Well Known Financial Services P. Ltd., Kolkata V. ITO, Ward - 6(4), Kolkata, Kolkata

ITA 981/KOL/2010

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 83022 (ITAT-KOLKATA)
• Duration Of Justice: 4 year(s) 2 month(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 01-08-2014
• Appeal Filed By: Assessee
• Bench Allotted: C
• Assessment Year: 2006-2007
• Appeal Filed On: 12-05-2010
• Court: TRIBUNAL
• Department Lawyers: DAVID Z CHAWNGTHU CITSR

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, BENCH C , KOLKATA [BEFORE HONBLE SRI P.K.BANSAL, AM & HONBLE SRI GEORGE MATHAN, JM] ITA NO.981/KOL/2010 ASSESSMENT YEAR : 2006-07 ( APPELLANT ) - (RESPONDENT) WELL KNOWN FINANCIAL SERVICES I.T.O., WARD-6(4), P.LTD.KOLKATA -VERSUS- KOLKATA (PAN : AAACW4790 J) FOR THE APPELLANT: SHRI SUBASH AGARWAL, ADVOCATE FOR THE RESPONDENT: SHRI DAVID Z.CHAWNGTHU, ADDL.CIT,SR.DR DATE OF HEARING : 25.07.2014 DATE OF PRONOUNCEMENT :.1.8.2014. ORDER PER SHRI P.K.BANSAL, AM THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER OF LD. CIT(A)-VI, KOLKATA DATED 30.03.2010 FOR A.YR.2006-07. 2. THE ONLY ISSUE INVOLVED IN THIS APPEAL RELATES TO DISAL LOWANCE OF THE LOSS OF RS.3,99,910/- ARISING FROM THE SHARE TRANSACTION. 3. THE FACTS RELATING TO THIS GROUND ARE THAT THE AO NOTED THAT THE ASSESSEE HAS INCURRED LOSS DUE TO VALUATION OF STOCK IN RESPECT OF PURCHASE OF SHARES OF SANGOTRI CONSTRUCTION LTD.. IN THE COURSE OF VERIFICATION OF THE PAYMENTS AND DELIVERY OF SHARES IT WAS FOUND THAT THE SALE PROCEED OF 17800 SHARES OF RICH FIELD FINANCIAL SERVICES LTD. AMOUNTING TO RS.7,82,310/-WERE UTILIZED TO PUR CHASE THE SHARES OF SANGOTRI CONSTRUCTION LTD.. THESE SHARES APPEARED IN THE DEM AT ACCOUNT ON 2.11.06 WHILE THE SAME WERE PURCHASED ON 11.5.2005. THE SHARES OF RIC H FIELD FINANCIAL SERVICES LTD. WERE SOLD ON 18.4.2005 WHILE THE SHARES WERE DELIVE RED ON 22.01.2007 TO THE BROKER AND APPEARED IN THE DEMAT ACCOUNT OF THE ASSESEE ON 31.03.2006. THE AO TREATED THE LOSS TO BE BOGUS AND THE MATTER WENT TO THE LD. CIT (A). THE LD.CIT(A) DISMISSED THE GROUND TAKEN BY THE ASSESSEE BY OBSERVING AS UNDER :- ITA NO.981/KOL/2010 WELL KNOWN FIANNCIAL SERV ICES (P) LTD., A.YR.2006-07 2 I HAVE GONE THROUGH THE SUBMISSIONS OF THE APPELLA NT AND ALSO THE ORDER OF THE A.O. DURING THE COURSE OF ASSESSMENT PROCEEDINGS THE A.R . DID NOT PRODUCE DEMAT ACCOUNT. THE AO COLLECTED INFORMATION FROM THE SHARE HOLDERS S.B.BHUTRA AND CO. REGARDING THE LATE DELIVERY OF SHARES THE BROKER STATED THAT SHAR ES OF RICH FIELD FINANCIAL SERVICES LTD. WERE DELIVERED ON 22.1.07 AND THIS IS THE REASON FO R THE LATE DELIVERY SHARES OF SANGOTRI CONSTRUCTION. THE A.O. OBSERVED THAT THE SHARES OF RICH FIELD FINANCIAL SERVICES LTD. WAS DELIVERED 3 MONTHS LATER THAN SANGOTRI CONSTRUC TION LTD. THE APPELLANT COULD NOT SATISFACTORILY EXPLAIN TO THE SHOW CAUSE NOTICE ISS UED BY THE A.O. AND SERVED ON THE ASSESSEE ON 4.12.2008. IT IS A FACT THAT PHYSICAL D ELIVERY OF THE SHARES HAD NOT BEEN AFFECTED AND THE AMOUNT INVOLVED IN SALE AND PURCHA SE OF THE SHARES WAS NOT PAID WHICH PROVES THAT THE TRANSACTION WAS DONE WITH THE CONNI VANCE OF THE BROKERS. THE LD. A.R. COULD NOT EXPLAIN THE DELAY IN THE DELIVERY OF SHAR ES THROUGH DEMAT ACCOUNT. I AGREE WITH THE OBSERVATIONS OF THE A.O. AND THE DISALLOWA NCE MADE BY THE A.O. IS CONFIRMED. THIS GROUND OF APPEAL IS DISMISSED. 4. WE HAVE HEARD THE RIVAL SUBMISSIONS AND CAREFULL Y CONSIDERED THE SAME. EVEN THOUGH THE LD. AR CONTENDED THAT THE TRANSACTION WA S DONE DURING THE YEAR BUT THERE WAS NO PROPER EVIDENCE TO SATISFY US. THE FINDINGS GIVEN BY THE AUTHORITIES BELOW ARE CORRECT. WE DO NOT FIND ANY MERIT IN THE GROUND TAK EN BY THE ASSESSEE. 5. IN THE RESULT THE APPEAL FILED BY THE ASSESSEE S TANDS DISMISSED. ORDER PRONOUNCED IN THE COURT ON 1.8.2014. SD/- SD/- [GEORGE MATHAN ] [P.K.BANSAL] JUDICIAL MEMBER ACCOUNTANT MEMBER DATE: 1.8.2014. R.G.(.P.S.) COPY OF THE ORDER FORWARDED TO: 1. WELL KNOWN FINANCIAL SERVICES P.LTD., 35, ARMENIAN STREET, 3 RD FLOOR, KOLKATA- 700001. 2 I.T.O., WARD-6(4), KOLKATA. 3 . CIT KOLKATA 4 . CIT(A)- VI, KOLKATA 5. CIT(DR), KOLKATA BENCHES, KOLKATA. TRUE COPY, BY ORDER, DEPUTY /ASST. REGISTRAR , ITAT, KOLKATA BENCHES ITA NO.981/KOL/2010 WELL KNOWN FIANNCIAL SERV ICES (P) LTD., A.YR.2006-07 3