RAMESH BABULAL VARDHAN, MUMBAI V. DY CIT CC 2 (2), MUMBAU

ITA 7662/MUM/2019

• Counselvise Citation: [2020] 110 COUNSELVISE.COM (IT) 9201 (ITAT-MUMBAI)
• Duration Of Justice: 7 month(s) 30 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-08-2020
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: D
• Assessment Year: 2014-2015
• Appeal Filed On: 12-12-2019
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: JAYANT JHAVERI LD; UDOOL RAJ SINGH LD
• Assessee Lawyers: VIMAL PUNAMIYA LD
• Keywords: Income from undisclosed sources; Salary income; Principle of natural justice; Opportunity of cross examination; Earning of tax free income; Tangible material; Corroborative evidences; Third party statement; Accommodation entries; Scheme of amalgamation; Onus to prove; Sham transactions; Capital Gains
• Section: 143(3); 133A; 153A; 201; 143(2); 13; 131; 68; 132

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH, MUMBAI , , BEFORE HONBLE SHRI MAHAVIR SINGH, VP AND HONBLE SHRI MANOJ KUMAR AGGARWAL, AM 1. ./ I.T.A. NO.7648/MUM/2019 ( / ASSESSMENT YEAR : 2014-15 ) DIPESH RAMESH VARDHAN 101, COMMERCE HOUSE 140 NAGINDAS MASTER ROAD FORT, MUMBAI. / VS. D CIT - CENTRAL CIRCLE - 2(2) ROOM NO.806, 8TH FLOOR PRATISHTHA BHAVAN M.K. ROAD, MUMBAI- 400 020. &'! ./ ./PAN/GIR NO. ADNPV-5835-V ( ') /APPELLANT ) : ( *+') / RESPONDENT ) & 2. ! ./ I.T.A. NO.7662/MUM/2019 ( / ASSESSMENT YEAR : 2014-15 ) RAMESH BA BULAL VARDHAN 101, COMMERCE HOUSE 140 NAGINDAS MASTER ROAD FORT, MUMBAI. / VS. D CIT - CENTRAL CIRCLE - 2(2) ROOM NO.806, 8TH FLOOR PRATISHTHA BHAVAN M.K. ROAD, MUMBAI- 400 020. &'! ./ ./PAN/GIR NO. AAAPV-5350-N ( ') /APPELLANT ) : ( *+') / RESPONDENT ) & 3. ! ./ I.T.A. NO.7651/MUM/2019 ( / ASSESSMENT YEAR : 2014-15 ) MANJU RAMESH VARDHAN 101, COMMERCE HOUSE 140 NAGINDAS MASTER ROAD FORT, MUMBAI. / VS. D CIT - CENTRAL CIRCLE - 2(2) ROOM NO.806, 8TH FLOOR PRATISHTHA BHAVAN M.K. ROAD, MUMBAI- 400 020. &'! ./ ./PAN/GIR NO. AAGPV-0698-H ( ') /APPELLANT ) : ( *+') / RESPONDENT ) & 4. ! ./ I.T.A. NO.7650/MUM/2019 ( / ASSESSMENT YEAR : 2014-15 ) VISHAL RAMESH VARDHAN 101, COMMERCE HOUSE 140 NAGINDAS MASTER ROAD FORT, MUMBAI. / VS. D CIT - CENTRAL CIRCLE - 2(2) ROOM NO.806, 8TH FLOOR PRATISHTHA BHAVAN M.K. ROAD, MUMBAI- 400 020. &'! ./ ./PAN/GIR NO. AFKPV-4975-J 2 ( ') /APPELLANT ) : ( *+') / RESPONDENT ) & 5. ! ./ I.T.A. NO.7649/MUM/2019 ( / ASSESSMENT YEAR : 2014-15 ) RAJESH BABULAL VARDHAN 101, COMMERCE HOUSE 140 NAGINDAS MASTER ROAD FORT, MUMBAI. / VS. D CIT - CENTRAL CIRCLE - 2(2) ROOM NO.806, 8TH FLOOR PRATISHTHA BHAVAN M.K. ROAD, MUMBAI- 400 020. &'! ./ ./PAN/GIR NO. AAAPV-5351-P ( ') /APPELLANT ) : ( *+') / RESPONDENT ) ASSESSEE BY : SHRI VIMAL PUNAMIYA-LD.AR REVENUE BY : SHRI JAYANT JHAVERI-LD. CIT-DR & SHRI UDOOL RAJ SINGH-LD. SR. DR DATE OF FINAL HEARING : 31/07/2020 DATE OF PRONOUN CEMENT : 11 /08/2020 / O R D E R MANOJ KUMAR AGGARWAL (ACCOUNTANT MEMBER) 1. AFORESAID APPEALS BY 5 DIFFERENT ASSESSEE CONTES T SEPARATE ORDERS OF LEARNED FIRST APPELLATE AUTHORITY. SINCE THE ISS UES WERE IDENTICAL AND STEM FROM SAME SET OF FACTS, THE APPEALS WERE HEARD TOGETHER AND ARE NOW BEING DISPOSED-OFF BY WAY OF THIS CONSOLIDATED ORDER FOR THE SAKE OF CONVENIENCE AND BREVITY. IT IS ADMITTED POSITION TH AT ADJUDICATION IN ANY OF THE APPEALS WOULD EQUALLY APPLY TO ALL THE OTHER APPEALS ALSO. 2. WE HAVE CAREFULLY HEARD THE ARGUMENTS ADVANCED B Y BOTH THE REPRESENTATIVES DURING THE COURSE OF HEARING AS WEL L AS DURING CLARIFICATION. WE HAVE PERUSED RELEVANT MATERIAL ON RECORD INCLUDING THE DOCUMENTS PLACED IN THE PAPER-BOOK. WE HAVE ALSO DE LIBERATED ON VARIOUS JUDICIAL PRONOUNCEMENTS AS CITED BY BOTH TH E REPRESENTATIVES DURING THE COURSE OF HEARING. THE WRITTEN SUBMISSIO NS HAVE DULY BEEN CONSIDERED. OUR ADJUDICATION TO THE CAPTIONED APPEA LS WOULD BE AS GIVEN 3 IN SUCCEEDING PARAGRAPHS. ITA NO.7648/MUM/2019 OF S HRI DIPESH RAMESH VARDHAN IS TAKEN AS THE LEAD CASE. ITA NO.7648/MUM/2019 FOR A.Y. 2014-15: SHRI DIPESH RAMESH VARDHAN 3.1 THIS APPEAL ASSAILS THE THE ORDER OF LD. COMMIS SIONER OF INCOME- TAX (APPEALS)-48, MUMBAI, [IN SHORT REFERRED TO AS CIT(A)], DATED 31/10/2019 ON FOLLOWING GROUNDS OF APPEAL. 