Shri Prahlad S. Mehta L/h of late Rajpal P. Mehta, Ahmedabad V. The Income Tax Officer, Ward-10(3) Now Ward-5(2)(3), Ahmedabad

ITA 796/AHD/2016

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 8121 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 year(s) 7 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-11-2017
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: SMC
• Assessment Year: 2004-2005
• Appeal Filed On: 31-03-2016
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: G C DAXINI
• Keywords: Reopening of assessment; Capital asset; Income from undisclosed sources; Search and seizure; Principle of natural justice; Corroborative evidences; Accommodation entries
• Section: 143(3); 234B; 147; 68; 69; 148; 132

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD SMC BENCH BEFORE: SHR I MAHAVIR PRASAD , JUDICIAL MEMBER AND SHRI AMARJIT SINGH, ACCOUNTANT MEMBER SHRI RAJPAL P MEHTA (DECEASED), L/H OF PARHL AD S. MEHTA, 15, NAVYUG SOCIETY, S.M. ROAD, AMBAWADI, AHMEDABAD - 380015 PAN: AAY P M5916F (APPELLANT) VS THE ITO, OLD WARD 10(3), NEW WA RD 5(2)(3), NARAYAN CHAMBERS, ASHRAM ROAD, AHMEDAB AD - 380009 (RESPONDENT) SMT. NAJUBEN RAJPAL MEHTA, 15, NAVYUG SOCIETY, S.M. ROAD, AMBAWADI, AHMEDABAD - 380015 PAN: ACSPM2375E (APPELLANT) VS THE ITO, OLD WARD 10(3), NEW WARD 5(2)(3) , NARAYAN CHAMBERS, ASHRAM ROAD, AHMEDABAD - 380009 (RESPONDENT) REVENUE BY : S H RI G.C. DAXINI , SR. D . R. ASSESSEE BY: MS URVASHI SHODHAN , A.R. DATE OF HEARING : 20 - 09 - 2 0 17 DATE OF PRONOUNCEMENT : 16 - 11 - 2 017 I T A NO . 796 / A HD/20 16 A SSESSM ENT YEAR 200 4 - 05 ITA NO. 797 /AHD/20 16 ASSESSMENT YEAR 200 4 - 05 I.T.A NO S . 796 & 797 /AHD/20 16 A.Y. 200 4 - 05 PAGE NO PRAHLAD S. MEHTA & NAJUBEN RAJPAL MEHTA VS. ITO 2 / ORDER P ER : AMARJIT SINGH, ACCOUNTANT MEMBER : - THESE TWO DIFFERENT ASSESSEE S APPEAL S FOR A.Y. 2004 - 05 , AR ISE FROM ORDER OF THE CIT(A) - 5, AHMEDABAD DATED 26 - 02 - 2016 , IN PROCEEDINGS UNDER SECTION 147 R.W.S. 143(3) OF THE INCOME TAX ACT, 1961; IN SHORT THE ACT . 2. AS THE FACTS IN BOTH THESE APPEALS ARE SIMILAR, WE TAKE ITA NO. 796/AHD/2016 AS THE LEAD CASE AND DECIDE BOTH THE APPEALS FOR THE SAKE OF CONVENIENCE. 3. THE ASSESSEE HAS RAISE D FOLLOWING GROUNDS OF APPEAL: - 796/AHD/2016 1. THE LD. COMMISSIONER OF INCOME TAX (APPEALS) - S, AHMEDABAD HAS ERRED IN UPHOLDING RE - ASSESSMENT PROCEEDINGS U/S.147/148 OF THE I T ACT, 1961 AS VALID FOR THE ASST. YEAR 2004 - 05. THE RE - ASSESSMENT PROCEEDINGS INITIATED U/S.147 /148, ON A DECEASED PERSON, ARE BAD IN LAW, ILLEGAL, VOID AB INITIO, TIME BARRED WITHOUT JURISDICTION AND PROPER AUTHORIZATION. 2. THAT THE LD. COMMISSIONER OF INCOME TAX (APPEALS) - S, AHMEDABAD HAS ERRED IN CONFIRMING THE ADDITION OF RS. 5,59,500/ - AS UNDISCLOSED INCOME, AS AGAINST SHORT TERM CAPITAL GAIN DECLARED BY THE APPELLANT ON SALE OF SHARES. 3. THE APPELLANT CONTENDS THAT THERE IS NO INFORMATION ON RECORD ON THE BASIS OF WHICH, IT CAN BE INFERRED THAT THE APPELLANT'S INCOME ESCAPE D THE ASSESSMENT AND THE PROCEEDINGS INITIATED U/S. 148 OF THE ACT FOR MAKING ROAMING INQUIRIES ARE ILLEGAL, BAD IN LAW AND VOID AB INITIO. THEREFORE, ADDITION TO THE INCOME IS WITHOUT \ PROPER APPLICATION OF MIND, LAW AND NATURAL JUSTICE. 4. THAT NEITHER LD. CIT(A) - 5 OR LD. A.O. DID NOT PROVIDE A COPY OF STATEMENT OF MUKESH CHOSKHI DATED 25/11/2011. THE APPELLANT CONTENDS THAT THERE WAS NO REFERENCE OF THE TRANSACTION OF THE APPELLANT, HENCE IT CANNOT BE RELIED FOR REOPENING THE ASSESSMENT PROCEEDINGS FOR ROAMING INQUIRY AND MAKING ADDITION TO THE INCOME OF THE APPELLANT. 5. THAT THE APPELLANT HAD PURCHASED SHARES PAYING PURCHASE CONSIDERATION, GOT THE SHARES DULY TRANSFERRED AS CAPITAL ASSETS OF THE APPELLANT AND UPON SALE OF THESE SHARES/CAPITAL ASS ETS REALIZED SALE PROCEEDS / PROFITS, HENCE INCOME IS AS CAPITAL GAINS AND IN ABSENCE OF ANY EVIDENCE AGAINST THE APPELLANT, THE LD. A.O. AND LD. CIT (APPEALS) CAN NOT CONSIDER IT AS INCOME FROM UNDISCLOSED SOURCES,. I.T.A NO S . 