ITO Vs PrakashmalMalraj Jain (ITAT Mumbai)
In the case of ITO Vs. Prakashmal Malraj Jain, the Income Tax Appellate Tribunal (ITAT) Mumbai dismissed the Revenue’s appeal challenging the order of the Commissioner of Income Tax (Appeals) (CIT(A)) concerning the assessment year 2014-15. The dispute revolved around the addition of Long Term Capital Gains (LTCG) declared by the assessee, which the Assessing Officer (AO) deemed bogus based on a generalized report from the Investigation Wing. The AO reopened the assessment and assessed the sale proceeds as income without conducting an independent inquiry, relying solely on the report that linked the transaction to accommodation entries allegedly provided by Giriraj Kishore Agarwal. The CIT(A) deleted the addition, noting that the AO did not find any discrepancies in the documentation provided by the assessee, which included evidence of share purchases and sales made through legitimate banking channels and stock exchange platforms. Citing relevant case law, including a decision by the Bombay High Court, the ITAT upheld the CIT(A)’s decision, concluding that the AO’s reliance on a generalized report without specific findings against the assessee was unjustified. The Revenue’s appeal was thus dismissed.
FULL TEXT OF THE ORDER OF ITAT MUMBAI
The Revenue has filed this appeal challenging the order dt. 25-072023 passed by the learned Commissioner of Income Tax (Appeals)-NFAC, Delhi (in short “Ld.CIT(A)”) and it relates to AY. 2014-15. Though the Revenue has raised as many as 11 grounds, yet all of them are directed against a single issue with regard to the relief granted by the Ld.CIT(A) in respect of the addition relating to Long Term Capital Gain made by the AO by treating it as bogus in nature.