1. ADDITION AS UNACCOUNTED/UNEXPLAINED INCOME OF RS.2,99,76,550/- BY TREATING THE LONG TERM CAPITAL GAIN AS MANIPULATED TRANSACTI ON AND FURTHER ADDING 2% THEREON AS COMMISSION BY JUST RELYING UPON THIRD PA RTY STATEMENT WITHOUT ESTABLISHING ANY CONNECTION OF THE APPELLANT WITH T HE SAID THIRD PARTY AND COMPLETELY DISREGARDING THE DIRECT DOCUMENTARY EVIDENCES SUBMI TTED BY THE APPELLANT AND EVEN NO INCRIMINATING DOCUMENTS/MATERIALS WERE FOUND DUR ING THE COURSE OF SEARCH ACTION/PROCEEDINGS. (A) ON THE FACTS AND THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LEARNED ASSESSING OFFICER HAS ERRED IN LAW AND FACTS IN TRE ATING THE LONG-TERM CAPITAL GAIN AS MANIPULATED TRANSACTIONS AND FURTHER ADDING 2% T HEREON AS COMMISSION EXPENSES AND ADDED AN AMOUNT OF RS. 2,99,76,550/- T O TOTAL INCOME UNDER SECTION 68 OF THE INCOME TAX ACT 1961 EVEN THOUGH NO INCRIM INATING DOCUMENTS AND/OR MATERIAL OF ALLEGED CASH PAID TO THE ALLEGED ACCOMM ODATION ENTRY PROVIDER/SHARE OPERATOR WERE FOUND DURING THE COURSE OF SEARCH ACT ION/PROCEEDINGS. THE LEARNED ASSESSING OFFICER HAS JUST ACTED MECHANICALLY RELYI NG UPON THIRD PARTY STATEMENT AND REFERENCE MADE BY THE INVESTIGATION WING WITHOUT TA KING COGNIZANCE OF AND COMPLETELY DISREGARDING THE DIRECT DOCUMENTARY EVID ENCES SUBMITTED BY THE APPELLANT DURING THE ASSESSMENT PROCEEDING PERTAINI NG WHICH WERE SUFFICIENT ENOUGH TO ESTABLISH THE GENUINENESS OF THE TRANSACT IONS. THE LEARNED ASSESSING OFFICER HAS ERRED IN RELYING UPON THE IRRELEVANT MA TERIAL SEIZED IN THE CASE OF SOME PERSON NAMED AS MR. VIPUL BHATT AND HIS STATEMENT W ITH WHOM THE APPELLANT HAS NO CONNECTION WHATSOEVER AND THE LEARNED ASSESSING OFF ICER DID NOT ESTABLISH ANY CONNECTION OF THE APPELLANT WITH THE SAID MR. VIPUL BHATT. THE LEARNED ASSESSING OFFICER REJECTED THE CLAIM OF THE APPELLANT JUST BE CAUSE THE APPELLANT DID NOT PRODUCE THE PARTY I.E. THE COMPANY WITHOUT APPRECIA TING THAT THE APPELLANT IS NOT OBLIGED UNDER ANY LAW TO PRODUCE ANY OF THE COMPANY AS THE SHARES WERE SOLD AT THE ONLINE PLATFORM OF THE STOCK EXCHANGE AND NOT T O THE COMPANY. (B)THE LEARNED CIT (APPEAL) HAS ERRED IN UPHOLDING THE ACTION OF THE AO IN MAKING ADDITION OF RS. 2,99,76,550/- UNDER SECTION 68 OF T HE INCOME TAX ACT, BEING THE LONG TERM CAPITAL GAIN AND FURTHER ADDING 2% THEREON AS COMMISSION EXPENSES ON THE SALE OF SHARES OF A LISTED COMPANY THROUGH RECOGNIZ ED STOCK EXCHANGE EVEN WHEN THE IDENTITY AND NATURE OF THE SOURCE OF THE SAID C APITAL GAIN WERE EXPLAINED AND PROVED. (C) THE LEARNED ASSESSING OFFICER/CIT (APPEAL) ERRE D IN LAW AND FACTS IN PASSING THE ASSESSMENT ORDERS SOLELY ON THE BASIS OF ASSUMPTION , PRESUMPTIONS, SURMISES AND CONJECTURES WITHOUT ANY COGENT MATERIAL OR EVIDENCE . THE REASON GIVEN ARE WRONG, 4 CONTRARY TO THE FACTS OF THE CASE AND AGAINST THE P ROVISIONS OF LAW, HENCE IT IS ILLEGAL AND CONTRARY TO THE PRINCIPAL OF NATURAL JUSTICE. IN VIEW OF THE FORGOING LAWS AND FACTS, THE ADDITIO N MADE IS UNWARRANTED AND NOT JUSTIFIED AND IT IS THEREFORE, PRAYED THAT THE SAME BE DELETED. AS EVIDENT, THE ASSESSEE IS AGGRIEVED BY CONFIRMATI ON OF CERTAIN ADDITIONS AS UNEXPLAINED / UNACCOUNTED INCOME AND A LSO BY CONFIRMATION OF ESTIMATED ADDITIONS OF COMMISSION AGAINST THESE TRANSACTIONS. TO RESOLVE THE CONTROVERSY, IT WOULD BE IMPERATIVE TO DELVE INTO CORRECT FACTUAL MATRIX OF THE CASE AS BROUGHT ON RECORD BY LD. AO IN QUANTUM ASSESSMENT ORDER AND AS ADJUDICATED BY LD. CIT(A) I N THE IMPUGNED ORDER. 3.2 BRIEFLY STATED THE ASSESSEE BEING RESIDENT INDI VIDUAL IS STATED TO BE DIRECTOR AND PARTNER IN THE VARDHMAN GROUP OF COMPANIES AND FIRMS WHICH CARRIES ON THE BUSINESS AS BUILDERS & DEVELOP ERS, GRANTING OF LOANS & ADVANCES AND INVESTMENT ACTIVITIES. THE ASS ESSEE EARNED SALARY INCOME IN THE FORM OF DIRECTORS REMUNERATIO N FROM GROUP COMPANIES AND INTEREST INCOME ON LOANS DURING THE Y EAR WHICH HAS DULY BEEN REFLECTED IN THE RETURN OF INCOME. THE ASSESSE E ALSO EARNED EXEMPT INCOME IN THE FORM OF LONG-TERM CAPITAL GAIN S (LTCG), SHARE OF PROFIT FROM PARTNERSHIP FIRMS, INTEREST ON PPF & DI VIDENDS ETC. THE SOLE SUBJECT MATTER OF THE APPEAL IS CERTAIN ADDITION ON ACCOUNT OF LONG-TERM CAPITAL GAINS EARNED BY THE ASSESSEE DURING THE YEA R. THE ASSESSEE REFLECTED LTCG OF RS.293.88 LACS ON CERTAIN SHARES TRANSACTIONS WHICH WERE CLAIMED TO BE EXEMPT U/S 10(38). THE LD. AO AS WELL AS LD. FIRST APPELLATE AUTHORITY HAS DENIED THE SAME AND HENCE, THIS APPEAL. 3.3 THE RECORD WOULD SHOW THAT AN ASSESSMENT WAS FR AMED FOR YEAR UNDER CONSIDERATION U/S 143(3) R.W.S. 153A OF THE A CT ON 21/12/2016 WHEREIN THE INCOME OF THE ASSESSEE WAS DETERMINED A T RS.303.50 LACS 5 AFTER CERTAIN ADDITIONS OF UNEXPLAINED INCOME AS AG AINST RETURNED INCOME OF RS.3.74 LACS FILED BY THE ASSESSEE ON 25/09/2014 . THE LTCG EARNED BY THE ASSESSEE WAS TREATED AS ITS UNACCOUNTED INCO ME AND LD.AO HAD ESTIMATED COMMISSION INCOME AGAINST THESE TRANSACTI ONS @2%. 