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TMI Blog2022 (9) TMI 1176X X X X Extracts X X X X X X X X Extracts X X X X ..... raised by the revenue is dismissed. - Decided in favour of assessee. - I.T.A. No. 6808/Mum/2014 - - - Dated:- 18-5-2022 - SHRI AMIT SHUKLA, JM, AND SHRI AMARJIT SINGH, AM Appellant by: Shri Murli Mohan, Ld. DR Respondent by: Shri Rajiv Khandelwal, Ld. AR ORDER Per Amit Shukla, Judicial Member: The aforesaid appeal has been filed by the revenue against the impugned order dated 24.08.2014 passed by Ld. CIT(A)-39, Mumbai for the quantum appeal of assessment passed u/s 143(3) r.w.s 153A for AY 2006-07. The revenue has taken the following grounds of appeal:- 1. Whether on the facts and circumstances of the case and in law, the Ld. CIT(A) has erred in deleting the addition of a sum of Rs. 57,86,609/-made by the AO u/s. 68 in respect of LTCGs on sale of shares as bogus. 2. Whether on the facts and circumstances of the case and in law, the Ld. CIT(A) has erred in deleting the addition of a sum of Rs. 2,89,330/- made by the AO u/s. on account of unaccounted expenditure towards commission paid for obtaining bogus purchase 2. The facts in brief are that a search and seizure operations u/s 132 was conducted on 13.10.2010 in Welspun Group of cases, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that department was in possession of information that Mahasagar Securities Pvt. Ltd. was indulged in providing accommodation entries to various parties and the said fact has duly been acknowledged by said party in statement given to Income-Tax department. On the basis of such information, the assessee was asked to explain why the entire capital gain declared on the transactions of sale of shares of Asahi Infrastructure Ltd. should not be treated as bogus. 5. In response, the assessee submitted that the documents submitted prove that he has taken physical delivery of the shares, got it dematerialized and sold through Samurai Securities Pvt. Ltd., and hence it was stated that the genuineness of the transactions stood proved. AO observed that assessee had purchased the shares in physical form in three lots on 12.07.2005, 29.08.2005 and 30.08.2005 but had not furnished any evidence regarding purchase of such shares except for submitting a print out generated from Tradeplus dated 21.03.2013 and said documents are neither signed nor bear any seal of Samurai Securities Pvt. Ltd. The D-mat statement submitted reveal that these shares were dematerialized on various dates in the year 2005 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sment order that the appellant had failed to produce the physical shares showing transfer of the shares in his name. In this regard the appellant submitted that physical shares were surrendered to Indusind Bank Ltd. alongwith with dematerialization request form dated 29.8.2005, 30.8.2005 and 31.8.2005 in which Folio Certificate nos., distinctive nos. and quantity have been very much shown. Hence the same could not be produced before the Assessing Officer. c) It is submitted that in paragraph 7.6 of the assessment order, the Assessing Officer observed that the shares were purchased in physical form while the same were sold in demat form. In this regard, it is submitted that 75,000 shares were purchased on 13.4.2004 from Mahasagar Securities Pvt. Ltd. in physical form and dematerialized on 19.4.2005 and thereafter sold on 30.8.2005 i.e. after 4/months of dematerialization. Hence it is submitted that the observation, of the Assessing Officer that the shares were sold within a month's time of dematerialization is incorrect and contrary to the facts.. The appellant relies upon the order of the Pune Tribunal in the case of Ajay Shantilal Lalwani 145 TTJ 511(Pune) in which i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rm dated 30.3.2005 of Indusind Bank Ltd. giving therein Folio No., Share Certificate Number, Quantity of shares, the Name of the company and the Distinctive number of shares. iv) Transaction statement of Indusind Bank Ltd. where 75,000 shares of ''Asahi has been dematerialized on 12.7.2005. v) Transaction statement of Indusind Bank Ltd. where 7,50,000 shares of Asahi has been sold on 29/30/31.08.2005. xxxxxxxx 7.4. I have carefully considered the facts of the case, the reason for the addition as made, by the Assessing Officer as well as the submission of the appellant. I find that the appellant has placed before the Assessing Officer the Dematerialization Request form dated 30.03.2005 of Indusind Bank Ltd. I have examined the said Request form. It is observed-that the. said form gives details of the Folio No., Share Certificate Number, Quantity of shares, the Name of the company and the Distinctive number of shares. Unless the shares in physical form are surrendered before the Depositing Participant, the said request details cannot be entered in. Subsequently the said quantity of 75,000 shares were dematted on 12.7.2005. The Transaction Statement fr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n made by the AO cannot be sustained in law. Ld. DR on this point relied upon the order of the CIT(A). 11. We have heard the rival submissions and also perused the relevant findings given in the impugned order as noted above. We find that on the date of search i.e. 31.10.2010, the assessment for the AY 2006-07 had already attained finality and in terms of section proviso to section 153A, it was unabated assessment. Admittedly, the addition on account of LTCG on sale of shares is not based any incriminating material or documents or information found during the course of search, albeit it was on the basis of computation of income and the information already given in the income tax return which already stood assessed. It is now well settled law where the assessment has attained finality and stands concluded at the time of search and are not abated, then no addition can be made in absence of any incriminating material or documents found during the course of search. This proposition is well settled by the Hon‟ble Bombay High Court in the cases of; CIT vs. Continental Warehousing Corporation, reported in (2015) 374 ITR 645; CIT vs. SKS Ispat Power Ltd. Reported in 99 Taxman. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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