9911796707
TMI Blog2013 (10) TMI 552X X X X Extracts X X X X X X X X Extracts X X X X ..... for its client code A055 which pertains to Ashok Ambani and not the assessee K. Nareshchandra (HUF). 3. On the facts and in the circumstances of the case, the CIT(A)-I, Thane erred in overlooking the fact that Bombay Stock Exchange has further confirmed that DPS Shares & Securities Ltd. has not dealt in the scrip Robinson Worldwide Ltd as on 04.04.2003 where as the assessee has claimed to have purchased the shares on 04.04.2003. 4. The appellant prays that the order of the CIT(A)-1, Thane, may be vacated and that of the Assessing Officer be restored." 2. Basically, the appeal pertains to one single issue, i.e. the deletion of Rs. 18,65,220/-, as unexplained cash credit. 3. The facts in brief are that in the assessment proceedings, the AO required the assessee to produce balance sheet for assessment year 2004-05 along with details of demat account for financial years 2003- 04 & 2004-05 and payments made for purchase of shares and the assessee request to convert the physical shares to demat. 4. These details were provided vide letter dated 14.06.2007. The assessee also submitted the contract notes for purchase & sale of the shares done through DPS Shares and Securities Pvt. Ltd ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... counts. 3. Statement of transaction dated 07.07.2004 in respect of assessee's demat account with DP M/s. Sodhani Securities Limited which reflect the sale and subsequent debit of 20,000 shares of M/s Robinson Impex (I) Ltd." 7. On taking into account complete details, as received from BSE and DPS, the AO concluded, The undersigned has carefully considered the facts of the case, letters received from the Bombay Stock Exchange & DPS Shares Securities Pvt Ltd as above and the explanation of the assessee. On the basis of information gathered from BSE, it is very clear that though the sale transaction of the said shares have been executed by the trading member DPS shares securities Pvt Ltd, but it was not in the name of assessee but in the name of some other person. It is therefore proved that the so called 20,000 shares of M/s. Robinson Impex (I) Ltd were not sold by the assessee through DPS Shares Securities Pvt Ltd as confirmed by the BSE also. M/s. DPS Shares Securities Pvt Ltd., Mumbai, in their letter dated 23.07.2007 has clearly confirmed that no transaction of purchase of the shares in question was materialized in the name of assessee and only an accommodation bill was issue ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the d'mat account of the appellant has been debited by the relevant quantity of shares either on the same date or the immediate subsequent date. The appellant in support of the transaction has produced before the A.O. and before me, the bills and contract notes for purchase and sale of shares, the photocopy of physical share certificate before and after dematerialization, written confirmation from the company M/s. Robinson Impex (I) Ltd. that the appellant was a share holder of the company on 30.04.2003, the d'mat statement with depository participant. No defect or deficiency in the genuineness of these documents has been pointed out by the A.O. In the result, these evidences cannot be over looked lightly. The 20,000 equity shares of M/s. Robinson Impex (I) Ltd. are found credited to the d'mat account of the appellant maintained with a depositary participant under the auspices of National Securities Depositary Ltd. (NSDL). On sale of shares on 3 different dates in June 2004, the relevant quantity of shares have been debited to the d'mat account of the appellant on the immediate subsequent date. Examination of the sale bills and the d'mat statement of the appellant reveal the follo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... O. has made the addition u/s 68 of the I.T. Act 1961 as unexplained cash In the present case, the source of receipt of Rs. 18,65,220/- is from sale of 20,000 equity shares of M/s. Robinson Impex (I) Ltd., through the brokers M/s. D.P.S Shares and Securities Pvt. Ltd. The said broker has confirmed the transaction of sale, the requisite shares have been sold by the said broker on the Bombay Stock Exchange on the given dates albeit in the client code of a third person. The amount credited in the books of the appellant is received from M/s. D.P.S. Shares and Securities Pvt. Ltd. through banking channels. The existence of shares with the appellant in view of the same being in dematerialized form in the d'mat account of the appellant cannot be denied. The shares have been debited to the d'mat account of the appellant and have thus flown through the d'mat account on relevant dates. In view of the above facts, in my opinion addition u/s 68 of the I.T. Act 1961 in the case of the appellant is not justified' The CIT(A), suo moto, relied on the following decisions: "5.6 The Hon. Mumbai ITAT, in the case of ACIT -- Vs -- Claridges Investments & Finances Pvt. Ltd., 18 SOT 390 (Mum) in a simil ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... were considered and the proceeds pertaining to that sale. He also referred to the fact that the assessee was holding shares prior to this sale. With regard to the confusion on name, the AR submitted that the HUF name of the assessee was K Naresh Chandra (HUF) and there is no ambiguity on this aspect. 14. We have heard both the parties and have also gone through the details placed before us, as well as the case laws cited by either side. 15. Strictly going through the facts that the addition can be made u/s 68 when all the ingredients of the provision are not met / satisfied. The undisputed facts are that assessee was holding 20,000 shares of Robinson World Wide Trade Ltd., which it sold and the sale proceeds were entered in the books of account. The fact that the assessee held shares of the above named company has been confirmed by the company itself. 16. The fact that the assessee sold the shares in three lots is confirmed by the broker, i.e. DPS. 17. These facts have been considered by the CIT(A) in para 5.5 of the impugned order (as reproduced earlier in this order). The CIT(A) also made observations with regard to errors in client codes, which are prevalent, and creep into ..... X X X X Extracts X X X X X X X X Extracts X X X X
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