3.4 THE SAID ASSESSMENT STEM FROM SEARCH OPERATIONS U/S 132 AS CARRIED OUT BY THE DEPARTMENT AT VARIOUS RESIDENTIA L AND BUSINESS PREMISES OF ASSESSEE GROUP ON 05/11/2014. DURING TH E COURSE OF SEARCH AT THE RESIDENCE OF THE ASSESSEE, EXCESS JEWELLERY WORTH RS.3.30 LACS WAS FOUND WHICH WAS OFFERED TO TAX IN STATEMENT U/S . 132(4). CONSEQUENTLY, NOTICES U/S 153A & 143(2) WERE ISSUED AS PER DUE PROCESS OF LAW. 3.5 DURING ASSESSMENT PROCEEDINGS, IT TRANSPIRED TH AT VARIOUS FAMILY MEMBERS OF THE GROUP REFLECTED LTCG AGGREGATING IN ALL TO RS.3235.98 LACS AND CLAIMED THE SAME TO BE EXEMPT U/S 10(38). THE ASSESSEE-WISE DETAIL, IN THIS RESPECT HAS BEEN TABULATED IN PARA 4.1 OF THE QUANTUM ASSESSMENT ORDER. ACCORDINGLY, THE ASSESSEE WAS ASK ED TO EXPLAIN THE GENUINENESS OF THE AFORESAID LTCG. THE AMOUNT OF LT CG REFLECTED BY THE ASSESSEE WAS RS.293.88 LACS. 3.6 IT TRANSPIRED THAT THE ASSESSEE MADE INVESTMENT IN THE SHAPE OF 62,500 EQUITY SHARES OF AN ENTITY NAMELY SANTOSHIMA TRADELINK LTD. (STL) DURING THE MONTH OF SEPTEMBER, 2011. THE FACE VALUE OF THE SHARE WAS RS.10/- PER SHARE WITH PREMIUM OF RS.10/- PER S HARE AND ACCORDINGLY, THE ASSESSEE PAID A SUM OF RS.12.50 LA CS TO ACQUIRE THE SAME. THE SHARES WERE DULY ALLOTTED IN DUE COURSE A ND THE SHARES CERTIFICATES WERE RECEIVED IN PHYSICAL FORM AND THE SHARES WERE ULTIMATELY DEMATERIALIZED IN ASSESSEES ACCOUNT DUR ING MARCH, 2012. 6 3.7 MEANWHILE, M/S STL GOT AMALGAMATED WITH ANOTHER ENTITY NAMELY M/S SUNRISE ASIAN LTD. (SAL) PURSUANT TO A SCHEME O F AMALGAMATION U/S 391 TO 394 WHICH WAS DULY APPROVED BY HONBLE BOMBA Y HIGH COURT. AS PER THE SCHEME OF AMALGAMATION, SHARE SWAP RATIO WA S FIXED AS 1:1 AND ACCORDINGLY, THE SHARES OF STL WERE SWAPPED WITH TH E SHARES OF SAL WHICH WERE CREDITED IN ASSESSEES DEMAT ACCOUNT DUR ING THE MONTH OF JUNE, 2013. M/S SAL WAS A PUBLIC LIMITED COMPANY AN D ITS SHARES WERE LISTED ON BOMBAY STOCK EXCHANGE AS GROUP A SHARES SIGNIFYING THAT THE SHARES WERE HIGHLY TRADED HAVING HIGHEST DEGREE OF LIQUIDITY. 3.8 THE ASSESSEE SOLD THESE SHARES THROUGH ONLINE P LATFORM (BOLT) PROVIDED BY RECOGNIZED STOCK EXCHANGE AND DELIVERED THE SHARES IN DEMAT FORM TO THE CLEARING HOUSE AND RECEIVED SALE CONSIDERATION THROUGH ITS STOCK-BROKER IN THE MONTH OF MARCH, 201 4. THE SALE CONSIDERATION WAS RECEIVED THROUGH BANKING CHANNELS . SINCE THE INVESTMENT WAS HELD FOR MORE THAN 1 YEAR AND THE SA LE TRANSACTIONS WERE UNDERTAKEN THROUGH RECOGNISED STOCK EXCHANGE ON WHI CH SECURITIES TRANSACTIONS TAX (STT) WAS PAID, THE ASSESSEE APPAR ENTLY FULFILLED THE CONDITIONS LAID DOWN IN SEC. 10(38) AND ACCORDINGLY CLAIMED EXEMPTION OF THE GAIN. THE LTCG EARNED ON THESE TRANSACTIONS WAS WORKED OUT TO BE RS.293.88 LACS. 3.9 HOWEVER, TO VERIFY THE TRANSACTIONS, SUMMONS U/ S 131 WERE ISSUED AT THE ADDRESS OF M/S SAL WHICH REMAINED UN-RESPOND ED TO. IT TRANSPIRED THAT A SEARCH ACTION WAS CONDUCTED AT VARIOUS PLACE S OF ONE SHRI VIPUL BHAT ON 05/02/2016 WHEREIN IT WAS REVEALED THAT SHR I VIPUL BHAT WAS CONTROLLING M/S SAL AND WAS ENGAGED IN RIGGING THE SHARE PRICE OF M/S SAL. BASED ON OUTCOME OF SEARCH PROCEEDINGS, AN OPI NION WAS FORMED 7 THAT M/S SAL WAS MERELY A PAPER COMPANY ENGAGED IN PROVIDING ACCOMMODATION ENTRIES TO VARIOUS BENEFICIARIES. THI S SEARCH WAS SUBSEQUENT TO SEARCH CONDUCTED ON THE ASSESSEE ON 0 5/11/2014. IN THE SAID BACKGROUND, THE TRANSACTIONS CARRIED OUT BY TH E ASSESSEE WAS SUBJECTED TO SCRUTINY DURING ASSESSMENT PROCEEDINGS . 3.10 IN DEFENCE OF GENUINENESS OF STATED TRANSACTIO NS, THE ASSESSEE FURNISHED COPIES OF PURCHASE AND SALES CONTRACT NOT ES. THE COPIES OF FINANCIAL STATEMENTS OF M/S STL FOR FYS 2009-10 & 2 010-11, ON THE BASIS OF WHICH THE DECISION TO MAKE THE INVESTMENT WAS TA KEN BY THE ASSESSEE, WAS ALSO PLACED ON RECORD. THE ASSESSEE A LSO SUBMITTED MONTH-WISE DATA OF TRADING VOLUME AND PRICE RANGE O F SHARES OF M/S SAL FOR MORE THAN 2 YEARS I.E. FROM THE MONTH OF JAN 20 13 TO JULY 2015. DURING THE AFORESAID PERIOD, THE PRICE RANGE WAS CO NTINUOUSLY SHOWN TO BE IN THE RANGE OF RS.360-600 PER SHARE AND THE TRA DING VOLUMES WERE SHOWN TO BE IN THE RANGE OF 5 LACS TO 25 LACS SHARE S PER MONTH. THE PRICE RANGE WAS STATED TO BE IN THE SAME RANGE FOR 15 MONTHS AFTER THE PERIOD OF SALE OF SHARES BY THE ASSESSEE. THEREFORE , THE ALLEGATIONS OF RIGGING OR MANIPULATION OF SHARES WERE REFUTED. THE ASSESSEE DENIED HAVING