9911796707
TMI Blog2019 (1) TMI 1900X X X X Extracts X X X X X X X X Extracts X X X X ..... y operators for providing accommodation entry in Long Term Capital Gain. Here, in this case, there is no reference of any entry provider or any information that the assessee has paid any unaccounted money for getting such kind of an accommodation entry. Once the nature of transaction is dealing in shares and source of the credit appearing in the bank account is from sale of shares, then without any contrary material to show that such credit in the bank account is bogus or non-genuine, then said credit cannot be deemed to be income of the assessee. Though such a phenomenal rise of the shares in a span of 18 months do raises lot of suspicion, but howsoever strong suspicion may be, there has to be some kind of an evidence or information tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 19.05.2017 passed by the Commissioner of Income Tax (Appeals)-XXVIII, New Delhi for the quantum of assessment passed u/s.143(3) of the IT Act, for the Assessment Year 2014-15. In the grounds of appeal, the assessee has challenged the addition of ₹ 6,80,000/- made u/s.68 by disallowing claim of exemption u/s.10(38) in respect of Long-Term Capital Gain earned at listed equity shares sold through Bombay Stock Exchange after payment by Security Transaction Tax, on the ground that it is a case of penny stock. 2. The facts in brief are that the assessee had purchased 1,000 shares of M/s. Kappac Pharma Ltd. at the face value of ₹ 13 per share on 13.09.2012. These shares were purchased through broker, M/s. Shah Tradwing Gujarat Pvt. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... years 2009-10 and in the financial year 2010-11, its equity capital had arisen to ₹ 23.77 crore for which no particular reason could be deduced and such increase only raises a suspicion that this was purely for different intention. There was no fixed asset or tangible asset to support any business activity and there were no earning/operating profit in the company. Thereafter, he discussed the general modus operandi of Long-Term Capital Gain Schemes which was unearthed by the Directorate of Investigation, Kolkata. Thereafter, he referred to many judgments and finally held that amount of ₹ 6,80,000/- credited in the bank account of the assessee is an unexplained cash credit to be added u/s.68 which should be taxed under the rate ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rat Pvt. Ltd. along with copy of cash receipts and the payment of purchase consideration of share. 4. Copy ledger account of the assessee as appearing in the books of M/s. Shah Tradwing Gujarat Pvt. Ltd. 5. Copy of Demat account and entire transaction as appearing in the Demat account. 6. Copy of sale contract note shown the sale transaction of the share. 7. Copy of STT certificate showing deduction of STT on sale transaction. 6. Apart from that, he has also given the price history of stock of M/s. Kappac Pharma Ltd. from 28.05.2012 to 25.03.2014 showing that in BSE, this scrip was traded regularly and how the price has risen gradually and were always quoted in the BSE. At the time of sale, the stock price of M/s. Kappac Phar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the very fact that the price of this company has risen from ₹ 13 to ₹ 700 per share in the span of 18 months which itself goes to show that these price were rigged only to provide accommodation entry to various beneficiaries and since assessee has also dealt in the same scrip goes to prove that assessee too was involved in taking a benefit of bogus Long Term Capital Gain. 8. From the perusal of the entire assessment and appellate order, it is seen nowhere there is any evidence or information gathered during the course of any investigation or inquiry either from the broker or from the company M/s. Kappac Pharma Ltd. that assessee is beneficiary of any accommodation entry or has routed his own unaccounted money in the gar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... any contrary material to show that such credit in the bank account is bogus or non-genuine, then said credit cannot be deemed to be income of the assessee. Though such a phenomenal rise of the shares in a span of 18 months do raises lot of suspicion, but howsoever strong suspicion may be, there has to be some kind of an evidence or information that assessee was involved in some kind of bogus or sham transaction, either by himself or through some entry provider. There is no whisper in the assessment order or appellate order that any action has been taken by SEBI against M/s. Kappac Pharma or they have been found to be rigging the price in the stock exchange. Once a listed share which is regularly traded in the recognized stock exchange at q ..... X X X X Extracts X X X X X X X X Extracts X X X X
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