Chandresh Luniya Vs ITO (ITAT Ahmedabad)
ITAT Ahmedabad held that reopening alleging income escaped assessment merely on the basis of Client Code Modification without any other corroborative evidence cannot be sustained. Accordingly, re-assessment held invalid.
Facts- The assessee is an individual and engaged in the business of shares and securities. Post scrutiny assessment, as per data relating to Client Code Modification (CCM) with the Department, it is found the assessee had entered into transaction through Mehta Finstock Pvt. Ltd. amounting to Rs.5,89,787/- which has escaped assessment, hence a notice u/s. 148 of the Act was issued on 30-03-2016.
Further the CCM has been done amounting to Rs. 12,56,760/- and not Rs. 5,89,787/- [which was shown to the assessee vide order sheet entry dated 02-12-2016] and the CCM made in the case of assessee in 63 transactions amounting to Rs. 12,56,760/-. AO held that repeated wrong client code mistake is not possible as CCM has been done 63 times which is not a genuine mistake and the Broker Mehta Finstock Pvt. Ltd. is unable to provide the details of CCM, this is not possible without instructions of the client, therefore, the same is not treated as genuine punching error and added in the income of the assessee. Thereby AO determined the total loss as Rs. 3,10,72,093/-.