796 & 797 /AHD/20 16 A.Y. 200 4 - 05 PAGE NO PRAHLAD S. MEHTA & NAJUBEN RAJPAL MEHTA VS. ITO 3 6. THAT THE APPELLANT CONTENDS THAT LD. A.O. AND LD. CIT (APPEALS) BOTH HAVE NOT DISCHARGED THE BURDEN OF PROVING TRANSACTIONS TO BE FRAUDULENT, SHAM OR IN ANY MANNER VIOLATIVE IN LAW. THE APPELLANT FURTHER CONTENTS THAT LD. A.O. IS BURDENED TO ESTABLISH RATHER THAN SIMPLY RELYING UPON THE GENERAL STATEMENT OF MUKESH CHOKSHI AND OR THE DIRECTION OF THE HIGHER AUTHORITIES, DIRECTING REOPENING OF ASSESSMENT PROCEEDINGS. 7. THAT THE LD. CIT (APPEALS) DID NOT APPRECIATE THAT OFF - MARKET TRANSACTIONS MADE BY THE APPELLANT WERE VALID IN LAW AND THAT THERE WAS NO JUSTIFICATION IN CONSIDERING PROFIT ON SALE AND TRANSFER OF CAPITAL ASSET AS UNDISCLOSED INCOME. 8. THAT THE APPELLANT CONTENDS THAT ASSESSMENT OF GOLD STAR FINVEST PVT. LTD. FOR ASST. YEARS 2005 - 06 AND 2007 - 08 CAN NOT DECIDE THE N ATURE OF TRANSACTIONS WITH THE APPELLANT IN ASST. YEAR 2003 - 04. 9. THAT THE LD. CIT (APPEALS) HAS ERRED IN DIRECTING TO CHARGE INTEREST U/S. 234B OF RS.1,61,503/ - OF THE IT ACT, WHICH MAY BE CANCELLED. 10. THAT THE LEARNED CIT (APPEALS) HAS ERR ED IN CONFIRMING INITIATION OF PENALTY PROCEEDING U/S. 271 (1 )(C) OF THE ACT. 11. IN VIEW OF THE ABOVE AND OTHERS THAT MAY URGED AT THE TIME OF HEARING, IT PRAYED THAT: - (I) THAT THE PROCEEDINGS U/S. 148 BE HELD TO BE INVALID BEING AGAINST THE PRINC IPALS OF NATURAL JUST ICE AND ADDITION OF RS.5,59,500/ - AND THE ORDER PASSED BY THE LEARNED A.O. MAY PLEASE BE CANCELLED OR QUASHED. (II) THE ADDITIONS O F RS. 5,59,500/ - MADE TO THE INCOME OF THE APPELLANT AS INCOME FROM UNDISCLOSED SOURCE MAY PLEASE BE DEL ETED AND DEDUCTIONS AND RELIEFS AS CLAIMED MAY PLEASE BE ALLOWED. (III)THAT THE INTEREST CH ARGED U/S. 234B OF RS. 1,61,503/ - OF THE IT ACT MAY BE CANCELLED. (IV)PENALTY PROCEEDINGS INITIATED U/S. 271(1 )(C) MAY PLEASE BE CANCELLED AND NOTICE BE VACATED. (V) SUCH OTHER RELIEF O R REDUCTION AS THE FACTS AND CIRCUMSTANCES OF THE CASE SO REQUIRE BE GRANTED. 4 . IN THIS CASE, RETURN OF INCOME DECLARING INCOME OF RS. 2 , 92 , 496/ - WAS FILED ON 1 ST NOV, 2004. INFORMATION WAS RECEIVED ON THE BASIS OF SEARCH AND SEIZ URE ACTION U/S. 132 CARRIED OUT IN THE GROUP CASES OF M/S, MAHASAGAR SECURITIES PVT. LTD. (NOW KNOWN AS ALANG SECURITIES SECURITY PVT. LTD.) WHEREIN IN THE COURSE OF SEARCH SHRI MUKESH CHOKSHI, WHO WAS MANAGING AND CONTROLLING THE SAID GROUP HAD ADMITTE D IN HIS STATEMENT THAT THAT THE GROUP WAS ENGAGED IN PROVIDING BOGUS ENTRIES OF SPECULATION PROFIT/LOSS, COMMODITIES PROFIT/LOSS. SUBSEQUENTLY, THE CASE OF THE ASSESSEE WAS REOPENED BY ISSUING OF NOTICE U/S. 148 ON 30 TH MARCH, 2011 STATING THAT THE ASS ESSEE WAS ALSO INVOLVED IN SUCH BOGUS TRANSACTION S DURING THE FINANCIAL YEAR 2003 - 04 RELEVANT TO THE ASSESSMENT YEAR 2004 - 05. I.T.A NO S . 796 & 797 /AHD/20 16 A.Y. 200 4 - 05 PAGE NO PRAHLAD S. MEHTA & NAJUBEN RAJPAL MEHTA VS. ITO 4 DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSEE HAS RAISED OBJECTION THAT IN HIS CASE EARLIER ORDER U/S. 143(3) R.W.S. 1 47 WAS PASSED ON 24 TH DECEMBER, 2010 AND ONCE AGAIN NOTICE U/S. 148 WAS ISSUED. THE ASSESSING OFFICER HAS EXPLAINED THAT CONTENTION OF THE ASSESSEE WAS INCORRECT BECAUSE IN EARLIER THE ORDER U/S. 143(3) R.W.S. 147 WAS PASSED FOR THE ASSESSMENT YEAR 2003 - 04 AND NOT FOR ASSESSMENT YEAR 2004 - 05.DURING THE CO URSE OF ASSESSMENT PROCEEDINGS, SHOW CAUSE NOTICE WAS ISSUED TO THE ASSESSEE TO EXPLAIN WHY NOT THE UNDISCLOSED INCOME OF RS. 5 , 59 ,50 0/ - FROM THE SALE OF THE SHARE S OF TALENT INFOWAYS LTD SHOULD NOT BE TREATED AS INCOME FROM UNDISCLOSED SOURCE. THE ASSESSEE HAS OBJECTED TO THE SHOW CAUSE NOTICE BY FURNIS HING THE FOLLOWING SUBMISSION S: - 1. THERE IS NO JUSTIFICATION IN MAKING ADDITION OF THE INCOME BECAUSE THE NATURE AND CHARACTER OF INCOME IS OFF SHORT TERM CAPITAL GAIN CHARGEABLE TO TAX. 2. THE ASSESSEE HAS PURCHASED THE SHARES THROUGH BROKER M/S. GOLD STAR FINVEST PVT LTD. THE ASSESSEE HAS RECEIVED DELIVERY OF SHARES INTO DEMATE ACCOUNT WITH HDFC BANK. THE ASSESSEEFIAS ALSO SHOWN THE SHARES. THE OFF M ARKET TRANSACTION DOES NOT VITIATE OR JEOPARDIZE OF TRANSACTION WHICH IS NOT A ILLEGAL TRANSACTION. 