KNOWN SHRI VIPUL BHAT AND SUBMITTED THAT IT HAD NO PRIVY OF CONTRACT WITH THE BUYERS OF THE SHARES SINCE THE SH ARES WERE SOLD THROUGH RECOGNISED STOCK EXCHANGE IN ONLINE MODE. I N THE ABOVE BACKGROUND, THE ASSESSEE DENIED THE ALLEGATIONS OF LD. AO QUA RIGGING / MANIPULATION OF SHARE PRICES OF M/S SAL. 3.11 HOWEVER, IT WAS NOTED THAT THERE WAS SURVEY AC TION U/S 133A ON 04/02/2016 IN CASE OF M/S SAL. DURING SURVEY, THE S TATEMENT OF SHRI KALPESH MANAHAR JANI (DIRECTOR OF M/S SAL) WAS RECO RDED WHEREIN THE 8 SAID PERSON DENIED HAVING ANY LINK WITH M/S SAL BUT SUBMITTED THAT SHRI VIPUL BHAT APPOINTED HIM AS A DIRECTOR OF M/S SAL. THE SURVEY ON THE PREMISES OF M/S SAL REVEALED THAT GIVEN ADDRESS WAS DUMMY OFFICE AND IT WAS A PAPER COMPANY. IT WAS ALSO NOTED THAT VARIOUS ENTITIES CONTROLLED BY SHRI VIPUL BHAT ACTED AS EXIT PROVIDERS TO THE BENEFICIARIES OF THE SCRIP S. TWO OF THESE ENTITIES WERE M/S SAMPADA CHEMICALS LTD. & M/S SHIPRA FABRIC S PVT. LTD. THE DIRECTOR OF M/S SAMPADA CHEMICALS LTD. NAMELY S HRI KAUSHIK BALUBHAI MADHWANI, DURING SURVEY PROCEEDING, DENIED HAVING ANY LINK WITH ENTITY M/S SAMPADA CHEMICALS LTD. SIMILARLY, T HE DIRECTOR OF M/S SHIPRA FABRICS PVT. LTD. DENIED HAVING ANY KNOWLEDG E ABOUT THE SAID ENTITY AND SUBMITTED THAT THIS ENTITY WAS BEING OPE RATED BY SHRI VIPUL VIDUR BHATT. SHRI VIPUL VIDUR BHAT ACCEPTED UNDER OATH THAT HE W AS INVOLVED IN PROVIDING ACCOMMODATION ENTRIES AGAINST COMMISSION. HE ADMITTED TO HAVE MANIPULATED THE SHARE PRICES OF M/S SAL FOR PR OVIDING ACCOMMODATION ENTRIES OF LTCG. 3.12 THE SURVEY ACTION LED TO ISSUANCE OF SEARCH WA RRANT U/S 132 ON 05/02/2016 IN THE NAME OF SHRI VIPUL VIDUR BHAT AND HIS VARIOUS ENTITIES INCLUDING M/S SAL. DURING SEARCH OPERATIONS, STATEM ENT OF SHRI VIPUL VIDUR BHAT WAS RECORDED U/S 132(4) WHEREIN HE ADMIT TED TO HAVE INDULGED IN PROVIDING ACCOMMODATION ENTRIES TO BENE FICIARIES AGAINST COMMISSION. 3.13 TO VERIFY THE GENUINENESS OF THE TRANSACTIONS OF VARIOUS ASSESSEE OF VARDHAN GROUP, TRADING DATA WAS COLLECTED FROM S TOCK EXCHANGE. THE DETAILS OF BUYER WHO PURCHASED THE SHARES OF VARDHA N GROUP WERE 9 TABULATED IN PARA 4.5 OF THE QUANTUM ASSESSMENT ORD ER. FROM THE SAID ANALYSIS, A CONCLUSION WAS DRAWN THAT THE SHARES WE RE PURCHASED BY VARIOUS CONCERNS OF SHRI VIPUL BHAT ONLY. IT WAS AL SO NOTED THAT THERE WAS CIRCULAR TRADING WITHIN THE GROUP ENTITIES OF SHRI VIPUL BHAT WHICH HELPED IN MANIPULATING THE PRICES OF M/S SAL. 3.14 FINALLY, APPLYING THE PRINCIPLE OF HUMAN PROBA BILITY IN TERMS OF DECISION OF HONBLE SUPREME COURT IN SUMATI DAYAL 214 ITR 801 , THESE TRANSACTIONS WERE TERMED AS MANIPULATED TRANSACTION DONE BY THE ASSESSEE IN CONNIVANCE WITH SHRI VIPUL BHAT TO EVAD E THE TAXES ON UNACCOUNTED INCOME. IN ORDER TO OBTAIN SUCH TRANSAC TIONS, A COMMISSION WOULD USUALLY BE PAID. THE SAME WAS ESTIMATED @2%. THE ACTION OF LD. AO RESULTED INTO AN ADDITION OF RS.299.76 LACS IN T HE HANDS OF THE ASSESSEE. 3.15 IN PARA-4 OF THE QUANTUM ASSESSMENT ORDER, IT WAS NOTED THAT THE SEARCH WAS CONDUCTED ON THE ASSESSEE ON 05/11/2014. THE RETURN OF INCOME FOR AY 2014-15 WAS ALREADY FILED BY THAT DAT E. HOWEVER, THE TIME LIMIT FOR ISSUANCE OF NOTICE U/S 143(2) HAD NOT EXP IRED. AS A MATTER OF FACT, THE RETURN OF INCOME FOR AY 2014-15 WAS SELEC TED FOR SCRUTINY THROUGH CASS FOR THE PURPOSE OF EXAMINATION OF EXEM PT LTCG. THEREFORE, THE ASSESSEES CONTENTION THAT THERE WAS NO INCRIMINATING MATERIAL FOUND DURING THE COURSE OF SEARCH OPERATIO NS AND THEREFORE NO ADDITION BASED ON MATERIAL OTHER THAN INCRIMINATING MATERIAL WOULD BE JUSTIFIED, COULD NOT BE ACCEPTED. ACCORDINGLY, THE ASSESSMENT WAS FRAMED AGAINST THE ASSESSEE. 4.1 BEFORE LD. CIT(A), THE ASSESSEE ASSAILED THE AD DITION BY WAY OF ELABORATE WRITTEN SUBMISSIONS WHICH HAVE ALREADY BE EN EXTRACTED IN 10 PARA-4 OF THE IMPUGNED ORDER. THE ASSESSEE VEHEMENT LY CONTROVERTED THE FINDINGS OF LD. AO BY SUBMITTING THAT IN THE LI ST OF PURCHASE OF SHARES, AS TABULATED BY LD. AO, THERE WERE INDEPENDENT BUYE RS TOO. THE ASSESSEE DENIED HAVING KNOWN SHRI VIPUL BHAT AND DE NIED HAVING ENTERED INTO ANY TRANSACTIONS WITH ANY OF HIS ENTIT IES. IT WAS REITERATED THAT THE SHARES WERE SOLD AT THE ONLINE PLATFORM OF THE STOCK EXCHANGE THROUGH SHARE BROKER. THE ASSESSEE OR THE SHARE BRO KER WOULD HAVE NO CONTROL OVER THE BIDDER / BUYERS OF THE SHARES IN T HE ONLINE PLATFORM. THE ASSESSEE SUBMITTED THAT IT HAD NO DEALING OR CONTRO L OVER M/S SAL AND THEREFORE, HE WAS NOT OBLIGATED UNDER LAW TO PRODUC