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TMI Blog2019 (9) TMI 1089X X X X Extracts X X X X X X X X Extracts X X X X ..... aw, therefore arises in the present case and the consistent finding of fact returned against the Appellant are based on evidence on record. - Decided against assessee. - ITA 841/2019 - - - Dated:- 17-9-2019 - MR. VIPIN SANGHI AND MR. SANJEEV NARULA JJ. Appellant Through: Mr. Arvind Kumar and Ms. Devina Sharma, Advocates. Respondent Through: None. O R D E R C.M. No. 41505/2019 (exemption) 1. Exemption allowed, subject to all just exceptions. 2. The application stands disposed of. ITA 841/2019 3. The present appeal is directed against the order dated 25.07.2019 passed by the Income Tax Appellate Tribunal (ITAT) Delhi Bench 'G', New Delhi, in ITA No. 1006/Del/2019 for the assessment year 2014-15 whereby the tribunal had rejected the appeal preferred by the Appellant/Assessee. The Appellant had filed return of income for the assessment year 2014-15 declaring income of ₹ 4,96,650/-. The return of the Appellant was selected for scrutiny. The Appellant had booked Long Term Capital Gain (LTCG) of ₹ 73,77,806/- and sought exemption under Section 10 (38) of the Income Tax Act, 1961. The Assessing Officer on consideration of the r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce and materials on the basis of which the Assessing Officer recorded his findings with regard to the genuineness of the transaction in question. The findings returned by the Assessing Officer, the CIT (Appeals) and the Tribunal are based on appreciation of evidence and there is ample justification for them. Thus, it cannot be said that the findings of fact are perverse. The relevant discussion found in the impugned order reads as follows: 9. We have gone through the rationale given by both the parties pertaining to their arguments. In this case, it is an uncontroverted fact that the assessee has failed to prove the genuineness of the transaction. The AO has worked out the glaring facts, which cannot be ignored and which are clear indicative of the non-genuine nature of the transactions. The assessee could not satisfactorily explain how the investments in the absence of any evidence as to the financials, growth and operations of the company could earn profit of 4910% over a short period of 5 months from the date of allotment of shares (21.02.2013-date of allotment and 18.07.2013 to 12.09.2013 date of sale) of Cressanda Solutions Ltd. against the purchase of 15,000 shares of S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Trade Payables 0.00 0.00 23.82 22.35 0.00 Other current Liabilities 0.01 0.10 0.32 0.56 0.00 Short term Provisions 0.00 0.00 0.00 0.08 0.00 Total current Liabilities 0.01 0.10 24014 22.99 0.00 Total Capital and Liabilities 29.30 29.81 53.68 53.98 1.79 ASSETS NON CURRENT ASSETS Tangible Assets 0.03 0.04 0.05 0.06 0.00 Fixed Assets 0.03 0.04 0.05 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 0.00 6.44 0.99 0.00 Total operating Revenues 0.00 0.00 6.44 0.99 0.00 Other Income 0.03 0.17 0.14 0.07 0.02 Total Revenue 0.03 0.17 6.58 1.06 0.02 EXPENSES Operating and Direct expenses 0.00 0.00 5.14 0.08 0.00 Changes in inventories of FG, WIP and stock in trade 0.00 0.00 0.70 0.00 0.00 Employee Benefit Expenses 0.05 0.04 0.03 0.06 0.00 Depreciation and amortization expenses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it and loss accounts of Cressanda Solutions Ltd. which shows that the astronomical increase in the share price of the said company which led to returns of 491% for the Appellant, was completely unjustified. Pertinently, the EPS of the said company was ₹ 0.01/- as in March 2016, it was ₹ 0.01/- as in March 2015 and -0.48/- as in March 2014. Similarly, the other financials parameters of the said company cannot justify the price in excess of ₹ 500/- at which the Appellant claims to have sold the said shares to obtain the Long Terms Capital Gains. It is not explained as to why anyone would purchase the said shares at such high price. The Tribunal goes on to observe in the impugned order as follows: 10. With such financials and affairs of business, the purchase of share of face value ₹ 10/- at the rate of ₹ 491/- by any person and the assessee's contention that such transaction is genuine and credible and arguing to accept such contention would only make the decision of the judicial authorities a fallacy. 11. The evidences put forth by the Revenue regarding the entry operation fairly leads to a conclusion that the assessee is one of the benefi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s Pvt. Ltd. Similarly, the Tribunal in the case of Udit Kalra, ITA No. 6717/Del/2017 for the assessment year 2014-15 has categorically held that when there was specific confirmation with the Revenue that the assessee has indulged in non-genuine and bogus capital gains obtained from the transactions of purchase and sale of shares, it can be a good reason to treat the transactions as bogus. The differences of the case of Udit kalra attempted by the Ld. AR does not add any credence to justify the transactions. The Investigation Wing has also conducted enquiries which proved that the assessee is also one of the beneficiaries of the transactions entered by the Companies through multiple layering of transactions and entries provided. Even the BSE listed this company as being used for generating bogus LTCG. On the facts of the case and judicial pronouncements will give rise to only conclusion that the entire activities of the assessee is a colourable device to obtain bogus capital gains. The Hon'ble High Court of Delhi in the case of Udit Kalra, ITA No. 220/2009 held that the company had meager resources and astronomical growth of the value of the company's shares only excited ..... X X X X Extracts X X X X X X X X Extracts X X X X
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