2021 (5) TMI 286 - HC - Income Tax

Bogus LTCG - Penny stock purchases - Tribunal remitting the issue back to the file of the Assessing Officer wherein the onus has been shifted to the Revenue with a direction that the Assessing Officer is to bring on record the role of the assessee in promoting the company and the relation of the assessee, if any with that of the promoters and role of inflating of prices, etc. - HELD THAT - An identical issue has been considered by a Division Bench of this Court in the case of CIT Vs. Manish D.Jain HUF 2020 (12) TMI 740 - MADRAS HIGH COURT and held Not only the Assessing Officer, but also the CIT(A) examined the modus operandi of the assessee and held that the shares were purchased through off market and not through Stock Exchange and that the selling rates were artificially hiked later on. The above findings have not been set aside by the Tribunal and there is no reason for the Tribunal to remand the matter to the Assessing Officer for a fresh consideration. - Issue has been answered in favour of the Revenue.

Summary

Issues:
- Appeal filed by Revenue challenging order of Income Tax Appellate Tribunal for assessment year 2010-11.
- Substantial questions of law regarding remittance of issue back to Assessing Officer and burden of proof on Revenue.
- Consideration of similar issue by Division Bench in a previous case.
- Decision to set aside Tribunal's order and rule in favor of Revenue.

Analysis:
The judgment pertains to an appeal filed by the Revenue under Section 260A of the Income Tax Act, 1961, challenging the order dated 11.12.2019 made by the Income Tax Appellate Tribunal for the assessment year 2010-11. The appeal was admitted based on substantial questions of law, primarily questioning the Tribunal's decision to remit the issue back to the Assessing Officer, shifting the burden of proof to the Revenue. The Court considered the argument presented by the Senior Standing Counsel for the appellant/Revenue, highlighting a previous decision by a Division Bench in the case of CIT Vs. Manish D.Jain [HUF]. The Counsel emphasized that the issue in question had been resolved in favor of the Revenue in the mentioned case, which was not disputed.

In light of the precedent set by the Division Bench's decision, the Court allowed the tax case appeal, setting aside the Tribunal's order. The substantial questions of law raised were answered in favor of the Revenue, indicating a clear ruling in alignment with the principles established in the previous case. The judgment showcases the importance of legal precedents and consistency in interpreting and applying the law, ensuring uniformity in decision-making and upholding the rule of law in tax matters.