E ANY SUCH PARTY. IN FACT, IT WAS ONUS OF LD. AO TO PROVIDE CROSS-EXAMIN ATION OF THE SAID PARTY WHOM HE WAS TRYING TO LINK ASSESSEE WITH. ON THE OT HER HAND, THE ASSESSEE DISCHARGED HIS ONUS TO PROVE THE GENUINENE SS OF THE TRANSACTIONS BY PROVIDING ALL THE RELEVANT DIRECT D OCUMENTARY EVIDENCES. THE LD. AO HEAVILY RELIED UPON THE FINDINGS OF INVE STIGATION WING WITHOUT CARRYING OUT ANY INDEPENDENT INVESTIGATION OF HIS O WN. NOTHING WAS BROUGHT ON RECORD WHICH WOULD ESTABLISH THAT THE AS SESSEE WAS BENEFICIARY OF ALLEGED ACCOMMODATION ENTRIES PROVID ED BY THE SO-CALLED SHRI VIPUL BHAT. NO CORROBORATIVE EVIDENCES TO SUPP ORT THE FINDINGS OF LD. AO WERE BROUGHT ON RECORD. THE DOCUMENTARY EVIDENCE S SUBMITTED BY THE ASSESSEE WERE NEITHER VERIFIED NOR EXAMINED. FU RTHER, NO CONTRARY AND CONCLUSIVE EVIDENCES WERE BROUGHT ON RECORD TO DISPUTE THE SAID DOCUMENTARY EVIDENCES FURNISHED BY THE ASSESSEE. 4.2 THE ATTENTION WAS DRAWN TO THE FACT THAT SALE T RANSACTIONS TOOK PLACE THROUGH RECOGNIZED STOCK EXCHANGE AND STATUTO RY SECURITIES TRANSACTION TAX (STT) WAS PAID ON SALE TRANSACTIONS . IN THE ONLINE 11 PLATFORM, THE IDENTITY OF THE SELLER AS WELL AS PUR CHASER WOULD NOT BE KNOWN. THE SHARES WERE DELIVERED IN DEMAT FORM THOU GH CLEARING MECHANISM OF THE STOCK EXCHANGE. THEREFORE, UNLESS ANY LINK IS ESTABLISHED, THE ASSESSEE COULD NOT BE HELD TO BE P ART OF THE GROUP INDULGING INTO RIGGING SHARES PRICES OF THE SCRIPS. THE SALE PROCEEDS WERE REALISED THROUGH BANKING CHANNELS. THERE WAS NO EVI DENCE OF ANY CASH EXCHANGE. THE FINDINGS AS WELL AS CONCLUSION OF LD. AO WERE BASED ON MERE SUSPICION, SURMISES AND HEARSAY AS AGAINST SET TLED PROPOSITION OF LAW THAT SUSPICION HOWSOEVER STRONG COULD NOT PARTA KE THE CHARACTER OF LEGAL EVIDENCE. THE ENTIRE CASE OF LD.AO WAS BASED ON MERE PRESUMPTION THAT THE ASSESSEE PLOUGHED BACK ITS OWN UNACCOUNTED MONEY IN THE FORM OF BOGUS LTCG. THE PRESUMPTION N EEDS TO BE CORROBORATED BY SOME EVIDENCE TO ESTABLISH THE SAME . FOR THE SAID PROPOSITION, RELIANCE WAS PLACED ON CATENA OF JUDIC IAL PRONOUNCEMENTS OF HONBLE HIGH COURTS AS WELL TRIBUNAL WHICH HAS ALRE ADY BEEN ENUMERATED IN THE IMPUGNED ORDER. 4.3 THE ASSESSEE ALSO RAISED A PLEA OF VIOLATION OF PRINCIPLE OF NATURAL JUSTICE BY SUBMITTING THAT THE STATEMENT OF SHRI VI PUL BHAT WAS NEVER CONFRONTED TO THE ASSESSEE AND NO OPPORTUNITY TO CR OSS-EXAMINE THE SAID PERSON WAS EVER PROVIDED TO THE ASSESSEE. MORE SO, SHRI VIPUL BHAT DID NOT STATE AS TO HOW HE WAS CONNECTED WITH THE ASSES SEE. IN THE ABSENCE OF ANY SUCH ADMISSION, THE STATEMENT WOULD HAVE NO EVIDENTIARY VALUE. FOR AFORESAID SUBMISSIONS, RELIANCE WAS PLACED, INTER-ALIA, ON THE DECISION OF HONBLE SUPREME COURT IN ANDAMAN TIMER INDUSTRIES LTD. (CIVIL APPEAL NO. 4228 OF 2006) & THE DECISION OF KISHANCHAND CHELLARAM V/S CIT (125 ITR 713). 12 4.4 THE ASSESSEE ALSO RAISED A PLEA THAT IN THE ABS ENCE OF ANY INCRIMINATING MATERIAL FOUND DURING THE COURSE OF S EARCH OPERATIONS, THE ADDITIONS WOULD NOT BE SUSTAINABLE. HOWEVER, THIS P LEA WAS REJECTED BY LD.CIT(A) WHICH HAS ALREADY BEEN ENUMERATED BY US I N PRECEDING PARA 3.15. SIMILAR PLEA HAS BEEN RAISED BEFORE US BY LD. AR. HOWEVER, WE ARE COMPLETELY IN AGREEMENT WITH THE STAND OF LD. CIT(A ) IN THIS REGARD AND THEREFORE, REJECT THIS PLEA. 4.5 THE LD. CIT(A), IN THE BACKGROUND OF JUDICIAL D ECISION ON CIRCUMSTANTIAL SURROUNDING EVIDENCES, NOTED THAT EN TIRE NETWORK OF DOCUMENTS WAS MANIPULATED AND CREATED BY SHRI VIPUL BHAT AND HIS ASSOCIATES WITH THE SOLE PURPOSE OF PROVIDING BOGUS LTCG TO VARIOUS BENEFICIARIES INCLUDING THE ASSESSEE AND HIS FAMILY MEMBERS. THE SAME WOULD BE EVIDENT FROM STATEMENT OF SHRI VIPUL BHAT U/S 132(4) ON 04/02/2016 & 09/02/2016 DURING THE COURSE OF SEARCH PROCEEDINGS. THE RELEVANT PORTION OF THE SAME HAS BEEN EXTRACTED IN THE IMPUGNED ORDER. BASED ON SAID STATEMENT, IT WAS CONCLUDED THAT DIRE CTOR OF M/S SAL WAS A DUMMY DIRECTOR AND SHRI VIPUL BHAT WAS THE ACTUAL CONTROLLER OF SAID ENTITY. THE STEEP RISE IN THE PRICES OF SHARES WERE MANIPULATED AND CONTROLLED / MANAGED BY SHRI VIPUL BHAT AND HIS ASS OCIATES. THE EXIT PROVIDERS TO THE ASSESSEE WERE MANIPULATED AND CONT ROLLED BY SHRI VIPUL BHAT AND HIS ASSOCIATES. THE STATEMENT OF CONCERNED PERSONS OF EXIT PROVIDER ENTITIES WAS ALSO NOTED IN PARA-7 OF THE I MPUGNED ORDER WHEREUPON A CONCLUSION WAS DRAWN THAT THE PERSONS C ONTROLLING THESE ENTITIES WERE INVARIABLY PERSONS OF VERY SMALL MEAN S. THEIR IDENTITY WAS USED BY SHRI VIPUL BHAT TO CREATE BOGUS COMPANIES. THESE PERSONS WERE NOT AWARE ABOUT THE SHARE TRANSACTIONS. AS PER THE STATEMENT OF SHRI 13 VIPUL BHAT, ONE SHRI SANDEEP MAROO WAS THE INTERMED IARY WHO INTRODUCED VARDHAN FAMILY TO HIM AND THE SAID GROUP IS A BENEFICIARY OF LONG-TERM CAPITAL GAINS. 