3. THE PURCHASE AND SALE OF THE SHARE ARE SHOWN 1% TO ANOTHER PERSON WHO PURCHASED AND SALE THE SHARE. IT IS COMMERCIAL TRANSACTIONS AND IT DOES NOT CHANGED CHARACTER AND NATURE OF INCOME AND ITS CHARGEABILITY. 4. M/S. GOLD STAR FINVEST PVT LTD WAS BROKER ACTING GENIALLY ON BEHALF OF THE CLIENT FOR THE PURCHASE AND SALE OF SHARE. 5. THE ASSESSMENT PROCEEDING ARE PURELY BASED ON PRESUMPTION AND ON TH E BASIS OF STATEMENT RECORDED OF SHRI MUKESH CHOKSHI. 6. THE ASSESSEE HAS SHOWN THE RELEVANT INCOME FROM SHORT JERM CAPITAL GAIN IN THE RETURN OF INCOME AND HENCE THERE IS NO ESCAPEMENT OF INCOME. 7. THE ASSESSEE HAS RELIED UPON ON FOLLOWING DECISION. [A] MUKESH R. MOROLIA VS. ADDL. CIT (2006) SOT 247 (MUMBAI) [B] ITO 14(3) - L, VS SMT. NAVNEET MEHTA [C] ACIT 14(3), MUMBAI VS. SHRI RAVINDRAKUMAR TOSHNIWAL THE ASSESSING OFFICER HAS NOT ACCEPTED THE SUBMISSION OF THE ASSESSEE ON THE GROUND THAT SHRI MU KESH CHOKSHI ADMITTED VARIOUS COMPANIES FLOATED BY HIM WERE PROVIDED ACCOMMODATION ENTRIES, ONE OF WHICH WAS M/S GOLT STAR FINVEST PVT. LTD. T HE ASSESSEE HAS I.T.A NO S . 796 & 797 /AHD/20 16 A.Y. 200 4 - 05 PAGE NO PRAHLAD S. MEHTA & NAJUBEN RAJPAL MEHTA VS. ITO 5 RECEIVED LONG TERM CAPITAL GAIN ON SALE OF SHARE OF TALENT INFOWAY LTD. THROUGH GOLD STATE FINVE ST P. LTD AMOUNTING TO RS. 5 , 59 , 500/ - . IT WAS OBSERVED THAT THE PURCHASE CONSIDERATION WAS PAID IN CASH AND THESE TRANSACTION S WERE ACTUALLY CARRIED OUT OFF MARKET. THE SHARE S WERE DEMATED TO THE DEMAT A/C OF THE ASSESSEE ONLY ON 13 TH NOVEMBER, 2003 A ND WERE SOLD ON 14 TH NOVEMBER, 2003 . CONSEQUENTLY, THE ASSESSING OFFICER HAS ADDED RS. 5 , 59 , 500/ - AS UNDISCLOSED INCOME U/S. 68 TO THE TOTAL INCOME OF THE ASSESSEE. AGGRIEVED ASSESSEE PREFERRED APPEAL BEFORE THE LD. CIT(A). THE LD. CIT(A) HAS ALLOWED TH E APPEAL OF THE ASSESSEE PARTLY BY OBSERVING AS UNDER: - 4.16 IN VIEW OF THE DISCUSSIONS IN THE PROCEEDINGS PARAS, IT IS CONCLUDED THAT THE TRANSACTION OF THE APPELLANT HAS ITS DIRECT NEXUS WITH BOGUS AND FRAUDULENT TRANSACTIONS CO MMITTED BY THE PROMOTERS OF THE COMPANY AND THE APPELLANT HAS WILLFULLY, DELIBERATELY AND KNOWINGLY CONSPIRED THERE IN. THE APPELLANT CANNOT ARGUE THAT IT WAS CHEATED INTO SUCH TRANSACTIONS. FACT OF THE MATTER INDICATE THAT ALL THE BENEFICIARIES ( I.E. THE PERSONS WHO BOUGHT AND SOLD SHARES) OF SH MUKESH CHOKSI'S GROUP OF COMPANIES WERE ACTIVE COLLABORATORS TO THE BOGUS SHARE TRANSACTIONS WITH THE INTENT AND OBJECTIVE OF GIVING A COLOUR OF CREDENCE AND GENUINENESS TO THE INCOMES OTHERWISE, EARNED FROM UNACCOUNTED SOURCES. 4.17. HE RE IT IS TO BE MENTIONED THAT THERE WAS SEARCH AND SEIZURE ACTION CARRIED OUT ON 25.11.2009 IN THE GROUP CASES OF M/S. MAHASAGAR SECURITIES LTD. AND ITS GROUP COMPANIES CONTROLLED BY SHRI MUKESH N. CHKSHI AT MUMBAI. DURING THE COURSE OF SEARCH PROCEEDINGS SHRI MUKESH N. CHOKSHI HIMSELF HAS ADMITTED THAT ALL HIS GROUP COMPANIES WERE PROVIDING ENTRIES FOR TAKING PROFIT OR LOSS BY SHOWING PURCHASES OR SALES OF SHARES AND SECURITIES TO VARIOUS PARTIES ACROSS INDIA ON WHICH HE WAS CHARGING CERTAIN COMMISSION FRO M THE BENEFICIARY PARTIES. THIS INFORMATION WAS RECEIVED BY THE AO FROM THE OFFICE OF DIT(I&CI) NEW DELHI VIDE LETTER DTD. 7.3.2013 ALONGWITH COPY OF STATEMENT OF SHI MUKESH N. CHOKSHI RECORDED BY THE DEPARTMENT U/S.131 OF THE ACT. FURTHER SHRI MUKESH N. C HOKSHI, THE CONTROLLING PERSON ADMITTED IN HIS STATEMENT RECORDED UNDER OATH U/S.131 ON 16.1.2013 BY SHRI P.S. NAYAK, DCIT(CENTRAL) CIR.46, MUMBAI. THE PAYMENT HAS ALSO BEEN SHOWN IN CASH OF WHICH SOURCES