9911796707
TMI Blog2019 (9) TMI 1089X X X X Extracts X X X X X X X X Extracts X X X X ..... of the notices issued to the assessee, computed the net taxable income at Rs. 78,74,456/-. The AO added the amount of Rs. 73,77,806/- by denying the exemption claimed under Section 10 (38) of the Act on account of LTCG. The Assessment Officer (AO) found the transaction pertaining to purchase of shares by the Appellant/Assessee of M/s Smartchamps IT and Infra Ltd., which was merged with M/s Cressanda Solutions Ltd., to be a bogus transaction by holding that M/s Cressanda Solutions Ltd. was a penny stock. The appeal preferred by the Appellant before the learned CIT (Appeals) met the same fate and the findings of fact in relation to the transaction being bogus were upheld by the CIT (Appeals). The further appeal preferred before the ITAT has been dismissed and the ITAT has once again found the said transaction to be bogus. 4. We have, therefore, at the outset put it to learned counsel for the Appellant that since there are consistent findings of fact and the entire dispute raised by the Appellant is factual, there is no reason for the Court to entertain the present appeal and no question of law arises for our determination. 5. Counsel for the Appellant has submitted that the findin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... spite of earning so much of profit, the assessee has never embarked upon any transactions for investments with the broker or in any other dealing of shares. The revenue from operations of Cressanda Solutions Ltd. for the year March 2012 was Rs. 00 and, for the year March 2013 is Rs. 0.99 Cr. The financials of the company proving that the entity is a penny stock company are as under: Balance Sheet of Cressanda Solution ----------in Rs. Cr.---------- Mar 16 12 mths Mar 15 12 mths Mar 14 12 mths Mar 13 12 mths Mar 12 12 mths EQUITIES AND LIABILITIES SHAREHOLDER FUNDS Equity Share Capital 30.36 30.36 30.36 30.36 9.00 Total Share Capital 30.36 30.36 30.36 30.36 9.00 Reserves and Surplus - -065 -0.82 0.63 -8.89 Total Reserves and Surplus - -0.65 -0.82 0.63 -8.89 Total Shareholders' Funds 29.29 29.71 29.54 30.99 0.11 NON CURRENT LIABILITIES Long Term Borrowings 0.00 0.00 0.00 0.00 1.48 Other Long Term Liabilities 0.00 0.00 0.00 0.00 0.15 Long Term Provisions 0.00 0.00 0.00 0.00 0.05 Total Non Current Liabilities 0.00 0.00 0.00 0.00 1.6 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rlier years 0.25 0.00 0.00 0.00 0.00 Total tax expenses 0.25 0.00 0.00 0.09 0.00 Profit/loss after tax and before extra ordinary items 0.42 -0.15 -1.44 0.40 -0.02 Profit/loss from continuing operations 0.42 -0.15 -1.44 0.40 -0.02 Mar 16 12 mths Mar 15 12 mths Mar 14 12 mths Mar 13 12 mths Mar 12 12 mths OTHER ADDITIONAL INFORMATION EARNINGS PER SHARE Basic EPS (Rs.) 0.01 -0.01 -0.48 0.13 -0.02 Diluted EPS (Rs.) 0.01 -0.01 -0.48 0.13 -0.02 (emphasis supplied) 7. Thus, the Tribunal has in depth analyzed the balance sheets and the profit 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 Rs. 0.01/- as in March 2016, it was Rs. 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 Rs. 500/- at which the Appellant claims to have sold the said shares to obtain the Long Terms Capital Gains. It is not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... order to see whether the assessee is liable to the provisions of section 68 or not. In the case of NR Portfolio, it was held that the genuineness and credibility are deeper and obtrusive. Similarly, the bank statements provided by the assessee to prove the genuineness of the transactions cannot be considered in view of the judgment of Hon'ble court in the case of Pratham Telecom India Pvt. Ltd., wherein, it was stated that bank statement is not sufficient enough to discharge the burden. Regarding the failure to accord the opportunity of cross examination, we rely on the judgment of Prem Castings 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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