4.6 THE FAMILY MEMBERS OF VARDHAN GROUP, DURING SEA RCH PROCEEDINGS ON THE GROUP, STATED THAT ENTIRE DEALINGS WERE DONE BY SHRI RAMESH VARDHAN WHOSE STATEMENT WAS RECORDED ON 12/05/2016. SHRI RAMESH VARDHAN, IN REPLY TO QUESTION NO. 64, SUBMITTED THA T TRADING IN SHARES OF M/S SAL WAS GENUINE TRANSACTIONS THOROUGH STOCK EXC HANGE FOLLOWING ALL PROCESS AND LEGAL PROCEDURES. THE STATEMENT OF SHRI VIPUL BHAT WAS CONFRONTED TO THE ASSESSEE IN QUESTION NO.65. HOWEV ER, SHRI RAMESH VARDHAN DENIED BEING AWARE OF THE FACTS STATED THER EIN AND REITERATED THAT SHARES WERE SOLD THROUGH BROKERS AND PAYMENTS WERE RECEIVED THROUGH BANKING CHANNELS. 4.7 THE LD. CIT(A), AT PARA-9.2 OF THE IMPUGNED ORD ER, OBSERVED THAT THE SHARES WERE ACQUIRED OFFLINE AND LARGE NUMBER O F SHARES WERE ALLOTTED AS BONUS / PREFERENTIAL SHARES. SUCH OFFLI NE PURCHASE OF SHARES ON WHICH ABNORMAL LTCGS FROM THE PENNY STOCK COMPAN IES HAS BEEN DECLARED, WOULD BE A STRONG INDICATOR OF BOGUS NATU RE OF ENTIRE TRANSACTIONS. 4.8 FINALLY, THE PLETHORA OF DOCUMENTARY EVIDENCES SUBMITTED BY THE ASSESSEE IN SUPPORT OF THE TRANSACTIONS WERE TERMED AS SELF-SERVING DOCUMENTS AND THE ACTION OF LD.AO, IN MAKING THE AD DITIONS, WAS CONFIRMED. AGGRIEVED, THE ASSESSEE IS UNDER FURTHER APPEAL BEF ORE US. 5. THE LD. AUTHORIZED REPRESENTATIVE FOR ASSESSEE ( AR), REITERATING THE SUBMISSION MADE BEFORE LD. CIT(A), VEHEMENTLY A SSAILED THE 14 IMPUGNED ORDER. AU CONTRAIRE, LD. CIT-DR SUPPORTED THE FINDINGS OF LOWER AUTHORITIES AND PLEADED FOR CONFIRMATION OF I MPUGNED ORDER. 6. WE HAVE CAREFULLY HEARD THE RIVAL SUBMISSIONS AN D PERUSED RELEVANT MATERIAL ON RECORD. SO FAR AS THE FACTUAL MATRIX IS CONCERNED, THERE IS NO SUBSTANTIAL DISPUTE REGARDING THE SAME. THE PERUSAL OF RECORD WOULD REVEAL THAT THE ASSESSEE PURCHASED CERTAIN SH ARES OF AN ENTITY NAMELY M/S STL AS EARLY AS SEPTEMBER, 2011. THE SHA RES WERE CONVERTED INTO DEMAT FORM IN ASSESSEES ACCOUNT DUR ING THE MONTH OF MARCH, 2012. THE TRANSACTIONS TOOK PLACE THROUGH BA NKING CHANNELS. THE INVESTMENTS WERE DULY REFLECTED BY THE ASSESSEE IN FINANCIAL STATEMENTS OF RESPECTIVE YEARS. THE COPIES OF FINAN CIAL STATEMENTS OF M/S STL FOR FYS 2009-10 & 2010-11 WHICH LED TO INVESTME NT BY THE ASSESSEE IN THAT ENTITY WAS ALSO FURNISHED DURING T HE COURSE OF ASSESSMENT PROCEEDINGS. SUBSEQUENTLY, M/S STL GOT M ERGED WITH ANOTHER ENTITY VIZ. M/S SAL PURSUANT TO SCHEME OF A MALGAMATION U/S 391 TO 394 OF THE COMPANIES ACT, 1956. THE SCHEME WAS D ULY APPROVED BY HONBLE BOMBAY HIGH COURT VIDE ORDER DATED 22/03/20 13, A COPY OF WHICH IS ON RECORD. CONSEQUENTLY, THE SHARES OF M/S STL HELD BY THE ASSESSEE GOT SWAPPED WITH THE SHARES OF M/S SAL AND NEW SHARES WERE ALLOTTED TO THE ASSESSEE DURING JUNE, 2013 PURSUANT TO THE APPROVED SCHEME OF AMALGAMATION. M/S SAL IS STATED TO BE LIS TED PUBLIC COMPANY GROUP A SHARES SIGNIFYING HIGH TRADES WITH HIGH L IQUIDITY. THE ASSESSEE HAS SOLD THESE SHARES THROUGH ITS STOCK BROKER NAME LY M/S UNIQUE STOCKBRO PRIVATE LIMITED IN ONLINE PLATFORM OF THE RECOGNISED STOCK EXCHANGE DURING THE MONTH OF MARCH, 2014. THE SELLI NG PRICE WAS IN THE RANGE OF RS.489/- TO RS.491/- PER SHARE. THE TRANSA CTIONS TOOK PLACE 15 THROUGH ONLINE MECHANISM AFTER COMPLYING WITH ALL T HE FORMALITIES AND PROCEDURE INCLUDING PAYMENT OF STT. THE DELIVERY OF THE SHARES WAS THROUGH CLEARING MECHANISM OF THE STOCK EXCHANGE AN D SALE CONSIDERATION WAS RECEIVED THROUGH BANKING CHANNELS . THE TRANSACTIONS ARE DULY EVIDENCED BY CONTRACT NOTES, DEMAT STATEME NTS, BANK STATEMENTS AND OTHER DOCUMENTARY EVIDENCES. THE KEY PERSON OF ASSESSEE GROUP, IN HIS STATEMENT, MAINTAINED THE PO SITION THAT TRADING TRANSACTIONS WERE GENUINE TRANSACTIONS CARRIED OUT THROUGH STOCK EXCHANGE FOLLOWING ALL PROCESS AND LEGAL PROCEDURES . THE ASSESSEE ALSO FILED TRADING VOLUME DATA AND PRICE RANGE OF THE SC RIP FOR A PERIOD OF MORE THAN 2 YEARS I.E. FROM JAN, 2013 TO JULY, 2015. THE SHARES REFLECTED HEALTHY TRADING VOLUME AND THE PRICE RANGE REFLECTE D THEREIN WAS IN THE RANGE OF RS.360/- TO RS.600/- PER SHARE. THE PRICE RANGE WAS STATED TO BE IN THE SAME RANGE FOR 15 MONTHS AFTER THE PERIOD OF SALE OF SHARES BY THE ASSESSEE, WHICH HAS NOT BEEN DISPUTED BY THE RE VENUE. ON THE BASIS