Forum
Read and express views
× Latest Case Laws on Income Tax by various Income Tax Appellate Tribunals in India

These are the latest case laws decided by various Income Tax Appellate Tribunals (ITAT) of India on Income Tax which have been published recently. The case laws are open for discussion and we invite expert comments from our members on its applicability and effect on relevant issues.

03-09-2019, Saroj Mootha, Section 10(38), Tribunal Chennai

  • amit
  • amit's Avatar Topic Author
  • Offline
  • Administrator
  • Administrator
More
5 days 5 hours ago #10750 by amit
Section - 10(38)
Order Date - 03-09-2019
Favouring - Partly allowed for statistical purposes
Court - Tribunal Chennai
Appellant - Saroj Mootha
Respondent - ITO
Justice - N.R.S. GANESAN JM & S. JAYARAMAN AM
Citation - 919Taxpundit71
Appeal No. - I.T.A.No.423/CHNY/2019
Asstt. Year - 2012 -13

Order

PER : S. JAYARAMAN

The assessee filed this appeal against the order of the Commissioner of Income Tax (Appeals)-5, Chennai in ITA No.354/CIT(A)-5/2017-18 dated 14.12.2018 for the assessment year 2012-13.

2. Smt. Saroj Mootha, the assessee, an individual purchased 41,500 shares of M/s. Esaar India Ltd., on 17.05.2019 for Rs.41,500/- by cash, off market, and subsequently earned a profit of LTCG and claimed it as an exempt income U/s.10(38). The Assessing Officer received a report from the investigation wing of Kolkata, in which, inter alia, the assessee was specified as one of the parties who indulged in bogus / non-genuine long term capital gain from the transactions of alleged purchase and sale of shares of Esaar (India) Ltd. Further, the shares of Esaar India Ltd were found by them as penny stock company which has been used for generating bogus LTCG and the investigations revealed that a scheme was hatched by various players to obtain / provide accommodation of entry of bogus LTCG through manipulation of stock market. Therefore, the Assessing Officer re-opened the assessment. During the reassessment the Assessing Officer required the assessee to furnish particulars. The assessee has not furnished the required particulars. Therefore, the Assessing Officer examined the entire set of transactions in the background of the information received from the DIT(Inv), Kolkatta and upon such examination of facts and on detailed analysis of the transactions held, inter alia, that the transaction of purchase and sale of shares are not genuine, it is a colourable device adopted by the assessee to give the substantial gains shown on the sale of such penny stocks, within colour of genuineness so as to convert the unaccounted money into accounted money without the need to pay any taxes. Therefore, the Assessing Officer treated the entire sale at Rs.63,77,513/- added to the income Further, the assessee claimed interest expenditure of Rs.4,69,089/-. Since, the interest claim did not commensurate w th the earning, the Assessing Officer disallowed Rs.70,363/- and added to the returned income. Moreover, the Assessing Officer disallowed Rs.77,248/-, the dividend claimed by the assessee and added to the income. Aggrieved, the assessee filed an appeal before the CIT(A). The Ld CIT(A) dismissed the appeal. Aggrieved against that order, the assessee filed this appeal.

3. It was submitted by Ld.AR that the issue in this appeal is against the action of the Ld. CIT(A) in confirming the additions made by the Assessing Officer in treating the purchase and sale of shares by the assessee as penny stock transactions. The Ld.AR submitted that the Ld.CIT(A) upheld the interest disallowance made by theAssessing Officer although such expenses were incurred by the assessee and upheld the disallowance of dividend income without appreciating the facts and circumstances of the case. Per Contra, the Ld DR submitted that the assessee has claimed deduction u/s 10 (38) but she has not furnished any material in support of her claim and to prove the genuineness of the transactions. Further, the assessee has not furnished any material and substantiated its interest claim. Therefore, reiterating the facts and circumstances of these cases from the orders of the lower authorities the Ld. DR supported the orders of the lower authorities.

4. We have considered the rival submissions. It is noticed that the assessee has not been given a fair opportunity to prove the genuineness of the transactions but the assessment has been made primarily based on the evidences collected by the Revenue in the course of the investigation conducted by them on the brokers / share broking entities etc. This is not permissible. This being so, in the interests of natural justice, the issue of the genuineness of the transactions require re-adjudication. Since, the right to exemption must be established by those who seek it, the onus therefore lies on the assessee. In order to claim the exemption from payment of

Click to view and download Full Free Judgement of Saroj Mootha vs. ITO

Unable to display Google Map.




Please Log in or Create an account to join the conversation.

Time to create page: 0.107 seconds

If You Appreciate What We Do Here On TaxPundit, You Should Consider:

We are thankful for your never ending support.

Latest Analysis - High Courts

PCIT vs. Sahara States Gorakhpur

PCIT vs. Sahara States Gorakhpur

PCIT vs. Sahara States Gorakhpur Read More
GENPACT INDIA PRIVATE LIMITED vs. DCIT

GENPACT INDIA PRIVATE LIMITED vs. DCIT

GENPACT INDIA PRIVATE LIMITED vs. DCIT Read More
Jugender Singh Yadav vs. PCIT

Jugender Singh Yadav vs. PCIT

Jugender Singh Yadav vs. PCIT Read More
ROHIT KUMAR GUPTA vs PCIT

ROHIT KUMAR GUPTA vs PCIT

ROHIT KUMAR GUPTA vs PCIT Read More
  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41

Forum Features

Latest Case Laws
Latest Case Laws are instantly updated in the Forum into their respective section
Latest from CBDT
Latest Circulars, Notifications, Orders etc. from CBDT is updated in the Forum
Ask Experts
You can ask questions to the community
Support
Support queries are either replied via mail or in the Forum so that others can be benefited
Press Releases
Latest Press Notes and Press Releases are updated in the Forum
Connect with Members
You can connect with our community members by replying to their queries

Recommended Articles

 

SITE INFORMATION

All content herein is the copyright of Taxpundit. No images, text, or any other content may be, reproduced or redistributed without the express written consent of Taxpundit.

All Rights Reserved. All Content Copyright.

Newsletter

Subscribe to our newsletter and stay updated on the latest developments and special offers!

Company Master Data Since 1900. More than 1.75 Million Records. Register/Login to get FREE access. Read more
Toggle Bar