IN THE D-MAT ACCOUNT AND THE SALE AND P URCHASE CONSIDERATION REACHED THROUGH BANKING CHANNELS. TH E AO HAS ALSO ONLY RELIED ON THE INVESTIGATION CARRIED OUT B Y THE INVESTIGATION WING, KOLKATA AND MUMBAI THAT ASSESSE E IS A BENEFICIARY OF THESE BOGUS LONG TERM CAPITAL GAIN E NTRIES. NOWHERE THE AO HAS BROUGHT ON RECORD ANY OTHER EVID ENCE THAN RELYING ON THE REPORT OF INVESTIGATION WING THAT TH E ASSESSEE IS BENEFICIARY OF THIS HUGE RACKET OF TAKING BOGUS ENT RIES OF LONG TERM CAPITAL GAIN. THE AO HAS DISBELIEVED THESE D OCUMENTS BY OBSERVING THAT THESE ARE SHAM AND BOGUS DOCUMENTS WITHOUT POINTING OUT ANY SPECIFIC DEFECT OR INFIRMITY AS TH ESE WERE ISSUED AS PER THE SYSTEM OF THE RECOGNISED STOCK EXCHANGE THROUGH REGISTERED BROKERS. SIMILARLY, THE LD. CIT(A) HAS UPHELD THE ORDER OF AO BY HOLDING THAT THE ASSESSEE IS BENEFIC IARY OF A BIG RACKET WHEREBY THE PRICES OF THE SHARES WERE RIGGED AND MANIPULATED TO YIELD BOGUS GAIN TO VARIOUS ENTITIES /INDIVIDUALS OF WHICH ASSESSEE WAS ONE. THUS WE FIND MERIT IN T HE ARGUMENTS OF THE LD A.R. THAT ASSESSEE HAS FURNISHE D ALL THE INFORMATIONS, DETAILS, DOCUMENTARY EVIDENCES BEFORE THE AO BUT THE AO HAS NOT DONE ANY FURTHER VERIFICATION TO FIN D OUT THE TRUTH OR DONE ANYTHING TO PROVE THE MONEY TRAIL OF THE F UNDS AS HAS BEEN ALLEGED IN THE ORDER. UNDER THESE CIRCUMSTANC ES, WE ARE NOT IN A POSITION TO SUSTAIN THE ORDER OF LD. CIT(A ) UPHOLDING THE ORDER OF AO WHEREIN THE LONG TERM CAPITAL GAIN HAS BEEN HELD TO ITA NO.7124/M/2019 & ITA NO.7581/M/2019 MRS. PALLAVI PANDEY & SHRI RAJENDRA CHATURVEDI 15 BE NON GENUINE AND BOGUS. THE CASE OF THE ASSESSEE IS SUPPORTED BY A SERIES OF DECISIONS AS RELIED UPON B Y THE LD. A.R. WHICH ARE DISCUSSED AS UNDER:- IN CASE OF CIT VS. SHYAM R. PAWAR (SUPRA) THE HONB LE BOMBAY HIGH COURT HAS DISMISSED THE APPEAL OF THE REVENUE BY OBSERVING AND HOLDING AS UNDER: 5. WE HAVE PERUSED THE CONCURRENT FINDINGS AND ON WHICH HEAVY RELIANCE IS PLACED BY MR.SURESHKUMAR. WHILE IT IS TRUE THAT THE COMMISSIONER EXTENSIVELY REFERRED TO THE CORRESPONDENCE AND THE CONTENTS OF THE REPORT OF THE INVESTIGATION CARRIED OUT IN PARAS 20, 20.1, 20.2 A ND 21 OF HIS ORDER, WHAT WAS IMPORTANT AND VITAL FOR THE PURPOSE OF THE PRESENT CASE WAS WHETHER THE TRANSACTIONS IN SHARES WERE GENUINE OR SHAM AND BOG US. IF THE PURCHASE AND SALE OF SHARES ARE REFLECTED IN THE ASSESSEE'S DMAT ACCOUNT, YET THEY ARE TERMED AS ARRANGED TRANSACTIONS AND PROJECTED TO BE REAL, THEN, SUCH CONCLUSION WHICH HAS BEEN REACHED BY THE COMMISSIONER AND THE ASSESSING OFFICER REQUIRED A DEEPER SCRUTINY. IT WAS ALSO REVEALED DU RING THE COURSE OF INQUIRY BY THE ASSESSING OFFICER THAT THE CALCUTTA STOCK EXCHA NGE RECORDS SHOWED THAT THE SHARES WERE PURCHASED FOR CODE NUMBERS S003 AND R12 1 OF SAGAR TRADE PVT. LTD. AND ROCKEY MARKETING PVT. LTD. RESPECTIVELY. O UT OF THESE TWO, ONLY ROCKEY MARKETING PVT. LTD. IS LISTED IN THE APPRAISAL REPO RT AND IT IS STATED TO BE INVOLVED IN THE MODUS-OPERANDI. IT IS ON THIS MATERIAL THAT HE HOLDS THAT THE TRANSACTIONS IN SALE AND PURCHASE OF SHARES ARE DOUBTFUL AND NOT GENUINE. IN RELATION TO ASSESSEE'S ROLE IN ALL THIS, AL! THAT THE COMMISSIO NER OBSERVED IS THAT THE ASSESSEE TRANSACTED THROUGH BROKERS AT CALCUTTA, WH ICH ITSELF RAISES DOUBT ABOUT THE GENUINENESS OF THE TRANSACTIONS AND THE FINANCI AL RESULT AND PERFORMANCE OF THE COMPANY WAS NOT SUCH AS WOULD JUSTIFY THE INCRE ASE IN THE SHARE PRICES. THEREFORE, HE REACHED THE CONCLUSION THAT CERTAIN O PERATORS AND BROKERS DEVISED THE SCHEME TO CONVERT THE UNACCOUNTED MONEY OF THE ASSESSEE TO THE ACCOUNTED INCOME AND THE PRESENT ASSESSEE UTILIZED THE SCHEME. 6. IT IS IN THAT REGARD THAT WE FIND THAT MR.GOPAL' S CONTENTIONS ARE WELL FOUNDED. THE TRIBUNAL CONCLUDED THAT THERE WAS SOMETHING MOR E WHICH WAS REQUIRED, WHICH WOULD CONNECT THE PRESENT ASSESSEE TO THE TRA NSACTIONS AND WHICH ARE ATTRIBUTED TO THE PROMOTERS/DIRECTORS OF THE TWO CO MPANIES. THE TRIBUNAL REFERRED TO THE ENTIRE MATERIAL AND FOUND THAT THE INVESTIGATION STOPPED AT A PARTICULAR POINT AND WAS NOT CARRIED FORWARD BY THE REVENUE. THERE ARE 1,30,000 SHARES OF BOLTON PROPERTIES LTD. PURCHASED BY THE ASSESSEE DURING THE MONTH OF JANUARY 2003 AND HE CONTINUED TO HOLD THEM TILL 31 MARCH 2003. THE PRESENT CASE RELATED TO 20,000 SHARES OF MANTRA ONL INE LTD FOR THE TOTAL CONSIDERATION OF RS.25,93,1507-. THESE SHARES WERE SOLD AND HOW THEY WERE SOLD, ON WHAT DATES AND FOR WHAT CONSIDERATION AND THE SUMS RECEIVED BY CHEQUES HAVE BEEN REFERRED EXTENSIVELY BY THE TRIBU NAL IN PARA 10. A COPY OF THE DM AT ACCOUNT, PLACED AT PAGES 36 & 37 OF THE A PPEAL PAPER BOOK BEFORE THE TRIBUNAL SHOWED THE CREDIT OF SHARE TRANSACTION . THE CONTRACT NOTES IN FORM-A WITH TWO BROKERS WERE AVAILABLE AND WHICH GA VE DETAILS OF THE ITA NO.7124/M/2019 & ITA NO.7581/M/2019 MRS. PALLAVI PANDEY & SHRI RAJENDRA CHATURVEDI 16 TRANSACTIONS. THE CONTRACT NOTE IS A SYSTEM GENERAT ED AND PRESCRIBED BY THE STOCK EXCHANGE. FROM THIS MATERIAL, IN PARA 11 THE TRIBUNAL CONCLUDED THAT THIS WAS NOT MERE ACCOMMODATION OF CASH AND ENABLING IT TO BE CONVERTED INTO ACCOUNTED OR REGULAR PAYMENT. THE DISCREPANCY POINT ED OUT BY THE CALCUTTA STOCK EXCHANGE REGARDING CLIENT CODE HAS BEEN REFER RED TO. BUT THE TRIBUNAL CONCLUDED THAT ITSELF, IS NOT ENOUGH TO PROVE THAT THE TRANSACTIONS IN THE IMPUGNED SHARES WERE BOGUS/SHAM. THE DETAILS RECEIV ED FROM STOCK EXCHANGE HAVE BEEN RELIED UPON AND FOR THE PURPOSES OF FAULT ING THE REVENUE IN FAILING TO DISCHARGE THE BASIC ONUS. IF THE TRIBUNAL PROCEEDS ON THIS LINE AND CONCLUDED THAT INQUIRY WAS NOT CARRIED FORWARD AND WITH A VIE W TO DISCHARGE THE INITIAL OR BASIC ONUS, THEN SUCH CONCLUSION OF THE TRIBUNAL CA NNOT BE TERMED AS PERVERSE. THE CONCLUSIONS AS RECORDED IN PARA 12 OF THE TRIBU NAL'S ORDER ARE NOT VITIATED BY ANY ERROR OF LAW APPARENT ON THE FACE OF THE REC ORD EITHER. 7. AS A RESULT OF THE ABOVE DISCUSSION, WE DO NOT F IND ANY SUBSTANCE IN THE CONTENTION OF MR.SURESHKUMAR THAT THE TRIBUNAL MISD IRECTED ITSELF AND IN LAW. WE HOLD THAT THE APPEALS DO NOT RAISE ANY SUBSTANTI AL QUESTION OF LAW. THEY ARE ACCORDINGLY DISMISSED. THERE WOULD NO ORDER AS TO C OSTS. IN THE CASE OF CIT VS SUMITRA DEVI(SUPRA), THE HON BLE RAJASTHAN HIGH COURT HAS HELD THAT WHERE THE ASSESS EE HAS FURNISHED ALL THE DOCUMENTS COMPRISING CONTRACT NO TES, BROKERS NOTE, CASH BOOK EXTRACTS, COPIES OF SHARE CERTIFICATES AND D-MAT STATEMENTS ETC AND THE AO HA S FAI;ED TO SHOW THAT THE MATERIAL DOCUMENTS PLACED O N RECORDS BY THE ASSESSEE WERE FALSE, FABRICATED OR F ICTITIOUS , THEN THE TRANSACTIONS OF PURCHASE AND SALE OF SHARE S CAN NOT BE TREATED AS NON GENUINE. WE HAVE ALSO PERUSED OTHER DECISIONS OF THE COORDIN ATE MUMBAI BENCHES WHEREIN UNDER SIMILAR FACTS THE ISSU E HAS BEEN DECIDED IN FAVOUR OF THE ASSESSEE. 12. WE DO NOT FIND MERIT IN THE ARGUMENT OF THE LD. D.R. AS THE DECISIONS RELIED BY THE LD. D.R. CLEARLY ARE DISTIN GUISHABLE ON FACTS. IN VIEW OF THE ABOVE FACTS AND THE RATIO LA ID DOWN AS DISCUSSED ABOVE, WE ARE INCLINED TO SET ASIDE THE O RDER OF LD. CIT(A) AND DIRECT THE AO TO DELETE THE ADDITION MAD E UNDER SECTION 68 OF THE ACT OF RS.41,48,39,241/-. ITA NO.7124/M/2019 & ITA NO.7581/M/2019 MRS. PALLAVI PANDEY & SHRI RAJENDRA CHATURVEDI 17 13. SINCE WE HAVE DELETED THE ADDITION AS MADE BY T HE AO UNDER SECTION 68 OF THE ACT BY SETTING ASIDE THE OR DER OF LD. CIT(A), THE OTHER ADDITION OF RS.2,07,41,962/- AS M ADE BY THE AO TOWARDS COMMISSION PAID ON THE ACCOMMODATION ENT RY IS A CONSEQUENTIAL ONE AND IS ALSO DELETED. ACCORDINGLY, GROUND NOS.2 TO 7 ARE ALLOWED. THE APPEAL OF THE ASSESSEE IS PARTLY ALLOWED. ITA NO.7124/M/2019 14. THE ISSUE INVOLVED IN THE PRESENT APPEAL IS IDE NTICAL TO THE ONE AS STATED ABOVE IN ITA NO.7581/M/2019 FOR A.Y. 2013-14. THEREFORE, OUR FINDING IN ITA NO.7581/M/2019 FOR A. Y. 2013-14, MUTATIS MUTANDIS WOULD APPLY TO THIS APPEAL AS WELL . ACCORDINGLY THE APPEAL OF THE ASSESSEE IS PARTLY AL LOWED. 15. IN THE RESULT THE APPEALS HEREINABOVE ARE PARTL Y ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 23.12.2020. SD/- SD/- ( AMARJIT SINGH) (RAJESH KUMAR) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI, DATED: .12.2020. * KISHORE, SR. P.S. COPY TO: THE APPELLANT THE RESPONDENT THE CIT, CONCERNED, MUMBAI THE CIT (A) CONCERNED, MUMBAI THE DR CONCERNED BENCH //TRUE COPY// BY ORDER DY/ASS TT. REGISTRAR, ITAT, MUMBAI.