OF ALL THESE FACTS, IT COULD BE GATHERED THAT THE A SSESSEE HAD DULY DISCHARGED THE ONUS CASTED UPON HIM TO PROVE THE GE NUINENESS OF THE STATED TRANSACTIONS AND THE ONUS HAD SHIFTED ON REV ENUE TO REBUT THE SAME. 7. AS AGAINST THE ASSESSEES POSITION, THE PRIMARY MATERIAL TO MAKE ADDITIONS IN THE HANDS OF ASSESSEE IS THE STATEMENT OF SHRI VIPUL BHAT AND THE OUTCOME OF SEARCH PROCEEDINGS ON HIS ASSOCI ATED ENTITIES INCLUDING M/S SAL. HOWEVER, THERE IS NOTHING ON REC ORD TO ESTABLISH VITAL LINK BETWEEN THE ASSESSEE GROUP AND SHRI VIPUL BHAT OR ANY OF HIS GROUP ENTITIES. THE ASSESSEE, ALL ALONG, DENIED HAVING KN OWN SHRI VIPUL BHAT OR ANY OF HIS GROUP ENTITIES. HOWEVER, NOTHING HAS BEE N BROUGHT ON RECORD 16 TO CONTROVERT THE SAME AND ESTABLISH THE LINK BETWE EN SHRI VIPUL BHAT AND THE ASSESSEE. THE OPPORTUNITY TO CROSS-EXAMINE SHRI VIPUL BHAT WAS NEVER PROVIDED TO THE ASSESSEE WHICH IS CONTRARY TO THE DECISION OF HONBLE SUPREME COURT IN M/S ANDAMAN TIMBER INDUSTRIES V/S CCE (CA NO.4228 OF 2006) WHEREIN IT WAS HELD THAT NOT ALLOWING THE ASSESSEE TO CROSS-EXAMINE THE WITNESSES BY THE ADJU DICATING AUTHORITY THOUGH THE STATEMENT OF THOSE WITNESSES WERE MADE T HE BASIS OF THE IMPUGNED ORDER IS A SERIOUS FLAW WHICH MAKES THE OR DER NULLITY IN AS MUCH AS IT AMOUNTS TO VIOLATION OF PRINCIPAL OF NAT URAL JUSTICE BECAUSE OF WHICH THE ASSESSEE WAS ADVERSELY AFFECTED. THE WHOL E BASIS OF MAKING THE ADDITION IS THIRD PARTY STATEMENT WITHOUT THERE BEING ANY TANGIBLE MATERIAL. IT IS TRITE LAW THAT ADDITIONS MERELY ON THE BASIS OF SUSPICIOUS, CONJECTURES OR SURMISES COULD NOT BE SUSTAINED IN T HE EYES OF LAW AS HELD BY HONBLE SUPREME COURT IN OMAR SALAY MOHAMED SAIT V/S CIT (1959 37 ITR 151). THE SUSPICION HOWEVER STRONG COULD NOT PARTAKE THE CHARACTER OF LEGAL EVIDENCE AS HELD BY HONBLE SUPR EME COURT IN UMACHARAN SHAW & BROS. V/S CIT (1959 37 ITR 271) . THEREFORE, WE FIND THAT ONUS AS CASTER UPON REVENUE TO CORROBORAT E THE IMPUGNED ADDITIONS BY CONTROVERTING THE DOCUMENTARY EVIDENCE S FURNISHED BY THE ASSESSEE AND BY BRINGING ON RECORD, ANY COGENT MATE RIAL TO SUSTAIN THOSE ADDITIONS, COULD NOT BE DISCHARGED BY THE REV ENUE. THE ALLEGATION OF PRICE RIGGING / MANIPULATION HAS BEEN LEVIED WIT HOUT ESTABLISHING THE VITAL LINK BETWEEN THE ASSESSEE AND VARIOUS ENTITIE S OF SHRI VIPUL BHAT. WE FIND THAT THE WHOLE BASIS OF MAKING ADDITIONS IS THIRD PARTY STATEMENT AND NO OPPORTUNITY OF CROSS-EXAMINATION HAS BEEN PR OVIDED TO THE ASSESSEE TO CONFRONT THE SAID PARTY. AS AGAINST THI S, THE ASSESSEES 17 POSITION THAT THAT THE TRANSACTIONS WERE GENUINE AN D DULY SUPPORTED BY VARIOUS DOCUMENTARY EVIDENCES, COULD NOT BE DISTURB ED BY THE REVENUE. 8. THE ALLEGATIONS OF LD.AO THAT THE ASSESSEE WAS P ART OF THE GROUP WHICH INDULGED IN RIGGING OR MANIPULATION OF PRICES OF SHARES IN CONNIVANCE WITH SHRI VIPUL BHAT IS NOT BACKED BY AN Y INDEPENDENT MATERIAL. FIRSTLY, THERE IS NOTHING ON RECORD WHICH ESTABLISHES THE FACT THAT THE ASSESSEE WAS ACQUAINTED WITH SHRI VIPUL BHAT OR ANY OF HIS ENTITIES AND SECONDLY, THE ONUS CASTED UPON ASSESSEE TO PROV E THE GENUINENESS OF THE TRANSACTIONS WAS ALREADY DISCHARGED BY THE A SSESSEE. SHRI VIPUL BHAT, IN HIS STATEMENT, STATED THAT ONE SHRI SANDEE P MAROO ACTED AS INTERMEDIARY WHO INTRODUCED VARDHAN FAMILY TO HIM. HOWEVER, NO FURTHER INVESTIGATIONS HAVE BEEN CARRIED OUT TO ESTABLISH T HIS VITAL LINK BETWEEN THE ASSESSEE AND SHRI VIPUL BHAT. WE DO NOT FIND AN Y INDEPENDENT INVESTIGATIONS BY LD. AO TO BRING ON RECORD ANY TAN GIBLE MATERIAL TO CORROBORATE THE SAME. THERE ARE NO EVIDENT OR EVEN ALLEGATION OF ANY CASH EXCHANGE BETWEEN THE ASSESSEE AND GROUP ENTITI ES OF SHRI VIPUL BHAT. THIS IS FURTHER EVIDENCED BY THE FACT THAT NO SUBSTANTIAL INCRIMINATING MATERIAL / WEALTH OF THAT MAGNITUDE H AS BEEN FOUND DURING THE COURSE OF SEARCH OPERATIONS ON ASSESSEE WHICH W OULD CORROBORATE SUCH PRESUMPTION AND PROVE THAT THE TRANSACTIONS WE RE SHAM TRANSACTIONS, IN ANY MANNER. 9. THE FACT THAT THE ASSESSEE COULD NOT PRODUCE THE CONCERNED PERSON OF M/S SAL WAS RIGHTLY CONTROVERTED BY SUBMI TTING THAT THE AFORESAID ENTITY WAS NOT UNDER THE CONTROL OF THE A SSESSEE AND THE ASSESSEE WAS UNDER NO OBLIGATION TO DO SO. THE EXIS TENCE OF M/S SAL IS BEYOND DOUBT SINCE IT WAS A LISTED CORPORATE ENTITY AND SECONDLY, IT WAS 18 SUBJECT MATTER OF SCHEME OF AMALGAMATION U/S 391 TO 394. THE SCHEME OF AMALGAMATION WAS DULY BEEN APPROVED BY HONBLE B OMBAY HIGH COURT. THEREFORE, THE EXISTENCE OF THE SAID ENTITY COULD NOT BE DOUBTED, IN ANY MANNER. 