Income Tax Appellate Tribunal - Panji
Smt Kumud Mittal,Donapaula vs Acit, Central Circle, Panaji on 27 March, 2026
IN THE INCOME TAX APPELLATE TRIBUNAL, PANAJI BENCH, GOA
BEFORE HON'BLE SHRI PAVAN KUMAR GADALE, JUDICIAL MEMBER
AND
SHRI G. D. PADMAHSHALI, ACCOUNTANT MEMBER
Sr Appeal No Assessment Year Appellant Respondent PAN
Harshavardhan Mittal
1 IT(SS)A No 2013-14 Asstt. Commissioner of
Plot No 28, Machedos Cove,
002/PAN/2019 Income Tax,
Dona Paula, Panaji, Goa ACGPM0053R
& Central Circle,
(Represented by L/H with
2 003/PAN/2019 2014-15 Panaji, Goa
revised Form No 36)
3 IT(SS)A No 2013-14 Asstt. Commissioner of
Kumud Mittal
004/PAN/2019 Income Tax,
Plot No 28, Machedos Cove, AOJPM9203L
& Central Circle,
Dona Paula, Panaji, Goa
4 005/PAN/2019 2014-15 Panaji, Goa
Asstt. Commissioner of
Achintya Mittal
IT(SS)A No Income Tax,
5 2014-15 Plot No 28, Machedos Cove, AOJPM9124N
011/PAN/2019 Central Circle,
Dona Paula, Panaji, Goa
Panaji, Goa
6 IT(SS)A No 2013-14 Asstt. Commissioner of
Divya Mittal
008/PAN/2019 Income Tax,
Plot No 28, Machedos Cove, AOJPM9121K
& Central Circle,
Dona Paula, Panaji, Goa
7 009/PAN/2019 2014-15 Panaji, Goa
Sumitra Devi Asstt. Commissioner of
ITA No 830, Circular Road, Income Tax,
8 2014-15 AELPD7701A
001/PAN/2020 South Civil Lines, Central Circle,
Muzaffar Nagar, UP Panaji, Goa
Represented
Assessee by: Mr Shrinivas Nayak & Mr Narcinva Lotlikar ['Ld. AR']
Revenue by: Mr Renga Rajan & Mr Kailash Gaikawad ['Ld. DR']
Date of conclusive Hearing : 18/02/2026 & 27/03/2026
Date of Pronouncement : 27/03/2026
ITAT-Panaji Page 1 of 32
IT(SS)A No. 002 to 005 & 008 to 009 & 011/PAN/2019
And ITA No. 001/PAN/2020,
ORDER
PER BENCH(6:2);
The captioned bunch of eight appeals are filed by the different assessees u/s 253(1) of the Income-tax Act, 1961 ['the Act'] which impugns respective separate orders passed u/s 250 of the Act by the Commissioner of Income Tax Appeals-2, Panaji Goa ['Ld. CIT(A)'] which in turn dealt with respective separate orders passed by the Asstt. Commissioner of Income Tax, Central Circle, Panaji Goa ['Ld. AO'] u/s 153A r.w.s 143(3) of the Act anent to two assessment years as captioned ['AYs'].
2. Since the facts and issue being similar & identical assailed in this bunch of appeals is based upon and arising out of common search, on rival party's common request these appeals for the sake of brevity & convenience are heard together for being disposed of by this common & consolidated order.
