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TMI Blog2023 (9) TMI 1451X X X X Extracts X X X X X X X X Extracts X X X X ..... tified in invoking the extended period of limitation and the fact that whether the beneficiary had no knowledge of about the fraud/forged and fake DEPB licenses have no bearing the imposition of custom duty. The ratio of judgement is squarely applicable to the transaction under consideration before us. Appellant deliberately withheld the information from the AO as well as the ld. CIT(A) which is within exclusive knowledge of appellant to establish the genuineness of transactions of purchase of shares of that company. It is nothing but a fraud played by the appellant against the AO as well as the ld. CIT(A) who are quasi judicial authorities employed for execution of the provisions of the Income Tax Act. Therefore, the principle of fraud can be squarely applied to the facts of the present case and principles of natural justice have no application. Decided against assessee. - HON'BLE JUDGES INTURI RAMA RAO, MEMBER (A) AND S.S. VISWANETHRA RAVI, MEMBER (J) For the Appellant : Hari Krishan For the Respondents : M.G. Jasnani ORDER INTURI RAMA RAO, MEMBER (A) 1. These are the appeals filed by the two different assessees directed against the separate orders of ld. Commissioner of In ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he assessee had proved the genuineness of the transactions of purchase and sales of shares. However, the ld. CIT(A) had confirmed the action of the Assessing Officer invoking the doctrine of test of human probability. 6. Being aggrieved by the decision of the ld. CIT(A), the appellant is in appeal before us in the present appeal. 7. The ld. AR submitted that the ld. CIT(A) ought not to have confirmed the addition of Rs. 2,98,95,128/-made by the Assessing Officer u/s 68 of the Act without considering the submissions of the assessee as well as without giving reasonable opportunity to rebut the case of the assessee. 8. The ld. Sr. DR placed reliance on the order of the ld. CIT(A) submits that in view of the decision of the Hon'ble Calcutta High Court in the case of PCIT vs. Swati Bajaj, 446 ITR 56 (Calcutta), the order of the ld. CIT(A) be upheld. 9. We heard the rival submissions and perused the material on record. The issue in the present appeal relates to whether or not the claim for exemption of capital gains u/s 10(38) of the Act is genuine. The material facts to be noted herein are as under : During the course of assessment proceedings, the Assessing Officer noticed that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... acing reliance on the decision of the Hon'ble Supreme Court in the case of Sumati Dayal vs. CIT, 214 ITR 801 (SC) and CIT vs. Durga Prasad More, 82 ITR 540 (SC). This finding of the ld. CIT(A) confirming the action of the Assessing Officer is under challenge before us contenting that the appellant had discharged the onus of proving the genuineness of transactions of capital gains in respect of exemption u/s 10(38) of the Act. In a case involving identical facts of the case, the Hon'ble Calcutta High Court after making reference to the decisions of Hon'ble Madras High Court in the case of CIT vs. Manish D. Jain, 120 taxmann.com 180 (Mad.) and PCIT vs. Prabha Jain, 439 ITR 304 (Mad.) had confirmed the action of the Assessing Officer by holding that the Assessing Officer had cogently brought out the factual scenario to establish machinations of fraudulent, manipulative and deceptive dealings and how the stock exchanges system was misused to generate bogus LTCG. 10. There is yet one more reason as to why we are inclined to confirm the addition made by Assessing Officer, in view of the well settled principle of law that fraud vitiate everything and even principle of natural ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Brothers [AIR 1992 SC 1555] it has been opined that fraud and collusion vitiate even the most solemn proceedings in any civilised system of jurisprudence. It has been defined as an act of trickery or deceit. The aforesaid principle has been reiterated in Roshan Deen v. Preeti Lal [AIR 2002 SC 33], Ram Preeti Yadav v. U. P. Board of High School and Intermediate Education and other [(2003) 8 SCC 311] and Ram Chandra Singh v. Savitri Devi and others [ (2003) 8 SCC 319]. 23. In State of Andhra Pradesh and another v. T. Suryachandra Rao [AIR 2005 SC 3110] after referring to the earlier decision this court observed as follows:- In Lazaurs Estate Ltd. v. Beasley [(1956) 1 QB 702] Lord Denning observed at pages 712 713, No judgment of a Court, no order of a Minister can be allowed to stand if it has been obtained by fraud. Fraud unravels everything. In the same judgment Lord Parker LJ observed that fraud vitiates all transactions known to the law of however high a degree of solemnity. 24. Yet in another decision Hamza Haji v. State of Kerala Anr. [AIR 2006 SC 3028] it has been held that no court will allow itself to be used as an instrument of fraud and no court, by way of rule of evidence ..... X X X X Extracts X X X X X X X X Extracts X X X X
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