Bhivraj Mohanlal Jain Vs CIT (ITAT Nagpur)
The Income Tax Appellate Tribunal (ITAT), Nagpur Bench, in the case of Bhivraj Mohanlal Jain Vs CIT, allowed the appeal of the assessee for the Assessment Year (A.Y.) 2013-14, deleting an addition of made under Section 69 of the Income Tax Act, 1961. The dispute centred on the taxability of share transactions in the stock of M/s. Priti Mercantile & Co., which the Revenue Department alleged were accommodation entries resulting from stock market manipulation.
Background and Initiation of Proceedings
The assessee, Bhivraj Mohanlal Jain, had originally declared a total income of for A.Y. 2013-14. Subsequently, the Assessing Officer (AO) received information that the assessee was a beneficiary of an accommodation entry from M/s. Priti Mercantile & Co. through the manipulation of the stock market. The information indicated that the assessee had sold shares of this company to the extent of and had not fully and truly disclosed all material facts.
Based on this information, the AO reopened the case by issuing a notice under Section 148 of the Act on March .
Assessment and First Appellate Stage
Despite the issuance of statutory notices, the assessee made no compliance during the assessment proceedings. Consequently, the AO proceeded to complete the assessment, making an addition of under Section 69 of the Act as unexplained investment.
