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TMI Blog2019 (7) TMI 432X X X X Extracts X X X X X X X X Extracts X X X X ..... mount, hence the matter requires to be re-considered by the respondent by providing fair and reasonable opportunity of hearing to the assessee and by furnishing the details / copy of the statement based on which the impugned assessment order has been passed. The facts noted by the High Court appears to be similar to the fact situation in the case on hand and therefore by respectfully following the judgment in the case of Chandra Devi Kothari (Supra), I set aside the impugned order of learned CIT(A) for Assessment Year 2007-08 and restore the matter to the file of the AO for fresh adjudication with the same directions as were issued by the Hon ble Karnataka High Court in above judgment. In view of this decision, no adjudication is called for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e., ₹ 38,640/- + ₹ 537/- of security transaction tax) as 'Income from Other Sources', which was earlier declared as short term capital gain of ₹ 36,640/- arising on sale of shares through Mahasagar Group. On appeal, the CIT(A), vide order dated 18.03.2019, upheld the AO's order, not for the reason taken by the AO, i.e., that the share transactions are not genuine as it is done through Mahasagar Group; but on the grounds that (a) contract note for purchase / sales are not issued by broker of recognized stock exchange, (b) the purchase and sale are off market and (c) the transactions do not qualify as spot delivery contracts. 3. Aggrieved by the order of CIT(A)-12, Bangalore, the assessee has filed this appeal before the Tr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... law and are liable to be quashed. 4. The assessing officer had in any case, erred in treating a sum of ₹ 39,177/- being short term capital gain earned on sale of shares as 'Income from other sources' and the learned Commissioner of Income tax (Appeals) has erred in confirming the same. The action of authorities below has no support in law; is contrary to facts and evidence available and therefore deserves to be rejected. 5.1 In any case, the learned CIT(A) has erred in holding that a) it was proposed not to rely on the statements of third party therefore the question of cross examination does not arise at all. b) The contract note for purchase and sale of shares were not issued by a broker of recognized stock exchange ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rned by the appellant be accepted, the assessment of Short term capital gain earned on sale of shares as Income from Other Sources be deleted and the interest levied be also deleted. 4.1 The learned AR for the assessee has drawn the attention of the Bench to the Assessment Order to highlight the fact that the re-assessment proceedings under section 147/148 of the Act for Assessment Year 2007-08 were taken up by the AO solely on the basis of information that the capital gains on shares transacted (i.e., purchased and sold) by the assessee in the period under consideration were not genuine as they were carried out through the Mahasagar Group; that these transactions never actually took place and proceeded to complete the assessment holding t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e file of the AO for fresh adjudications with the same directions. 4.2 Per contra, the learned DR supported the orders of the authorities below. 4.3.1 I have considered the rival submissions and first of all, I reproduce Para No.8 of the judgment of Hon'ble Karnataka High Court rendered in the case of M/s. Chandra Devi Kothari (Supra) and this is as under: "8. In the light of the facts and circumstances as adverted to above and as the petitioner has been denied an opportunity of fair hearing by providing copy of the statement and related details regarding the alleged share amount, I am of the view that the matter requires to be re-considered by the respondent by providing fair and reasonable opportunity of hearing to the petitioner and ..... X X X X Extracts X X X X X X X X Extracts X X X X
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