HAVE NOT BEEN EXPLAINED. ON GOING THROUGH THE PURCH ASE AND SALE BILL COPIES IT IS FOUND THAT NO CLIENT CODE 'OF THE APPELLANT HAS BEEN MENTIONED ON THE BILLS AND NEITHER THE SAME HAS BEEN SHOWN TO BE ROUTED THROUGH ANY STOCK EXCHANGE. THUS THE AUTHENTICITY OF THE PURCHASES WAS UNPROVED. MORE SO IT WAS IN D OUBT FOR THE REASONS THAT WHEN THE DELIVERY OF THE SHARES WAS CLAIMED TO HAVE BEEN TAKEN IN PHYSICAL FORM AND THE SAME WERE DEPOSITED IN THE DEMAT ACCOUNT JUST BEFORE FEW DAYS FROM THE DATE OF SALE. THE TRANSACTIONS HAVE BEEN THROUGH SHRI MUKESH CHOKSHI GR OUP OF COMPANIES AND ALL THE TRANSACTIONS ROUTED THROUGH THE AFORESAID COMPANIES WERE ADMITTEDLY NON - GENUINE AS PER THE STATEMENT OF SHRI MUKESH CHOKSHI HIMSELF. 4.17. THE APPELLANT HAS ALTERNATIVELY SUBMITTED THAT THE APPELLANT HAS RETURNED SHORT TERM CA PITAL GAIN OF RS.5,3 3,747/ - FROM SALE OF SHARES OF TALENT INFOTECH LTD. AND SALE PRICE OF THESE SHARES RS.5,59,500/ - IS ADDED AS INCOME FROM UNDISCLOSED SOURCES, THEREFORE, RS.5,33,747/ - IS REQUESTED TO BE REDUCED FROM INCOME OF APPELLANT IF ADDITION OF R S.5,59,500/ - IS SUSTAINED OR ELSE THERE SHALL BE DOUBLE TAXATION OF INCOME. I.T.A NO S . 796 & 797 /AHD/20 16 A.Y. 200 4 - 05 PAGE NO PRAHLAD S. MEHTA & NAJUBEN RAJPAL MEHTA VS. ITO 6 5 . DURING THE COURSE OF APPELLATE PROCEEDINGS BEFORE US, THE LD. COUNSEL HAS FURNISHED PAPER BOOK CONTAINING INFORMATION RELATING TO COMPUTATION OF TOTAL INCOME, ASSESSMENT ORDER U/S. 143(3), NOTICE U/S. 148 , SUBMISSION MADE BEFORE THE ASSESSING OFFICER AND CIT(A) ETC . THE LD. COUNSEL HAS CONTENDED THAT LD. CIT(A) HAS ERRED IN SUSTAINING ADDITION MADE BY THE ASSESSING OFFICER IN SPITE OF THE FACT THAT ASSESSEE HAS EXPLAINED TRAN SACTIONS WITH THE SUPPORTING EVIDENCES . S HE HAS ALSO PLACED RELIANCE ON THE DECISION OF HON BLE HIGH COURT OF GUJARAT IN THE CASE OF PR. COM MISSIONER OF INCOME TAX VS. VINEE T SURESH CHANDRA TAX APPEA L 645 OF 2017 AND THE DECISION OF THE COORDINATE BENCH O F ITAT AHMEDABAD . ON THE OTHER HAND, LD. DEPARTMENTAL REPRESENTATIVE HAS SUPPORTED THE ORDER OF LD. CIT(A). 6 . WE HAVE HEARD BOTH THE SIDES AND PERUSED THE MATERIAL ON RECORD. WE FIND THAT THE CO - ORDINATE BENCH OF THE ITAT AHMEDABAD HAS DECIDED THE I DENTICAL ISSUE IN THE CASE OF THE ACIT VS. VINEE T SURESH CHANDRA AGRAWAL VIDE ITA NO. 1442/AHD/2013 DATED 6 TH JAN, 2017 . THE RELEVANT PART OF THE DECISION IS REPRODUCED AS UNDER : - 9. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. APROPOS THE ISSUE OF ALLEGED SHARE SCAM OF SHRI MUKESH CHOKSI, THE MUMBAI TRIBUNAL HAS ALREADY CONSIDERED THE ASPECTS OF ALLEGED 'SHARES SCAM', INVOLVEMENT OF SHRI MUKESH CHOKSI AND GROUP ENTITIES IN VARIOUS CASES. IN SIMILAR SET OF FACTS, THE T RIBUNAL HAS DELETED ADDITION MADE U/S. 68/69 OF THE I. T. ACT, 1961 QUA THE CLAIMS OF LONG TERM AND SHORT TERM CAPITAL GAINS IN FOLLOWING CASES WHICH ARE RELIED ON BY LD. CIT(A): (A) SMT. HAMIDA J. RATTONSEY VS. DCIT (B) ITO VS. RASILA N. GADA (C) SMT. DUR GADEVI MUNDRA VS. ITO (D) SACHIN N. MORAKHIA VS. ITO (E) MUKESH R. MAROLIA VS. ACIT((2006) 6 SOT 247) (F) CIT VS. MUKESH R. MAROLIA (BOMBAY HC) (G) ITO VS. TRUPTIC SHAH (H) ACIT VS. SHRIRAVINDRAKUMAR TOSHNIWAL (I) ITO VS. SMT. NAVNEET MEHRA I.T.A NO S . 796 & 797 /AHD/20 16 A.Y. 200 4 - 05 PAGE NO PRAHLAD S. MEHTA & NAJUBEN RAJPAL MEHTA VS. ITO 7 9.1 FOLLOWING THESE PRECEDENTS, THE ITAT - AHMEDABAD BY FOLLOWING JUDGMENTS, DELETED SIMILAR ADDITIONS MADE BY AUTHORITIES BELOW BY HOLDING THAT SHORT/LONG TERM CAPITAL GAIN OFFERED BY ASSESSEE WERE ACCOMMODATION ENTRIES PROVIDED BY SUCH PERSONS AND ADDING THE AMOUNTS OF SUCH GAINS U/S. 68 / 69 OF THE I. T. ACT, 1961: A) ITO VS. SHRI PRAKASHCHAND S. SANDH B) ACIT VS. MAHESHG. VAKIL C) ACIT VS. HIMANI M. VAKIL D) MANOJKUMARSARAWANGI HUF VS. ACIT 9.2 THE PROPOSITION THAT, SHARE PURCHASES THROUGH BROKER MAHASAGAR SECURITIES PVT. LTD. ARE NOT RECORDED IN THE NAME OF, THE ASSESSEE ON THE