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Issues involved: Appeal against order of Ld. CIT(A) u/s 68 of the Income Tax Act for the assessment year 2004-05.
The appellant contested the addition of Rs. 9,63,950 made by the AO u/s 68. The AO raised concerns about the genuineness of the long-term capital gain shown by the assessee on the sale of shares of Supreme Agro Products Ltd. through a broker. Discrepancies were noted between the contract note date and the payment receipt date, leading to suspicions of an accommodation entry. The AO's investigation involved contacting the broker and the Delhi Stock Exchange for verification. The Ld. CIT(A) upheld the AO's decision, prompting the appellant to appeal. The appellant argued that the AO's investigation was inadequate, with key inquiries made late in the proceedings, limiting the appellant's ability to respond effectively. The appellant requested a re-investigation of the issue. Upon review, the ITAT found fault with the AO's handling of the case. The AO's conclusions were deemed premature and lacking in thoroughness. The ITAT noted deficiencies in the summoning process and the relevance of information provided by the Delhi Stock Exchange. The ITAT concluded that a more in-depth investigation was necessary and remitted the issue back to the AO for reconsideration. Ultimately, the ITAT allowed the appeal for statistical purposes, emphasizing that its decision did not prejudice either party's case.
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