Sahil Satishbhai Shah Vs ITO (ITAT Ahmedabad)
In a recent judgment, the Income Tax Appellate Tribunal (ITAT), Ahmedabad bench, has set aside an addition of Rs. 2,53,000 made against an individual taxpayer, Sahil Satishbhai Shah, for the Assessment Year 2012-13. The case revolved around alleged “client code modification” (CCM) involving shares of C. Mahendra Ltd, which the tax authorities had treated as unexplained cash credit under Section 68 of the Income-tax Act, 1961.
The dispute originated when the Assessing Officer (AO) reopened Mr. Shah’s tax assessment based on information suggesting he was a beneficiary of CCM conducted by M/s. Affluence Share & Stock Pvt. Ltd. The AO contended that Mr. Shah had facilitated the modification of client codes for 1,000 shares of C. Mahendra Ltd, resulting in Rs. 2,53,000 being transferred to his account. Due to the taxpayer’s purported failure to substantiate the genuineness of these transactions, the amount was added to his taxable income as an unexplained credit.
Mr. Shah had initially filed his return for AY 2012-13 on July 28, 2012, declaring a total income of Rs. 18,93,710. Upon receiving the assessment order, he appealed to the Commissioner of Income Tax (Appeals) [CIT(A)]. However, the CIT(A)-12, Mumbai, upheld the AO’s addition, dismissing Mr. Shah’s appeal.
