SONAM RAJESH RATERIA,MUMBAI V. THE INCOME TAX OFFICER, WARD - 23(3)(6), MUMBAI

ITA 1040/MUM/2025

AI Insights

This case involves an appeal by Ms. Sonam Rajesh Rateria against the order of the Addl./Joint Commissioner of Income Tax (Appeals), which had affirmed the additions made by the Assessing Officer regarding the sale of shares. The Assessee had sold 11,000 shares of PSIT Infra and Services Ltd., claiming the gains as exempt under section 10(38) of the Act, which was disallowed by the AO. The Tribunal examined the documentation provided by the Assessee, including purchase and sale invoices, Demat statements, and bank statements, and found no evidence of share rigging or other malpractices. The Tribunal concluded that the Assessee had met her burden of proof under section 68 and thus allowed the appeal.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 313077 (ITAT-MUMBAI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-04-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2015-2016
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MANOJ KUMAR SINHA; LD.
• Assessee Lawyers: RITESH JAIN; LD
• Section: 143(3); 68; 69C

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCH “SMC”, MUMBAI BEFORE SHRI NARENDER KUMAR CHOUDHRY, JUDICIAL MEMBER ITA No.1040/M/2025 Assessment Year: 2015-16 Ms. Sonam Rajesh Rateria, 401-402, B- Wing, Ramji House, Jambulwadi, Kalbadevi Mumbai-400002 PAN: AHAPR6432J Vs. Income Tax Officer, Ward-23(3)(6), 6th Floor, Piramal Chambers, Lalbaug, Parel, Maharashtra -400012 (Appellant) (Respondent) Present for: Assessee by : Shri Ritesh Jain, Ld. A.R. Revenue by : Shri Manoj Kumar Sinha,Ld. Sr. D.R. Date of Hearing : 09 .04 .2025 Date of Pronouncement : 28 .04 .2025 O R D E R Per : Narender Kumar Choudhry, Judicial Member: This appeal has been preferred by the Assessee against the order dated 07.01.2025, impugned herein, passed by the Ld. Addl./Joint Commissioner of Income Tax (Appeals) (in short “Ld. Addl./Joint Commissioner”) u/s 250 of the Income Tax Act, 1961 (in short ‘the Act’) for the A.Y. 2015-16. ITA No.1040/M/2025 Ms. Sonam Rajesh Rateria 2 2. In this case, the Assessee had initially purchased 3125 shares of Parag Shilp Swift IT Infrastructure & Services Pvt. Ltd. (PSIT Infra and Services Ltd.) @ Rs.40 per share. Subsequently, such shares were splitted into Rs.1/- from face value of Rs.10 and therefore the same became 31250 shares. The said shares were subsequently got demoralized. Thereafter the Assessee during the AY under consideration on dated 18.12.2014 , sold 11000 shares out of 31250, on a consideration of Rs.9,98,250/- and consequently earned long term capital gain of Rs.9,54,250/- and claimed the same, as exempt u/s 10(38) of the Act. 3. The Assessing Officer (AO) disallowed the said claim of the Assessee vide assessment order dated 20.12.2017 u/s 143(3) of the Act and made the additions of Rs.9,98,250/- being sale price of such shares and Rs.29,947/- being commission paid @ 3% of Rs.9,98,250/- and added the same in the income of the Assessee as un-explained expenditure u/s 69C of the Act. 4. The Assessee, being aggrieved, challenged the said additions before the Ld. Addl./Joint Commissioner, however, of no avail, as the Ld. Addl./Joint Commissioner affirmed both the additions by dismissing the appeal of the Assessee. 5. The Assessee, being aggrieved, challenged the aforesaid additions by filing present appeal. ITA No.1040/M/2025 Ms. Sonam Rajesh Rateria 3 6. Having heard the parties and given thoughtful considerations to the peculiar facts and circumstances of the case and rival claims of the parties. It is admitted fact that the Assessee has been regularly dealing in shares and securities and in order to discharge her onus cast u/s 68 of the Act qua transaction of scrip in hand, duly filed the relevant documents, such as purchase invoice, sale invoice, Demat statement and bank statement etc. which are not in controversy. Admittedly, no role of rigging of shares, has been attributed to the Assessee and no order has ever been passed against the Assessee by the SEBI or other Investigating Agency. As the Assessee by producing the relevant documents mentioned above, has been able to discharge her onus cast u/s 68 of the Act and it is fact that the sale and purchase transactions have been routed through banking channels and the shares were held for a period of more than one year and sold through Bombay Stock Exchange platform and therefore in the considered view of this Court, the addition u/s 68 of the Act, is un-sustainable. Consequently, the addition of Rs.9,98,250/- is deleted. 7. Coming to the addition of Rs. 29,947/- u/s 69C of the Act, as this Court has deleted the substantive addition, hence this addition u/s 69C of the Act, does not survive. Consequently, the same is also deleted. ITA No.1040/M/2025 Ms. Sonam Rajesh Rateria 4 8. In the result, the appeal filed by the Assessee is allowed. Order pronounced in the open court on 28.04.2025. Sd/- (NARENDER KUMAR CHOUDHRY) JUDICIAL MEMBER * Kishore, Sr. PS Copy to: The Appellant The Respondent The CIT, Concerned, Mumbai The DR Concerned Bench //True Copy// By Order Dy/Asstt. Registrar, ITAT, Mumbai. "