9911796707
TMI Blog2022 (4) TMI 1316X X X X Extracts X X X X X X X X Extracts X X X X ..... t filed the return of income under Section 139(1) of the Income Tax Act, 1961 (hereinafter referred to as "the Act"). However, the assessee made trading in penny stock script M/s. Vax Housing Finance Corporation Limited to the tune of Rs. 32,25,601/-. Therefore, a notice under Section 148 of the Act was served on the assessee on 30.03.2018. Inspite of 143(2) notices and show cause notice dated 16.10.2018 the assessee failed to respond before the Assessing Officer. Therefore, an ex-parte assessment order was passed under section 144 read with section 147 of the Act making addition of Rs. 32,25,601/- as the escaped income of the assessee. The Assessing Officer also initiated penalty proceedings under Section 271(1)(c) of the Act and Section 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... proceed to deal with genuineness aspect, it is important to bear in mind the fact that what is genuine and what is not genuine is a matter of perception based on facts of the case vis-avis the ground realities. The facts of the case cannot be considered in isolation with the ground realities. It will, therefore, be useful to understand as to how the shell entities, which the loan creditors are alleged to be, typically function, and then compare these characteristics with the facts of the case and in the light of well settled legal principles. A shell entity is generally an entity without any significant trading, manufacturing or service activity, or with high volume low margin transactions to give it colour of a normal business entity used ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... given elaborate reasons to come to the conclusion that the entire transaction was not genuine in absence of any perversity, we do not see any reason to interfere. 4. Learned counsel for the assessee however vehemently contended that the assessee had received loans through cheques from lenders who had confirmed the same. Their accounts are audited and failed before the Revenue authorities. Thus, the genuineness of the transactions, the capacity of the lender and the factum of lending all have been established. Addition under section 68 of the Act there could not have been made. However, as noted, the Tribunal has minutely examined the position of the lenders, the circumstances under which, the amounts were allegedly loaned to come to the c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tal gain by claiming exemption u/s.10(38) of the Act. The source of investment made in M/s. Vax Housing Finance Corporation Limited by the appellant was neither explained before the AO nor before the undersigned and therefore, the addition of Rs. 32,25,601/- made to the total income of the appellant is confirmed. Grounds of appeal are dismissed." 4. Aggrieved against the appellate order, the assessee is in appeal before us raising the following grounds of appeal "1. The order passed by the learned CIT(A) is bad in law and on facts and against the natural justice. It is submitted that the same be held so now. 2. The Learned CIT(A) has erred in making an addition on account of trading in Penny Stock of M/s. Vax Housing Finance Corporatio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ence. 6. We have given our thoughtful consideration and finds that the assessee was not co-operative before the Assessing Officer even after providing six opportunities, therefore, the Assessing Officer was constrained to pass best judgement assessment. Even before the Ld. CIT(A) the assessee has not produced any details or evidences to substantiate her claim. However, the Ld. CIT(A) has passed a very detailed order running into 41 pages and thereby confirmed the addition of Rs. 32,25,601/-. Even before us the assessee has simply raised general grounds without any material or evidence. In the absence of the same and having given seven opportunities, the assessee has not shown any interest in proceeding the matter further. We, therefore, se ..... X X X X Extracts X X X X X X X X Extracts X X X X
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