FLOOR OF STOCK EXCHANGES OUTSIDE THE FLOOR OF STOCK EXCHANGE HAS NOT BEEN HELD AS UNLAWFUL ACTIVITY AS HELD BY MUMBAI ITAT IN THE CASE OF MUKESH MORALIA ((2006) 6 SOT 247) AS UNDER: '10.3 PURCHASE AND S ALE OF SHARES OUTSIDE THE FLOOR OF STOCK EXCHANGE IS NOT AN UNLAWFUL ACTIVITY. OFF - MARKET TRANSACTIONS ARE NOT ILLEGAL. IT IS ALWAYS POSSIBLE FOR THE PARTIES TO ENTER INTO TRANSACTIONS EVEN WITHOUT THE HELP OF BROKERS. THEREFORE, IT IS NOT POSSIBLE TO HOLD THAT THE TRANSACTIONS REPORTED BY THE ASSESSEE WERE QUITE SHAM ON THE LEGAL PROPOSITION ARRIVED AT BY THE CIT(A) THAT OFF - MARKET TRANSACTIONS ARE NOT PERMISSIBLE. THE ASSESSEE HAS STATED THAT THE TRANSACTIONS WERE MADE WITH THE HELP OF PROFESSIONAL MEDIAT ORS WHO ARE EXPERTS IN OFF - MARKET TRANSACTIONS. 70.4 WHEN THE TRANSACTIONS WERE OFF - MARKET TRANSACTIONS, THERE IS NO RELEVANCE IN SEEKING DETAILS OF SHARE TRANSACTIONS FROM STOCK EXCHANGES. SUCH ATTEMPTS WOULD BE FUTILE. STOCK EXCHANGES CANNOT GIVE DETAILS OF TRANSACTIONS ENTERED INTO BETWEEN THE PARTIES OUTSIDE THEIR FLOOR. THEREFORE, THE RELIANCE PLACED BY THE ASSESSING AUTHORITY ON THE COMMUNICATIONS RECEIVED FROM THE STOCK EXCHANGES THAT THE PARTICULARS OF SHARE TRANSACTIONS ENTERED INTO BY THE ASSESSEE WERE NOT AVAILABLE IN THEIR RECORDS, IS OUT OF PLACE. THERE IS NO EVIDENTIAL VALUE FOR SUCH RELIANCE PLACED BY THE ASSESSING AUTHORITY. THE ASSESSEE HAD MADE IT VERY CLEAR THAT THE TRANSACTIONS WERE NOT CONCLUDED ON THE FLOOR OF THE STOCK EXCHANGE. THE MA TTER BEING SO, THERE IS NO PROBATIVE VALUE FOR THE NEGATIVE REPLIES SOLICITED BY THE ASSESSING AUTHORITY FROM THE RESPECTIVE STOCK EXCHANGES. WE ARE OF THE CONSIDERED VIEW THAT THE MATERIALS COLLECTED BY THE ASSESSING AUTHORITY FROM THE STOCK EXCHANGES ARE NOT VALID TO DISPEL OR DISBELIEVE THE CONTENTIONS OF THE ASSESSEE.' 9.3 THE MUMBAI TRIBUNAL ORDER IN THE CASE OF SHRI MUKESH MORALIA HAS BEEN UPHELD AND CONFIRMED BY THE BOMBAY HIGH COURT IN TAX APPEAL NO.456 OF 2007. THEREFORE, IN VIEW OF FOREGOING, THE SHARES PURCHASED THROUGH OFF - MARKET TRADE THE SAME CANNOT BE CONSIDERED NON - GENUINE IGNORING THE FACTS THAT THE PURCHASES ARE ACCEPTED BY DEPARTMENT IN PRECEDING YEAR BY TWO ASSESSMENTS FOR THE SAME YEAR AND THE PAYMENTS OF PURCHASES AND SALES ARE EFFECTED BY A/C PAYEE CHEQUES. 9.4 FURTHER IN THE CASE OF SMT. JAYA VINEET AGARWAL FOR A. Y. 2004 - 05, LD. CIT(A) - XI, AHMEDABAD VIDE ITS APPEAL ORDER NO. CIT(A) - XI/437/ACIL CIR. 6(5)/11 - 12 DATED 07/05/2012, ON SIMILAR FACTS, HAS ALSO DELETED ADDITION U/S. 69 OF TH E I.T. ACT, 1961 ON THE FACTS AND CIRCUMSTANCES RELATING TO THE STATEMENT OF SHRI MUKESH CHOKSI. THIS ORDER HAS BEEN ACCEPTED BY THE REVENUE. THE PARTIES TO SHARE TRANSACTIONS AND FACTS BEING SIMILAR, LD. CIT(A) HAS TAKEN A CORRECT VIEW IN DELETING THE ADD ITIONS. 9.5 LD. AO, THOUGH CONFIRMED THE SALE OF 30,000 SHARES OF NEPTUNE SECURITIES P. LTD, HOWEVER FOR PART OF 20,000 SALE OF SHARES HELD TO BE NON - GENUINE AND RS. 13,17,873 WERE ADDED U/S 68 ON PROPORTIONATE BASIS. IT LEADS TO A CONTRADICTION AND DES PITE THE FACTS THAT BSE HAS CONFIRMED TRANSACTION OF 30,000 SHARES. IN THE ABSENCE OF ANY INQUIRY FROM VIMLA EXIM P. LTD WHO IS A UNDISPUTEDLY A MEMBER OF AHMEDABAD STOCK EXCHANGE NO ADVERSE INFERENCE CAN BE DRAWN. 9.6 IN VIEW OF THESE GLARING FACTS, TH E ASSESSMENT OF SMT. JAYA AGRAWAL AND THE FACT THAT THE RELEVANT PURCHASES FOR AY 2004 - 05 HAVE BEEN HELD TO BE GENUINE, WE SEE NO INFIRMITY IN THE ORDER OF LD. CIT(A) IN DELETING THESE ADDITIONS. ON THE ISSUES OF SHRI CHOKSHI, MAHASAGAR SECURITIES PVT. LTD . AND GOLDSTAR FINVEST PVT. LTD., A CATENA OF JUDGMENTS FROM ITAT, MUMBAI AND AHMEDABAD IS AVAILABLE IN FAVOUR OF THE ASSESSEE WHICH VIEW ALSO STANDS CONFIRMED BY HON BLE BOMBAY HIGH COURT IN THE CASE OF SHRI MUKESH MORALIA. RESPECTFULLY FOLLOWING THESE JU DICIAL PRECEDENTS AND FACTS I.T.A NO S . 