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Case Law Details

Case Name : Smt. Bhavna B. Kothari Vs ITO (ITAT Bangalore)
Appeal Number : I.T.A. No. 3740/Mum/2019
Date of Judgement/Order : 11/09/2020
Related Assessment Year : 2014-15
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Smt. Bhavna B. Kothari Vs ITO (ITAT Bangalore)

Conclusion: Merely because the issue was not elaborately discussed in the quantum assessment could not be a ground to invoke revisional jurisdiction u/s 263 particularly when the details called for by AO were submitted and placed on record.

Held: During the course of regular assessment proceedings, assessee had filed complete details of computation of LTCG. The copies of purchase bills, bank passbook evidencing purchase of shares through banking channels, copies of allotment letters pursuant to scheme of amalgamation, copy of demat statements, sale contract notes, brokers’ bill, transaction wise computation of LTCG was placed on record. Assessee earned LTCG on sale of certain shares of single entity namely M/s SRK Industries Ltd. The assessment was framed wherein AO chose not to alter the returned income of assessee. Subsequently, Pr. CIT, after perusal of case records, noted that the reason for selection of case under scrutiny was suspicious long-term capital gain on shares and there was an information by DGIT (inv.) related to trade by assessee in penny stock. As per the information, assessee sold 44000 shares of M/s SRK Industries for Rs.80.41 Lacs. Assessee, submitted that issue of LTCG was duly examined by AO during the course of regular assessment proceedings. Pr. CIT, not convinced with assessee’s submissions, the assessment order was termed as erroneous and prejudicial to Revenue in terms of Exp -2 to Sec. 263, the order was set-aside and AO was directed to redo the assessment after giving opportunity of hearing to assessee. It was held that there was proper disclosure of exempt LTCG in assessee’s computation of income. The transactions were duly explained by assessee with requisite documentary evidences during the course of regular assessment proceedings. There was due application of mind by AO on the stated issue and the claim was admitted after due verification. Merely because the issue was not elaborately discussed in the quantum assessment could not be a ground to invoke revisional jurisdiction u/s 263 particularly when the details called for by AO were submitted and placed on record.

FULL TEXT OF THE ITAT JUDGEMENT

1. By way of this appeal, the assessee contest correctness of revisional jurisdiction u/s 263 as exercised by Ld. Pr. Commissioner of Income Tax-22, Mumbai, for Assessment Year 2014-15, vide order dated 26/03/2019. The grounds raised by the assessee read as under: –

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