10. THE ABOVE CONCLUSION IS FURTHER FORTIFIED BY TH E FACT THAT IN SHARE SALE TRANSACTIONS THROUGH ONLINE MODE, THE IDENTITY OF THE BUYER OF THE SHARES WOULD NOT BE KNOWN TO THE ASSESSEE. THEREFOR E, THE ADVERSE CONCLUSION DRAWN BY LD. AO MERELY ON THE BASIS OF T HE FACT THAT THE BUYER OF THE SHARES WERE GROUP ENTITIES OF SHRI VIP UL BHAT, COULD NOT BE SUSTAINED. THE FACT THAT THERE WERE INDEPENDENT BUY ERS ALSO WOULD REBUT THE SAME AND WEAKEN THE CONCLUSION DRAWN BY LD. AO. 11. THE LD. AR HAS RELIED ON PLETHORA OF JUDICIAL P RONOUNCEMENTS IN SUPPORT OF VARIOUS SUBMISSIONS, WHICH WE HAVE DULY CONSIDERED. THESE DECISIONS WOULD ONLY SUPPORT THE CONCLUSIONS DRAWN BY US THAT ONCE THE ASSESSEE HAS DISCHARGED THE ONUS OF PROVING THE GEN UINENESS OF THE TRANSACTIONS, THE ONUS WOULD SHIFT ON THE REVENUE T O DISLODGE ASSESSEES CLAIM AND BRING ON RECORD CONTRARY EVIDENCES TO REB UT THE SAME. UNTIL AND UNLESS THIS EXERCISE IS CARRIED OUT, THE ADDITI ONS COULD NOT BE SUSTAINED IN THE EYES OF LAW. 12. TO ENUMERATE THE FEW, THE HONBLE BOMBAY HIGH C OURT IN CIT V/S SHYAM S.PAWAR (54 TAXMANN.COM 108 10/12/2014) DECLINED TO ADMIT REVENUES APPEAL SINCE THE REVENUE FAILED TO CARRY FORWARD THE INQUIRY TO DISCHARGE THIS BASIC ONUS. THE CO-ORDINATE BENCH OF THIS TRIBUNAL IN MUKESH R.MAROLIA V/S ADDL. CIT (6 SOT 247 15/12/200 5) HELD THAT PERSONAL KNOWLEDGE AND EXCITEMENT ON EVENTS SHOULD NOT LEAD THE ASSESSING OFFICER TO A STATE OF AFFAIRS WHERE SALIE NT EVIDENCES ARE OVER- 19 LOOKED. WHEN EVERY TRANSACTION HAS BEEN ACCOUNTED, DOCUMENTED AND SUPPORTED, IT WOULD BE VERY DIFFICULT TO BRUSH ASID E THE CONTENTIONS OF THE ASSESSEE THAT HE HAD PURCHASED SHARES AND HAD SOLD SHARES AND ULTIMATELY PURCHASED A FLAT UTILIZING THE SALE PROC EEDS OF THOSE SHARES AND THEREFORE, THE CO-ORDINATE BENCH CHOSE TO DELET E THE IMPUGNED ADDITIONS. WE FIND THAT THIS DECISION WAS FIRSTLY B EEN APPROVED BY HONBLE BOMBAY HIGH COURT VIDE ITA NO. 456 OF 2007 ON 07/09 /2011 AND THEREAFTER, SPECIAL LEAVE PETITION AGAINST THE SAID DECISION HAS BEEN DISMISSED BY HONBLE SUPREME COURT VIDE SLP NO. 201 46 OF 2012 DATED 27/01/2014 WHICH IS REPORTED AS 88 CCH 0027 SCC. THE SMC BENCH OF TRIBUNAL IN ANRAJ HIRALAL SHAH (HUF) V/S ITO (ITA NO. 4514/MUM/2018 DATED 16/07/2019) HELD THAT IN THE ABSENCE OF ANY EVIDENCE TO IMPLICATE THE ASSESSEE OR TO PROVE THAT THE TRANSACTIONS WERE BOGUS, THE LONG-TERM CAPITAL GAINS DECLARED BY THE ASSESSEE COULD NOT BE DOUBTED WITH. THIS CASE WAS DEALING WITH GAINS E ARNED BY THE ASSESSEE ON SALE OF SAME SCRIP I.E. M/S SUNRISE ASI AN LTD. 13. THEREFORE, CONSIDERING THE ENTIRETY OF FACTS AN D CIRCUMSTANCES, WE ARE NOT INCLINED TO ACCEPT THE STAND OF LD.CIT(A) I N SUSTAINING THE IMPUGNED ADDITIONS IN THE HANDS OF THE ASSESSEE. RE SULTANTLY, THE ADDITION ON ACCOUNT OF ALLEGED LONG-TERM CAPITAL GAINS AS WELL AS ESTIMATED COMMISSION AGAINST THE SAME, STANDS DELET ED. THE GROUNDS OF APPEAL, TO THAT EXTENT, STAND ALLOWED. 14. THE GROUNDS RELATING TO LEVY OF INTEREST AS WEL L AS INITIATION OF PENALTY, BEING CONSEQUENTIAL IN NATURE, WOULD NOT R EQUIRE ANY SPECIFIC ADJUDICATION ON OUR PART. FINALLY, THE APPEAL STAND S PARTLY ALLOWED IN TERMS OF OUR ABOVE ORDER. 20 ITA NO.7649, 7650, 7651, 7662 / MUM/2019 FOR A.Y. 2 014-15: 15. IT IS AN ADMITTED POSITION THAT FACTS ARE PARI- MATERIA THE SAME IN ALL THESE APPEALS. THE ASSESSMENT WAS FRAMED IN THE HAN DS OF VARIOUS ASSESSEE, IN SIMILAR MANNER, WHEREIN LONG-TERM CAPI TAL GAINS EARNED BY ALL THE FOUR ASSESSEE WERE TREATED AS UNEXPLAINE D INCOME AND ADDED TO THEIR INCOME WITH FURTHER ADDITION OF ESTIMATED COMMISSION INCOME OF 2%. THE IMPUGNED ORDERS ARE ON SIMILAR LINES. THE A SSESSEE IS BEFORE US WITH IDENTICAL GROUNDS OF APPEAL. THEREFORE, OUR FINDINGS, CONCLUSION AS WELL AS ADJUDICATION AS FOR ITA NO.7648/MUM/2019 SHALL MUTATIS- MUTANDIS APPLY TO ALL THESE APPEALS AS WELL. RESULTANTLY, AL L THESE APPEALS STAND PARTLY ALLOWED, IN SIMILAR MANNER. CONCLUSION 16. ALL THE APPEAL STANDS PARTLY ALLOWED IN TERMS OF OUR ABOVE ORDER. ORDER PRONOUNCED IN THE OPEN COURT ON 11 TH AUGUST, 2020. SD/- SD/- (MAHAVIR SINGH) (MANOJ KUMAR AGGARWAL) / VICE PRESIDENT / ACCOUNTANT MEMBER MUMBAI; DATED : 11/08/2020 SR.PS, JAISY VARGHESE !'! / COPY OF THE ORDER FORWARDED TO : 1. ') / THE APPELLANT 2. *+') / THE RESPONDENT 3. ! !2 ( ) / THE CIT(A) 4. ! !2 / CIT CONCERNED 5. 34!*56 , !!6 , / DR, ITAT, MUMBAI 6. 489 / GUARD FILE 21 / BY ORDER, / (DY./ASSTT.REGISTRAR) , / ITAT, MUMBAI.