PCIT Vs Rajat Finvest (Delhi High Court)
The observation of the Assessing Officer, that the funds which flowed from REI in the form of unsecured loans to six companies, which were located in Gujarat, were unaccounted income of the respondent/assessee, appears to be based on assumptions and/or conjectures. We were shown no material to back the conclusion arrived at by the AO.
According to us, the appellant/revenue could not have bifurcated the purchase and sale transactions. Concededly, when the shares were purchased for trading purposes in earlier years, the profits so generated were accepted, and at the point in time, when these scrips were converted into investment and sold during the Assessment Years in issue, they could not be treated as bogus transactions.
The fact that shares were traded on stock exchange after paying securities transaction tax, and that money had been received through banking channels only demonstrated that they were not bogus transactions.
FULL TEXT OF THE JUDGMENT/ORDER OF DELHI HIGH COURT
1. These are the applications filed on behalf of the appellant/revenue seeking condonation of delay in re-filing the appeals.
1.2 For the reasons given in the applications, the delay in re-filing the appeals is condoned.
1.3 The applications are accordingly disposed of.
ITA 13/2023, ITA 14/2023 & ITA 15/2023
2. These appeals, filed by the appellant/revenue, are directed against the common impugned order dated 12.09.2019 passed by the Income Tax Appellate Tribunal [in short “Tribunal”]. The impugned order concerns Assessment Year (AY) 2010-2011 [ITA 13/2023], AY 2009-2010 [ITA 14/2023] and AY 2008-2009 [ITA 15/2023].
3. The main allegation against the respondent/assessee is, that it has introduced unaccounted income in its books in the guise of “bogus Long Term Capital Gains” [“LTCG”].
3.1 The LTCG, as per the Assessment Order dated 31.03.2015, which were registered by the respondent/assessee in each of the AYs is the following:
