MANSI JANA, NEW DELHI V. ITO, WARD- 51(4), NEW DELHI

ITA 7288/DEL/2017

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 9948 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-01-2020
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2014-2015
• Appeal Filed On: 06-12-2017
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: PRATAP SINGH GAUTAM
• Assessee Lawyers: BL GUPTA
• Keywords: Question of law
• Section: 6

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL, DELHI SMC BENCH, NEW DELHI BEFORE SHRI H.S. SIDHU, JUDICIAL MEMBER ITA NO. 7288/DEL/2017 [ASSESSMENT YEAR: 2014-15] SMT. MANSI JANA, VS. ITO, WARD-51(4), 4/5182, KRISHAN NAGAR, NEW DELHI KAROL BAGH, DELHI 110 005 (PAN: ALPPJ5474R) [APPELLANT] [RESPONDENT] ASSESSEE BY: SH. B.L. GUPTA, ADV. REVENUE BY : SH. PRATAP SINGH GAUTAM, SR . DR. ORDER THIS APPEAL BY THE ASSESSEE IS PREFERRED AGAINST TH E ORDER OF THE LD. COMMISSIONER OF INCOME TAX [APPEALS]-17, NEW DELHI DATED 25.09.2017 PERTAINING TO ASSESSMENT YEAR 2014-15. THE ASSESSEE HAS RAISED AS MANY AS 08 GROUNDS OF APPEAL. THE MAIN GROUND IN THIS A PPEAL IS RELATING TO THE ADDITION OF RS. 35,72,234/- MADE BY THE AO U/S. 6 8/69 OF THE INCOME TAX ACT, 1961 (IN SHORT ACT) AND CLAIMING THE EXE MPTION U/S. 10(38) OF THE ACT. 2. AT THE TIME OF HEARING, LD. DR STATED THAT THE I SSUE REGARDING THE SHARES OF M/S KAPPAC PHARMA LTD. HAS BEEN ADJUDICAT ED AND DECIDED BY THE ITAT, DELHI BENCHES IN THE CASE OF UDIT KALRA V S. ITO DECIDED IN ITA NO. 6717/DEL/2017 ON 08.1.2019 IN FAVOUR OF THE REV ENUE. HE FURTHER STATED THAT THE ORDER OF THE ITAT, DELHI BENCHES IN THE CASE OF UDIT KALRA VS. ITO (SUPRA) HAS BEEN UPHELD BY THE HONBLE DELH I HIGH COURT IN ITA NO. 220/2019 & CM NO. 10774/2019 VIDE ORDER DATED 0 8.3.2019. HE HAS ALSO FILED THE COPY OF THE ORDER DATED 8.3.2019 PAS SED BY THE HONBLE DELHI HIGH COURT AND REQUESTED THAT THE APPEAL OF T HE ASSESSEE MAY BE DISMISSED. 2 3. LD. COUNSEL FOR THE ASSESSEE STATED THAT THE ADD ITION OF RS. 35,72,354/- WAS CONFIRMED WITHOUT APPRECIATING THE FACTS OF THE CASE, PROVISIONS OF LAW AND THE SUBMISSIONS OF THE ASSESS EE. IT WAS FURTHER SUBMITTED THAT LD. CIT(A) HAS ERRED BY STATING THAT THE ASSESSEE HAS FAILED TO DISCHARGE HIS ONUS TO PRODUCE LEGALLY ACC EPTABLE EVIDENCES OF GENUINENESS OF TRANSACTIONS AND ALSO ERRED IN STAT ING THAT SO CALLED PURCHASE OF SHARES ARE IS A FABRICATED TRANSACTION WITHOUT ANY EVIDENCE , PROOF, EXAMINATION AND VERIFICATION. IT WAS FURTH ER SUBMITTED THAT LD. CIT(A) ALSO ERRED IN OBSERVING THAT THE ENTIRE TRAN SACTIONS ARE AGAINST HUMAN PROBABILITY AND THERE IS ENOUGH MATERIAL TO RAISE STRONG SUSPICION TO QUESTION THE AUTHENTICITY OF THE TRANSACTION AND REJECT THE PAPER TRAIL CREATED BY THE ASSESSEE. IN VIEW OF ABOVE, HE REQUE STED TO DELETE THE ADDITION IN DISPUTE AND APPEAL OF THE ASSESSEE MAY BE ALLOWED. 4. I HAVE HEARD BOTH THE PARTIES AND PERUSED THE OR DERS PASSED BY THE REVENUE AUTHORITIES INCLUDING THE ITAT ORDER DATED 8.1.2019 PASSED IN THE CASE OF UDIT KALRA VS. ITO DECIDED IN ITA NO. 6717/ DEL/2017 IN FAVOUR OF THE REVENUE, WHICH HAS BEEN UPHELD BY THE HONBLE D ELHI HIGH COURT IN THE CASE OF UDIT KALRA VS. ITO IN ITA NO. 220/2019 & CM NO. 10774/2019 VIDE ORDER DATED 08.3.2019. AFTER GOING THROUGH TH E DOCUMENTARY EVIDENCES FILED BY BOTH THE PARTIES, I AM OF THE C ONSIDERED VIEW THAT THE SHARES OF M/S KAPPAC PHARMA LTD. AS HELD BY THE ASS ESSEE IN THE PRESENT CASE, THE GENUINENESS OF THE SAME HAS ALREADY BEEN EXAMINED BY THE ITAT DELHI BENCHES IN THE CASE OF UDIT KALRA (SUPRA ) AND FIND THAT M/S KAPPAC PHARMA LTD. HAS BEEN DE-LISTED FROM THE STOC K EXCHANGE AND IS SUSPICIOUS AND WAS DENIED THE EXEMPTION U/S. 10(38) OF THE I.T. ACT, 1961. FOR THE SAKE OF CONVENIENCE, THE RELEVANT POR TION OF THE JUDGMENT OF THE HONBLE HIGH COURT OF DELHI DECIDED IN THE C ASE OF UDIT KALRA VS. ITO (SUPRA) IS REPRODUCED AS UNDER:- 'THE ASSESSEE IS AGGRIEVED BY THE CONCURRENT FINDIN GS OF THE TAX AUTHORITIES - INCLUDING THE LOWER APPELLATE AUTHORITIES REJECTING ITS CLAIM FOR A LONG TERM CAP ITAL 3 GAIN REPORTED BY IT, TO THE TUNE OF RS.13,33,956/- AND RS.14,34,501/- IN RESPECT OF 4,000 SHARES OF M/S KAPPAC PHARMA LTD. THE ASSESSEE HELD THOSE SHARES F OR APPROXIMATELY 19 MONTHS; THE ACQUISITION PRICE WAS RS.12/- PER SHARE WHEREAS THE MARKET PRICE OF THE SHARES AT THE TIME OF THEIR SALE, WAS RS.720/-. IT IS CONTENDED THAT THE ASSESSEE WAS NOT GRANTED FAIR OPPORTUNITY. MR. RAJESH MAHNA, LEARNED COUNSEL APPEARING FOR THE ASSESSEE RELIED UPON THE ORDERS O F THE CO-ORDINATE BENCH OF THE TRIBUNAL, IN RESPECT OF TH E SAME COMPANY I.E. M/S KAPPAC PHARMA LTD., AND POINTED OUT THAT THE TAX AUTHORITY'S APPROACH IN TH IS CASE WAS ENTIRELY ERRONEOUS AND INCONSISTENT. THE M AIN THRUST OF THE ASSESSEE'S ARGUMENT IS THAT HE WAS DE NIED THE RIGHT TO CROSS-EXAMINATION OF THE INDIVIDUALS W HOSE STATEMENTS LED TO THE INQUIRIES AND ULTIMATE DISALLOWANCE OF THE LONG TERM CAPITAL GAIN CLAIM IN THE RETURNS WHICH ARE THE SUBJECT MATTER OF THE PRESENT APPEAL. THIS COURT HAS CONSIDERED THE SUBMISSIONS O F THE PARTIES. ASIDE FROM THE FACT THAT THE FINDINGS IN T HIS CASE ARE ENTIRELY CONCURRENT - AO., CIT(A) AND THE I TAT HAVE ALL CONSISTENTLY RENDERED ADVERSE FINDINGS - W HAT IS INTRIGUING IS THAT THE COMPANY (MIS KAPPAC PHARMA L TD.) HAD MEAGRE RESOURCES AND IN FACT REPORTED CONSISTEN T LOSSES. IN THESE CIRCUMSTANCES, THE ASTRONOMICAL GR OWTH OF THE VALUE OF COMPANY'S SHARES NATURALLY EXCITED THE SUSPICIONS OF THE REVENUE. THE COMPANY WAS EVEN DIRECTED TO BE DELISTED FROM THE STOCK EXCHANGE. HA VING REGARD TO THESE CIRCUMSTANCES AND PRINCIPALLY ON TH E GROUND THAT THE FINDINGS ARE ENTIRELY OF FACT, THIS COURT IS OF THE OPINION THAT NO SUBSTANTIAL QUESTION OF LAW ARISES 4 IN THE PRESENT APPEAL. THIS APPEAL IS ACCORDINGLY DISMISSED.' 4.1 AFTER GOING THROUGH THE FACTS AND CIRCUMSTANCES OF THE PRESENT CASE AND THE JUDGMENT OF THE HONBLE DELHI HIGH COURT I N THE CASE OF UDIT KALRA VS. ITO (SUPRA), I HAVE NO OTHER OPTION EXCEP T TO FOLLOW THE DECISION OF THE HONBLE DELHI HIGH COURT, BECAUSE NO OTHER CONTRARY JUDGMENT HAS BEEN PRODUCED BY THE LD. COUNSEL FOR THE ASSESEE. ACCORDINGLY, FOLLOWING THE AFORESAID PRECEDENT, I UPHOLD THE ORDER OF THE LD. CIT(A) AND DECIDE THE ISSUE IN DISPUTE AGAINST THE ASSESSEE. 5. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS DISMISSED. THE ORDER PRONOUNCED ON 03.01.2020. SD/- [H.S. SIDHU] JUDICIAL MEMBER DATED: 03-01-2020 SRB COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) ASST. REGISTRAR, 5. DR ITAT, NEW DELHI