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TMI Blog2012 (6) TMI 207X X X X Extracts X X X X X X X X Extracts X X X X ..... APPEAL NOS. 8462 TO 8464 (MUM.) OF 2011 - - - Dated:- 29-3-2012 - DINESH KUMAR AGARWAL, N.K. BILLAIYA, JJ. Vikas Srivastava and Ms. Akansha Aggarwal for the Appellant. Mrs. Usha Nair for the Respondent. ORDER Dinesh Kumar Agarwal, Judicial Member These appeals preferred by the respective assessees are directed against the separate orders dated 11.10.2011, 21.12.2010 and 11.10.2011 passed by the AO u/s 143(3) read with section 144C (13) of the Income Tax Act, 1961 (the Act) for the assessment year 2008-09. Since the facts are identical and issue involved is common all these three appeals are disposed of by this common order for the sake of conveyances. 2. Briefly stated the undisputed facts, extracted from AXA World Funds A/c AXA World Funds-Talents Brick in ITA No. 8462/Mum/2011 are as under (pages 4 and 5 of Directions u/s 144C(5) dated 23.9.2011): "5. The relevant facts as discussed in the draft assessment order are as under: ( i ) The assessee has filed its return of income for A.Y. 2008-09 on 22.9.2008 declaring income of Rs. 23,54,362/-. The case was taken up for scrutiny. The assessee is a non resident corporate entity registered with Securiti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reconciliation of the data but also refused to furnish the broker's note, observed (sic by) the AO. ( ix ) As the assessee has not explained the investment in shares appearing in the AIR data, AO has proceeded to treat the total value of transactions which were not, reconciled or explained by the assessee as its unexplained investments u/s.69 of the Act totaling Rs. 16,51,49,573/- in respect of 10 transactions as "Income from Other Sources" and taxed it at 40%." 3. The assessee has filed an application in Form No. 35A alongwith the objections u/s 144C of the Act on 31.01.2011 against the income proposed by the AO in his draft assessment order dated 21.12.2010. During the course of hearing before the DRP, the assessee furnished the copy of bank account with Deutsche Bank and confirmation from various brokers for executing the trade during the period from 1.4.2007 to 31.3.2008 and stated that the assessee has only one bank account through which the investment activities are carried out. The DRP forwarded the same to the assessing officer calling for specific comments and report. The DRP after considering the remand report of the AO and the assessee's submissions, has observed a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... " ( iv ) In view of the above practice adopted by the brokers as mentioned above, it is only the broker, who could have given the details of real purchaser/seller of the shares appearing in the assessee's account as communicated by BSE/NSE in the AIR Data furnished to the Income-tax department. However, the assessee has made no effort to make a complete verification of the data provided to him by the AO. Failure on the part of the assessee to do so, had led to the present situation where 10 transactions which have been treated as unexplained/undisclosed investments u/s.69 by the AO in the assessment order, remain unreconciled and unexplained till date. ( v ) When other tax payers similarly placed are able to make complete verification and furnish reconciliation before the AO or after assessment during the hearing before the DRP, there is no reason or justification for the assessee not being able to do so, with the result that the transactions which are treated as unexplained investments of the assessee by AO continue to remain so even now. ( vi ) The AO reported in his remand report dated 22.9.2011 that in spite of further opportunities given, the assessee is unable to obtai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... D read with Section 111A of the Act on capital gains as against 40% on the entire transaction value of Rs.16,51,49,573/-. 6. The learned DDIT erred in not granting credit for advance tax paid of Rs.1,71,760/- without assigning any reasons for the same. 7. The learned DDIT erred in levying interest tinder section 234B of Rs.2,90,46,836/-" 5. At the time of hearing, the ld. Counsel for the assessee, at the outset, submits that the whole addition was made on the ground that the assessee could not reconcile the transactions which were considered by the AO as unexplained investments. He further submits that post the assessment order, the assessee has been able to obtain from the respective brokers letters confirming the practice adopted by the said brokers as well as the details of pre and post allocation of the trades executed by them on behalf of the Foreign Instrumental Investment (FII). Accordingly, the assessee has been successful in identifying the real sub-account to whom the transactions mentioned in the CIB report were allocated and thus, has been able to reconcile the unconcealed transactions which had been treated as unexplained investment by the AO. In the light of t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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