796 & 797 /AHD/20 16 A.Y. 200 4 - 05 PAGE NO PRAHLAD S. MEHTA & NAJUBEN RAJPAL MEHTA VS. ITO 8 AND CIRCUMSTANCES AS MENTIONED ABOVE, WE UPHOLD THE ORDER OF LD. CIT(A). REVENUE S GROUND STANDS DISMISSED. WE FURTHER FIND THAT THE DECISION OF THE CO - ORDINATE BENCH OF ITAT WAS CONFIRMED BY THE HON BLE HIGH COURT OF GUJARAT VIDE TAX APPEAL NO. 645 OF 2017 DATED 4 TH SEPTEMBER, 2017. THE LD. COUNSEL HAS ALSO PLACED RELIANCE ON THE DECISION OF THE CO - ORDINATE BENCH OF THE ITAT VIDE ITA NOS. 810 TO 815,922 TO 926/AHD/2015 IN THE CASE OF PRATIK SURYAKANT SHAH & OTHERS ON THE IDEN TICAL ISSUE . THE RELEVANT PART OF THE DECISION IS REPRODUCED AS UNDER : - 13. HAVING HEARD THE RIVAL CONTENTIONS, WE HAVE CAREFULLY PERUSED THE ORDERS OF THE AUTHORITIES BELOW. AS MENTIONED ELSEWHERE, WE HAVE CONSIDERED THE FACTS IN ITA NO.810/AHD/2015. WE FIND THAT THE ASSESSEE HAD PURCHASED 3000 SHARES OF TELANT INFO LTD FROM M/S. MAHASAGAR SECURITIES PVT LTD ON APRIL 2004. THE CONSIDERATION WAS PAID AND THE PAYMENT OF CONSIDERATION IS NOT IN DISPUTE. THE SHARES OF TELANT INFO LTD WERE LISTED IN THE BOMBA Y STOCK EXCHANGE AT THAT POINT OF TIME. THE SHARES SO PURCHASED WERE SOLD THROUGH M/S. ALLIANCE INTERMEDIATERIES & NETWORK PVT LTD AND THE CONSIDERATION WAS RECEIVED BY CHEQUE. IT WOULD BE PERTINENT TO MENTION HERE THAT THOUGH THE SHARES WERE PURCHASED IN PHYSICAL FORM, THE SAME WERE SENT TO THE COMPANY WITH SHARE APPLICATION FORM AND THE SHARES WERE TRANSFERRED BY THE COMPANY IN THE NAME OF THE PURCHASER. THEREAFTER, THE SHARES WERE TRANSFERRED IN THE DEMAT ACCOUNT, FROM WHERE THEY WERE SOLD. IT IS NOT THE CASE OF THE REVENUE THAT THE CONSIDERATION PAID BY THE ASSESSEE AT THE TIME OF PURCHASE OF SHARES WAS RECEIVED BACK IN CASH, NOR IT IS THE CASE OF THE REVENUE THAT THE SALE CONSIDERATION RECEIVED BY THE ASSESSEE WAS RETURNED BACK IN CASH. IT IS ALSO NOT T HE CASE OF THE REVENUE THAT THE SHARES IN QUESTION ARE STILL LYING WITH THE ASSESSEE, NOR IT IS THE CASE OF THE REVENUE THAT THE AMOUNTS RECEIVED BY THE ASSESSEE ON SALE OF THE SHARES IS MORE THAN WHAT IS DECLARED BY THE ASSESSEE. 14. THE ENTIRE ASSESSMENT IS BASED UPON THE STATEMENT OF SHRI MUKESH CHOKSI. IT IS AN UNDISPUTED FACT THAT NEITHER A COPY OF THE STATEMENT WAS SUPPLIED TO THE ASSESSEE NOR ANY OPPORTUNITY OF CROSS - EXAMINATION WAS GIVEN BY THE ASSESSING OFFICER/CIT(A). THE HON'BLE SUPREME COURT IN THE ITA NOS. 810 TO 815, 922 TO 926/AHD/2015 SHRI PRATIK SURYAKANT SHAH & OTHERS - TOTAL 11 APPLS AYS 2006 - 07 & 2008 - 09 CASE OF ANDAMAN TIMBER INDUSTRIES IN CIVIL APPEAL NO. 4228 OF 2006 WAS SEIZED WITH THE FOLLOWING ACTION OF THE TRIBUNAL: - '6. THE PLEA O F NO CROSS EXAMINATION GRANTED TO THE VARIOUS DEALERS WOULD NOT HELP THE APPELLANT CASE SINCE THE EXAMINATION OF THE DEALERS WOULD NOT BRING OUT ANY MATERIAL WHICH WOULD NOT BE IN THE POSSESSION OF THE APPELLANT THEMSELVES TO EXPLAIN AS TO WHY THEIR EX FAC TORY PRICES REMAIN STATIC. SINCE WE ARE NOT UPHOLDING AND APPLYING THE EX FACTORY PRICES, AS WE FIND THEM CONTRAVENED AND NOT NORMAL PRICE AS ENVISAGED UNDER SECTION 4(1) , WE FIND NO REASON TO DISTURB TH E COMMISSIONERS ORDERS.' 15. THE HON'BLE APEX COURT HELD AS UNDER: - 'ACCORDING TO US, NOT ALLOWING THE ASSESSEE TO CROSS - EXAMINE THE WITNESSES BY THE ADJUDICATING AUTHORITY THOUGH THE STATEMENTS OF THOSE WITNESSES WERE MADE THE BASIS OF THE IMPUGNED ORDER IS A SERIOUS FLAW WHICH MAKES THE ORDER NULLITY INASMUCH AS IT AMOUNTED TO VIOLATION OF PRINCIPLES OF NATURAL JUSTICE BECAUSE OF WHICH THE ASSESSEE WAS ADVERSELY AFFECTED. IT IS TO BE BORNE IN MIND THAT THE ORDER OF THE COMMISSIONER WAS BASED UPON THE STAT EMENTS GIVEN BY THE AFORESAID TWO I.T.A NO S . 