2009 (1) TMI 303 - AT - Income Tax

Unexplained cash credit - addition u/s 68 - off-market transactions of shares - purchase and sale of shares through registered brokers of CSE through bank entries have been reflected in the books of account and the brokers have confirmed the transactions. HELD THAT - It transpires that in a transaction like off-market transactions any enquiry from the stock exchange will not yield result in favour of the Revenue. The Revenue has to see whether the sale has been effected or not as per the documents and as per the acceptance and admission of the respective stock brokers. As it has been assertively argued by the ld AR in this case that both the stock brokers had not denied the transactions and the capital gain has been shown the AO simply by casting doubt for alleged purchase of house property cannot treat the same as cash credit and cannot take the same in his cash credit. In our considered opinion suspicion cannot replace the real evidential document. Simply by arguing it to be a case of manipulation the Revenue is not supposed to succeed in their contention without proper evidence. we allow the assessee s second appeal.

Summary

The Appellate Tribunal ITAT CALCUTTA-B, consisting of G. D. AGARWAL and N. L. DASH, issued an order in response to an appeal by the assessee against the decision of the CIT(A)-Siliguri. The primary issue at hand was the invocation of section 68 of the IT Act by the authorities, treating the capital gain of Rs. 9,68,972 as unexplained cash credit. The assessee's representative argued that the transactions were genuine, supported by detailed documentation, and conducted through registered brokers of the Calcutta Stock Exchange. The AO, however, questioned the authenticity of the transactions, as the CSE denied their existence in their online trading mechanism. The representative cited tribunal cases to support the legitimacy of off-market transactions and the irrelevance of stock exchange records in such cases. Additionally, the representative referenced the movement of shares in the de-mat account, bank transactions, and other supporting documents to validate the transactions. The Tribunal ultimately ruled in favor of the assessee, emphasizing that suspicion alone cannot override concrete evidence, and the