3. At the outset of the hearing, the Ld. AR candidly brought to our attention that, IT(SS)A No. 002 to 005, 008 to 009 & 011/PAN/2019 were earlier disposed of by Ld. Co-ordinate bench ITAT-Panaji Page 2 of 32 IT(SS)A No. 002 to 005 & 008 to 009 & 011/PAN/2019 And ITA No. 001/PAN/2020, whereby former appeals were dismissed ex-parte vide common & consolidated order dt. 18/07/2023. Subsequently on miscellaneous applications ['MA'] these appeals vide common & consolidated order dt. 21/03/2025 were recalled with a restriction to adjudicate on merits after providing reasonable opportunity of being heard. The restriction placed while recalling the ex-parte order laid in para 6 to 8 since shall drive the scope of present adjudication therefore is reproduced herein as;
6. From the order sheet entries of Main Appeals, we note that, against the respective orders of first appellate authority passed u/s 250 of the Act, these captioned assessees had instituted separate appeals which were registered on 12/03/2020. By the order sheet entry dt. 28/06/2023 these appeals were fixed for hearing on 14/07/2023. In-spite service of notice, none appeared for hearing. Consequently, the Tribunal in the absence of assessees proceeded ex-parte u/r 24 of ITAT-Rules and disposed of the matter on merits following the decision of Hon'ble Kolkata High Court in the case of 'PCIT Vs Swati Bajaj' [2022, 446 ITR 56 (Cal)].
7. We note that, these applicants as well as their appointed common counsel were under bonafied belief that, since it was a first scheduled hearing and since the application for adjournment is submitted prior to the date of scheduled hearing, ITAT-Panaji Page 3 of 32 IT(SS)A No. 002 to 005 & 008 to 009 & 011/PAN/2019 And ITA No. 001/PAN/2020, the Tribunal adhering to principle of natural justice would grant an adjournment and cases would be re-scheduled for hearing again. We find there is nothing on record to dismantle the applicants former bonafide belief. Further, from the perusal of records and common reasons explicated by the applicants convincingly suggest that non-prosecution of main appeals by these applicant-assessees were purely undeliberate and non- appearance by their appointed counsel on the scheduled hearing of those main appeal was also accidental. The ex-parte dismissal of main appeals by the Tribunal was also accidental as the letter of adjournment claimed to have been submitted were neither found on record nor brought to notice by the registry if received any.
8. Having considered the facts of these MAs holistically, we find that the applicant assessees in the aforestated circumstance were deprived of reasonable opportunity, therefore in view of the 'St. Paul's Anglo Indian Education Society' [2003, 262 ITR 377 (Pat)]', and 'Raheem Shah & ANR Vs Govind Singh & Ors' [2023 10 SCR 913 (SC)] the applicant assessees deserves a fair & reasonable opportunity to present their cases on merits, which could only be possible if the former common & consolidate ex-parte order is recalled and respective main appeals are posted for hearing. In view of former discussion & for the stated reasons, in the interest of justice, we recall the ex- parte order of the Tribunal dt. 18/07/2023 and dispensing with issue of separate notice post the respective main appeals for hearing on the following dates; . . . .
ITAT-Panaji Page 4 of 32
IT(SS)A No. 002 to 005 & 008 to 009 & 011/PAN/2019 And ITA No. 001/PAN/2020,
4. We have noted the aforestated restriction and considering the limitation we have advanced accordingly on merits of the impugned additions and heard the rival party's common arguments, submissions, and counter arguments/rebuttal laid in the course of physical hearing and subject to rule 18 of ITAT-Rules, 1963 perused the material placed on records and considered the facts in the light of settled position of law which were forewarned to the respective litigant party for rebuttal. We also necessarily make a mention that, in progressing these matters together on merits, the IT(SS)A No. 002/PAN/2019 was taken as lead case/assessee for adjudication along-with ITA No. 001/PAN/2020. Resultantly our adjudication laid in succeeding paragraphs (except discretely laid if any) shall mutatis-mutandis apply to remaining all appeals and be read as such unless specifically stated otherwise. A. IT(SS)A No. 002/PAN/2019 [Lead Case/Assessee]:
5. Succinctly stated pertinent facts of the lead case are that; 5.1 The assessee is an individual and was earning salary income from M/s Mohit Ispat Ltd., M/s Goa Ispat Ltd. etc. For AY 2012- ITAT-Panaji Page 5 of 32 IT(SS)A No. 002 to 005 & 008 to 009 & 011/PAN/2019 And ITA No. 001/PAN/2020, 13 assessee filed his return of income u/s 139 of the Act on 28/03/2014 declaring total income of ₹14,48,100/- including a claim therein for exempt long-term capital gain ['LTCG'] of ₹1,68,06,614/- u/s 10(38) of the Act. The said return was processed summarily u/s 143(1) of the Act.
