DCIT Vs Anmol Govindram Sekhri (ITAT Mumbai)
The ITAT Mumbai considered cross appeals filed by the Revenue and assessee against the NFAC order dated 17.09.2025 for AY 2019-20. The assessee, an investor in shares for over two decades, had declared total income of ₹3,28,00,390. Based on Investigation Wing information concerning transactions in M/s Florence Investech Ltd., the Assessing Officer initiated reassessment proceedings under Section 148A and subsequently issued notice under Section 148. The assessee furnished demat statements, ledger accounts, bank statements, computation of income and capital gains working. The AO nevertheless treated ₹4,07,25,879 as unexplained cash credit under Section 68, alleging that the share transactions represented accommodation entries.
Before the CIT(A), the assessee relied on documentary evidence and explained the corporate background of Florence Investech Ltd. The CIT(A) noted that the company had been promoted by J.K. Tyre Industries Ltd. and BMF Investments Ltd., with promoters holding 74.98% of the equity share capital. The CIT(A) also considered the subsequent transfer of promoter shareholding and amalgamation involving Florence Investech Ltd. and Bengal & Assam Company Ltd. The CIT(A) observed that the AO had concluded that the share prices were manipulated but had not established how the alleged price rigging occurred. The CIT(A) further noted that SEBI had not banned trading in the shares or found any individual, broker or promoter guilty of price rigging. The CIT(A) therefore directed deletion of the ₹4,07,25,879 addition under Section 68.
