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TMI Blog2019 (1) TMI 347X X X X Extracts X X X X X X X X Extracts X X X X ..... - Decided in favour of assessee. Disallowance in respect of Long Term Capital Loss suffered by Assessee Company on sale of equity shares of its group companies - group of the Assessee is gaining by collusive transactions leading to fictitious loss as the shares of group companies had been sold at a price much lower than its market value without the dynamics of market force - Held that:- AO was not justified in rejecting the claim of the assessee on the basis of theory of surrounding circumstances, human conduct, and preponderance of probability without bringing on record any legal evidence against the assessee in respect of the market value of the shares vis-à-vis price bargained by the parties. That is, ld AO failed to bring any cogent evidence on record to show that ‘price bargained by the parties’ to compute capital gain is not correct. CIT- A was wrong in confirming the aforesaid disallowance wrongly relying on the concept of fair market value of the transactions referred to in section 45(2) and Section 45(4) which has no relevance to the facts of this case relating to transfer of shares on actual sale value/price bargained. Considering all we are unable to uphold the stand ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... isdictional Kolkata Benches of Appellate Tribunal relied on by it in support of its claim . 4 ) That the learned Commissioner of lncome Tax ( Appeals ) erred in confirming the aforesaid disallowance of Rs . 1,04,40,635 wrongly relying on the concept of fair market value of the transactions referred to in section 45 ( 2 ) and Section 45 ( 4 ) of the Act which has no relevance to the facts of this case relating to transfer of shares onactual sale thereof . 5 ) That the Learned Commissioner of lncome Tax ( Appeals ) erred in confirming theaforesaid disallowance of Rs . 1,04,40,635 on various findings and observations whichare contrary to law and facts of the case and are therefore perverse based onirrelevant considerations, surmises, suspicions and conjectures . 3. Ground No.1 raised by the assessee relates to addition of ₹ 13,40,331/- on account of cash received out of regular books of accounts. 4. The brief facts qua the issue are that the assessee had filed return of income on 30.09.2011 declaring total income of ₹ 77,29,760/-. Later on, a revised return was filed, declaring total income to the tune of ₹ 2,15,10 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e that a survey u/s 133A was conducted at assessee s premises on 19.02.2013. Thereafter, assessee revised his return of income and declared total income of ₹ 2,15,10,270/-. During the survey proceedings certain documents were impounded from assessee s premises, containing loose sheets and such impounded documents revealed assessee s transaction with M/s Choudhury Hydrocarbon (P) Ltd. The date wise and bill wise details of the transactions with this party is mentioned in the loose sheets. These loose sheets mentioned details of Cheque to be given to party and Cash to be collected from the party .The assessing officer noted that Cash to be collected from the party was to the tune of ₹ 13,40,331/-. As the amount of ₹ 13,40,331/- was neither offered for taxation, nor it was reduced from the purchases made, therefore the addition of ₹ 13,40,331/- was made by the assessing officer. In appellate proceedings, assessee has denied the receipt of any cash from Choudhury Hydrocarbon (P) Ltd. 9. We note that these loose sheets are only dumb documents without any corroborative evidence. Assessee has submitted that all its purchases from Choudhury Hydrocarbon (P) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e same do not warrantany interference . 2 . ACIT Vs . J . P . Morgan India ( P ) Ltd . [ 2011 ] 46 SOT 250 ( Mum .) 3 . CIT Vs . Dinesh Jain HUF [ 2012 ] 211 Taxman 23 ( Delhi ) 4 . CIT Vs . Jaipal Aggarwal [ 2013 ] 212 Taxman 1 ( Delhi ) wherein it was held that Dumb documents seized, ie from whichnothing could be clearly understood, cannot form a justifiedbase for making additions to income of the assessee . 17 . 1 In view of the above discussion, we are of the view that theaddition made by the Assessing Officer based on the loose paper,which is not a conclusive evidence and, therefore, the same is notsufficient to make the addition . In our opinion, no addition can bemade on the basis of dumb documents / note book / loose slips inthe absence of any other material to show that the assessee hasmade investments in land . Noting on the note book / diary / loosesheets are required to be supported / corroborated by otherevidence and are also include the statement of a person whoadmittedly is a party to the noting and statement from all thepersons whose names there on the note book / ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... leading to fictitious loss as the shares of group companies had been sold at a price much lower than its market value without the dynamics of market force, therefore, ld CIT(A) had confirmed the addition made by the Assessing Officer, to the tune of ₹ 1,07,99,741/-. 13.Aggrieved by the order of the ld. CIT(A), the assessee is in appeal before us. The ld Counsel for the assessee reiterated the submissions made before the authorities below. On the other hand, ld DR relied on the stand taken by the assessing officer. 14. We have heard both the parties and perused the material available on record, we note that in the assessee s case under consideration the group companies were going through a process of internal corporate restructuring whereby the shares of its various group companies were being transferred to Yaana Apparels Pvt. Ltd, which was being constituted as a holding company for its various other group companies. We note that the shares of M/s International Tar Refiners Pvt. Ltd, alongwith shares of their other group companies, were transferred to M/s Yaana Apparels Pvt Ltd, for consideration as agreed between the group companies and M/s Yaana Apparels Pvt Ltd. Henc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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