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TMI Blog2014 (12) TMI 350X X X X Extracts X X X X X X X X Extracts X X X X ..... n. "On the facts and in the circumstances of the case and in law the CIT(Appeals) erred in confirming the order of the Assessing Officer holding that the claim of loss of Rs. 3,33,956/- is not genuine and in upholding the addition of the same as income from other sources. The appellant submits that the loss is genuine and without prejudice to the claim of the appellant the same has been wrongly treated as income from other sources." 3. In the present case assessee had entered into transactions of purchase and sale of shares of Media Matrix through M/s. Alliance Intermediaries and Network Pvt. Ltd. and has incurred a loss of Rs. 3,33,956/- out of these transaction. According to information received by the AO the said concern namely M/s. A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in similar circumstances similar addition has been deleted by the Tribunal on the basis that apart from the information there was no material on record according to which it could be said that the purchase and sale transactions entered into by the assessee were bogus. 1. Smt. Durgadevi Mundra vs. ITO, ITA No.1175/Mum/2012 & ITO vs. Shri Mahesh Mundra, ITA No.1176, A.Y. 2003-04 order dated 01.06.2012 2. Sachin N. Morakhia vs. ITO, ITA No.1122/Mum/2012,A.Y.2008-09 Order dated 01.06.2012 3. ITO vs. Mrs. Radhika Ravindra Kumar Toshniwal, 1331/Mum/2010, A.Y. order dated 13/03/2013. 4. Mayur M. Shah (HUF) vs. ITO , ITA No.2390/Mum/2013 ,A.Y. 2003-04 Order dated 10/07/2013. 4. On the other hand Ld. DR relied upon the order passed by the AO an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pectfully following the same I delete the addition. For the sake of completeness reference can be made to the aforementioned decision of Smt. Durgadevi Mundra vs. ITO (supra), wherein similar addition of Rs. 2,67,247/- was made. The assessee in that case was entered into purchase and sale of 3400 shares of M/s.Buniyad Chemicals Ltd. and 1000 shares of M/s. Jay Kee Dee Indl. Ltd. and these transactions of sale long term capital gain was shown at Rs. 2,67,247/-, which was taxed by the Department as income from other sources. The said addition was deleted with the following observations: "4. I have heard the parties and perused the record. The Ld. Counsel submits that in respect of the 'Shares Scam' alleged to be involved by Shri Mukesh Choks ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bogus. He has only examined the purchase of shares and doubted the date of purchase. But in the computation he has given benefit to the same cost of purchase of shares and taxed the long term capital gain offered as short term capital gain only. As far as the date of purchase is concerned, the evidence on record indicate that the assessee had indeed earned speculation profit by sale of APTECH shares which the Assessing Officer has not doubted. Further the assessee also suffered speculation loss as stated above in February, 2001 and debit and credit entries pertaining to same broker were shown in the balance sheet in the return filed for the AY 2001-2002 in August, 2001. There is also a mention of purchasing of shares of the company in the r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... section 131 on 9-11-2006 in which question No. 4 and 5 which are extracted in the assessment order itself. The main reliance is on question No. 5 which is as under : "Q.5 : Please give the details of bills of profit issued by your company as stated above. Ans: These bills numbers Bills No. CC/2000/16/12501 dt.18-4-2000 which shows that B.87610.85 payable to Shri Chandrakant D. shah. There is another Bill No. CC/2001/07/164 (N) dt.20/2/2001 in which Rs. 89602 was receivable by Shri Chandrakant B.Shah. These bills are issued showing fictitious profit and therefore the purchase are not substantiated by genuine payments." "8. This statement was relied upon by the Assessing Officer to state that the purchase bills are issued showing fictitiou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by any other evidence to deny the benefit of purchase of shares by the assessee on 8-4-2000. Not only that the Assessing Officer has also gave credit for the same amount of purchase of shares at cost and did not treat the sale proceeds as bogus/unaccounted income. The only action taken by the Assessing Officer is to deny the assessee the benefit of long term capital gain and subsequent deduction under section 54EC of the Act as the assessee invested the capital gains in REC Bonds. We do not see any reason to agree with the findings of the Assessing Officer and also the findings of the CIT (A). In fact, the CIT (A) has went ahead in treating the entire transaction as bogus and confirmed the action of the Assessing Officer while holding "thi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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