2013 (5) TMI 1005 - AT - Income Tax

Summary

Issues involved: Appeal against order u/s. 143(3) of the Income-tax Act, 1961 for Assessment Year 2004-05, condonation of delay in filing appeal, addition of cash credit u/s. 68 on sale of shares.

Condonation of Delay:
The appeal of revenue was time-barred by 3 days, and a condonation petition was filed. The delay was condoned as the assessee did not object, and the appeal was admitted for hearing.

Addition of Cash Credit u/s. 68:
The revenue raised grounds related to the addition of cash credit u/s. 68 on the sale of shares worth Rs. 17,14,240. The AO treated the gains as unexplained cash credit due to the broker's suspension for share manipulation. However, the CIT(A) directed to treat the profit as Long Term Capital Gain (LTCG) based on supporting documents and precedents.

Arguments and Decision:
The revenue argued that the transactions were fraudulent, but the assessee provided evidence of purchase and sale of shares through registered brokers. The Assessing Officer's decision was based on presumptions without evidence contrary to the transactions. The CIT(A) followed the decision of the Calcutta High Court and granted relief based on substantiated documents. The Tribunal upheld the CIT(A)'s decision, citing the assessee's substantiation of the share transactions with necessary documents and the Calcutta High Court's precedent.

Conclusion:
The appeal of revenue was dismissed, and the Tribunal found the CIT(A)'s decision on the issue of addition of cash credit u/s. 68 to be appropriate and in line with legal precedents.