796 & 797 /AHD/20 16 A.Y. 200 4 - 05 PAGE NO PRAHLAD S. MEHTA & NAJUBEN RAJPAL MEHTA VS. ITO 9 WITNESSES. EVEN WHEN THE ASSESSEE DISPUTED THE CORRECTNESS OF THE STATEMENTS AND WANTED TO CROSS - EXAMINE, THE ADJUDICATING AUTHORITY DID NOT GRANT THIS OPPORTUNITY TO THE ASSESSEE. IT WOULD BE PERTINENT TO NOTE THAT IN THE IMPUGNED ORDER PASSED BY THE ADJUDICATING AUTHORITY HE HAS SPECIFICALLY MENTIONED THAT SUCH AN OPPORTUNITY WAS SOUGHT BY THE ASSESSEE. HOWEVER, NO SUCH OPPORTUNITY WAS GRANTED AND THE AFORESAID PLEA IS NOT EVEN DEALT WITH BY THE ADJUDICATING AUTHORITY. AS FAR AS THE TRIBUNAL IS CONCERNED, WE FIND THAT REJECTION OF THIS PLEA IS TOTALLY UNTENABLE. THE TRIBUNAL HAS SIMPLY STATED THAT CROSS - EXAMINATION OF THE SAID DEALERS COULD NOT HAVE BROUGHT OUT ANY MATERIAL WHICH WOULD NOT BE IN POSSESSION OF THE APPELLANT THEMSELVES TO EXPLAIN AS TO WHY THEIR EX - FACTORY PRICES REMAIN STATIC. IT WAS NOT FOR THE TRIBUNAL TO HAVE GUESS WORK AS TO FOR WHAT PURPOSES THE APPELLANT WANTED TO CROSS - EXAMINE THOSE DEALERS AND WHAT EXTRACTION THE APPELLANT WANTED FROM THEM. AS MENTIO NED ABOVE, THE APPELLANT HAD CONTESTED THE TRUTHFULNESS OF THE STATEMENTS OF THESE TWO WITNESSES AND WANTED TO DISCREDIT THEIR TESTIMONY FOR WHICH PURPOSE IT WANTED TO AVAIL THE OPPORTUNITY OF CROSS - EXAMINATION. THAT APART, THE ADJUDICATING AUTHORITY SIMPL Y RELIED UPON THE PRICE LIST AS MAINTAINED AT THE DEPOT TO DETERMINE THE PRICE FOR THE PURPOSE OF LEVY OF EXCISE DUTY. WHETHER THE GOODS WERE, IN FACT, SOLD TO THE SAID DEALERS/WITNESSES AT THE PRICE WHICH IS MENTIONED IN THE PRICE LIST ITSELF COULD BE THE SUBJECT MATTER OF CROSS - EXAMINATION. THEREFORE, IT WAS NOT FOR THE ADJUDICATING AUTHORITY TO PRESUPPOSE AS TO WHAT COULD BE THE SUBJECT MATTER ITA NOS. 810 TO 815, 922 TO 926/AHD/2015 SHRI PRATIK SURYAKANT SHAH & OTHERS - TOTAL 11 APPLS AYS 2006 - 07 & 2008 - 09 OF THE CROSS - EXAMINATION AND MAKE THE REMARKS AS MENTIONED ABOVE. WE MAY ALSO POINT OUT THAT ON AN EARLIER OCCASION WHEN THE MATTER CAME BEFORE THIS COURT IN CIVIL APPEAL NO. 2216 OF 2000, ORDER DATED 17.03.2005 WAS PASSED REMITTING THE CASE BACK TO TH E TRIBUNAL WITH THE DIRECTIONS TO DECIDE THE APPEAL ON MERITS GIVING ITS REASONS FOR ACCEPTING OR REJECTING THE SUBMISSIONS. IN VIEW THE ABOVE, WE ARE OF THE OPINION THAT IF THE TESTIMONY OF THESE TWO WITNESSES IS DISCREDITED, THERE WAS NO MATERIAL WITH TH E DEPARTMENT ON THE BASIS OF WHICH IT COULD JUSTIFY ITS ACTION, AS THE STATEMENT OF THE AFORESAID TWO WITNESSES WAS THE ONLY BASIS OF ISSUING THE SHOW CAUSE WE, THUS, SET ASIDE THE IMPUGNED ORDER AS PASSED BY THE TRIBUNAL AND ALLOW THIS APPEAL.' 16. ON THE STRENGTH OF THE AFOREMENTIONED DECISION OF THE HON'BLE SUPREME COURT, THE ASSESSMENT ORDER HAS TO BE QUASHED. 17. FOR THE SAKE OF THE COMPLETENESS OF THE ADJUDICATION, EVEN ON FACTS OF THE CASE, THE ORDERS OF THE AUTHORITIES BELOW CANNOT BE ACCEPTED. THER E IS NO DENYING THAT CONSIDERATION WAS PAID WHEN THE SHARES WERE PURCHASED. THE SHARES WERE THEREAFTER SENT TO THE COMPANY FOR THE TRANSFER OF NAME. THE COMPANY TRANSFERRED THE SHARES IN THE NAME OF THE ASSESSEE. THERE IS NOTHING ON RECORD WHICH COULD SUGG EST THAT THE SHARES WERE NEVER TRANSFERRED IN THE NAME OF THE ASSESSEE. THERE IS ALSO NOTHING ON RECORD TO SUGGEST THAT THE SHARES WERE NEVER WITH THE ASSESSEE. ON THE CONTRARY, THE SHARES WERE THEREAFTER TRANSFERRED TO DEMAT ACCOUNT. THE DEMAT ACCOUNT WAS IN THE NAME OF THE ASSESSEE, FROM WHERE THE SHARES WERE SOLD. IN OUR UNDERSTANDING OF THE FACTS, IF THE SHARES WERE OF SOME FICTITIOUS COMPANY WHICH WAS NOT LISTED IN THE BOMBAY STOCK EXCHANGE/NATIONAL STOCK EXCHANGE, THE SHARES COULD NEVER HAVE BEEN TRAN SFERRED TO DEMAT ACCOUNT. SHRI MUKESH CHOKSI MAY HAVE BEEN PROVIDING ACCOMMODATION ENTRIES TO VARIOUS PERSONS BUT SO FAR AS THE FACTS OF THE CASE IN HAND SUGGEST THAT THE TRANSACTIONS WERE GENUINE AND THEREFORE, NO ADVERSE INFERENCE SHOULD BE DRAWN. ITA NO S. 810 TO 815, 922 TO 926/AHD/2015 SHRI PRATIK SURYAKANT SHAH & OTHERS - TOTAL 11 APPLS AYS 2006 - 07 & 2008 - 09 18. IN THE LIGHT OF THE DECISIONS OF THE HON'BLE SUPREME COURT IN THE CASE OF ANDAMAN TIMBER INDUSTRIES (SUPRA) AND CONSIDERING THE FACTS IN TOTAL ITY, THE CLAIM OF THE ASSESSEE CANNOT BE DENIED ON THE BASIS OF PRESUMPTION AND SURMISES IN RESPECT OF PENNY STOCK BY DISREGARDING THE DIRECT EVIDENCES ON RECORD RELATING TO THE SALE/PURCHASE TRANSACTIONS IN SHARES SUPPORTED BY BROKER'S CONTRACT NOTES, CON FIRMATION OF RECEIPT OF SALE PROCEEDS THROUGH REGULAR BANKING CHANNELS AND THE DEMAT ACCOUNT. 19. AS MENTIONED ELSEWHERE AND AS AGREED BY THE REPRESENTATIVES OF BOTH THE SIDES; SINCE THE FACTS ARE COMMON IN ALL THE IMPUGNED APPEALS, ALL THE APPEALS BY THE ASSESSEES ARE ALLOWED. THE I.T.A NO S . 796 & 797 /AHD/20 16 A.Y. 200 4 - 05 PAGE NO PRAHLAD S. MEHTA & NAJUBEN RAJPAL MEHTA VS. ITO 10 ASSESSING OFFICER IS DIRECTED TO TREAT THE SURPLUS AS LONG TERM CAPITAL GAINS AND ALLOW THE EXEMPTION AS CLAIMED BY THE ASSESSEES. 20. IN THE RESULT, ALL THE APPEALS FILED BY THE ASSESSEES ARE ALLOWED . RESPECTFULLY FOLLOWING TH E DECISION OF THE CO - ORDINATE BENCH OF THE ITAT AS SUPRA IN THIS CASE , THE APPEAL OF THE ASSESSEE IS ALLOWED. 7 . IN RESPECT OF G ROUND OF APPEAL OF THE ASSESSEE REGARDING VALIDITY OF RE - ASSESSMENT U/S. 147/148 THE LD. COUNSEL HA S RETR EATED THE SAME ARGUME NT WHICH WAS PUT BEFORE THE LD. CIT(A) THAT THE ASSESSING OFFICER ISSUED NOTICED U/S. 148 BEYOND THE PERIOD OF FOUR YEARS WHICH WAS NOT SUSTAINABLE. IT WAS ALSO STATED THAT ASSESSEE HAS FURNISHED ALL THE DETAILS REGARDING PURCHASE OF SHARES LIKE P URCHASE CONTRAC T , COPY OF BANK STATEMENT , SALE CONTRACT, BILL FOR SALE OF SHARE OF THE BROKER, DETAILS OF CHEQUE PAYMENT RECEIVED FOR SALE PROCEEDS, COPY OF BANK STATEMENT, STATEMENT WHERE THE SALE PROCEEDS WERE DEPOSITED , DELIVERY OF SHARE FROM DEMAT A/C OF THE ASSESSEE ETC. ON OTHER HAND , LD. DEPARTMENTAL REPRESENTATIVE SUPPORTED THE ORDER OF THE LD. CIT(A). WE OBSERVED THAT INFORMATION WAS RECEIVED ON THE BASIS OF SEARCH AND SEIZURE ACTION U/S. 132 OF THE ACT CARRIED OUT IN THE GROUP CASES OF M/S, MAHASAG AR SECURITIES PVT. LTD. (NOW KNOWN AS ALANG SECURITIES SECURITY PVT. LTD.) WHEREIN IN THE COURSE OF SEARCH SHRI MUKESH CHOKSHI, WHO WAS MANAGING AND CONTROLLING THE SAID GROUP HAD ADMITTED IN HIS STATEMENT THAT THE GROUP WAS ENGAGED IN PROVIDING BOGUS ENTRIES OF SPECULATION PROFIT/LOSS, COMMODITIES PROFIT/LOSS. THE ASSESSING OFFICER HAS INITIATED ACTION U/S. 147 BY ISSUING NOTICE U/S. 148 OF THE ACT AFTER ANALYZING THE I.T.A NO S . 796 & 797 /AHD/20 16 A.Y. 200 4 - 05 PAGE NO PRAHLAD S. MEHTA & NAJUBEN RAJPAL MEHTA VS. ITO 11 INFORMATION RECEIVED FROM THE INVESTIGATION WING ON THE BASIS OF ACTION CARRIED OUT U/S. 132 AS THE MAIN PERSON HAS ADMITTED THAT THESE COMPANIES WERE NOT DOING GENUINE BUSINESS . AFTER CONSIDERING THE ABOVE FACTS AND FINDINGS WE OBSERVED THAT REOPENING OF THE CASE ASSESSEE WAS INITIATED ON THE BASIS OF SPECIFIC INFORMATION AND ADM I SSION OF SHRI MUKESH CHO KSHI AS ELABORATED SUPRA IN THIS ORDER. THEREFORE, WE DO NOT FIND ANY ERROR IN THE FINDINGS OF THE LD. CIT(A) ON THIS ISSUE. ACCORDINGLY , THIS GROUND OF THE ASSESSEE IS DISMISSED. IN THE RESU LT, THIS GROUND OF APPEAL IS DISMISSED . 8 . THE ASSESSEE S GROUND NO. 9 IS RELAT ED TO CHARGING OF INTEREST U/S. 234B OF THE ACT . W E FIND NO MERIT IN TH IS GROUND OF APPEAL OF THE ASSESSEE AS CHARGING OF INTEREST U/S. 234A B & C OF THE ACT IS CONSEQUENTLY AND MANDATORY , THEREFORE , THIS GROUND OF THE APPEAL OF THE ASSESSE IS DISMISSED. 9 . GROUND OF APPEAL NO. 10 IS GENERAL WHICH DOES NOT REQUIRE ANY ADJUDICATION. 10. IN THE RESULT, BOTH THE APPEAL S OF THE ASSESSEES ARE PARTLY ALLOWED. ORDER PR ONOUNCED IN THE OPEN C OURT ON 16 - 11 - 201 7 SD/ - SD/ - ( MAHAVIR PRASAD ) ( AMARJIT SINGH ) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD : DATED 16/11 /2017 I.T.A NO S . 796 & 797 /AHD/20 16 A.Y. 200 4 - 05 PAGE NO PRAHLAD S. MEHTA & NAJUBEN RAJPAL MEHTA VS. ITO 12 / COPY OF ORDER FORWARDED TO: - 1. ASSESSEE 2. REVENUE 3. CONCERNED CIT 4. CIT (A) 5. DR, ITAT, AHMEDABAD 6. GUARD FILE. BY ORDER/ , / ,