5.2 A search action u/s 132 of the Act was carried out on the assessee, his family members & connected companies on 10/02/2016 wherein certain incriminating materials ['IMs'] were found & seized and pursuant thereto vide order u/s 127 of the Act the assessee's case was centralised. In pursuance of such search and on the basis of IMs, the Ld. AO vide notice 14/02/2017 subjected the case of the assessee for re-assessment u/s 153A of the Act. In response thereto the assessee filed a return u/s 153A of the Act on 19/03/2017 declaring income of ₹14,48,100/- and also maintaining therein the claim for even amount of exempt LTCG of ₹1,68,06,614/- u/s 10(38) of the Act as was claimed in the return of income filed u/s 139 of the Act. ITAT-Panaji Page 6 of 32
IT(SS)A No. 002 to 005 & 008 to 009 & 011/PAN/2019 And ITA No. 001/PAN/2020, 5.3 The said 153A return was then selected for scrutiny vide notice dt. 26/09/2017 issued u/s 143(2) of the Act and on the basis of IMs a consequential assessment after obtaining prior approval from competent authority was completed wherein inter- alia claim for exempt LTCG was denied as bogus and a consequential addition of ₹1,72,06,614/- representing gross sale consideration received on sale of 40000 (Qty) equity shares of 'M/s Turbotech Engineering Limited' ['TEL'], was made as unexplained cash credit u/s 68 of the Act. In result the total income of the assessee was assessed to tax at ₹2,28,36,042/- by an order dt. 27/12/2017 framed u/s 153A r.w.s. 143(3) of the Act.
5.4 Similarly, for the AY 2014-15 on the basis of same IMs after obtaining like approval the Ld. AO inter-alia denied the claim for exempt LTCG as bogus and added the gross sale consideration of ₹89,87,090/- received on sale of balance 20,000 (Qty) equity shares of TEL, as unexplained cash credit u/s 68 of the Act. In result the total income of the assessee for AY 2014- ITAT-Panaji Page 7 of 32 IT(SS)A No. 002 to 005 & 008 to 009 & 011/PAN/2019 And ITA No. 001/PAN/2020, 15 was assessed to tax at ₹1,31,04,508/- by separate order of even date framed u/s 153A r.w.s. 143(3) of the Act. [Stated for both the years (Sr no 2 &3) for completeness of lead assessee].
5.5 Aggrieved assessee assailed the former solitary addition and the assessment order as such in an appeal before Ld. CIT(A) filed u/s 246A r.w.s. 249 of the Act, however remained unsuccessful in obtaining any relief.
5.6 Aggrieved by the order of Ld. CIT(A) dt. 06/11/2019 ['impugned order'] the assessee filed an appeal u/s 253(1) of the Act. So is the case of other year of the lead assessee and same is the case in other appeals as tabulated at Sr No. 3 to 8.
6. Since rival parties commonly reiterated their version as were laid & taken in both the tax proceedings below, we therefore without duplicating them in verbatim essentially noted that, in all along in the proceedings before the tax authorities below the appellant assessee claimed to have purchased of 60,000 equity shares of TEL of face value of ₹10/- ['FV'] at ₹10/- each on ITAT-Panaji Page 8 of 32 IT(SS)A No. 002 to 005 & 008 to 009 & 011/PAN/2019 And ITA No. 001/PAN/2020, 29/11/2011 (i.e. purchased at par). These shares stated to have been purchased off market from broker 'Corporate Commodity Broker Pvt. Ltd.' ['CCBPL'] on private placement or preferential allotment basis. The consideration for purchase of these equity shares were claimed to have paid in 'cash' and not through banking channels. Very importantly the delivery of these share were taken in physical/paper form. These total 60,000 equity shares later in the month of February 2013 was claimed to have converted in dematerialisation form ['Demat'] so as to enable the appellant assessee to sell them on exchange namely Bombay Stock Exchange ['BSE'] as and when required. As the matter of immediate fact, out of these 60,000 (Qty) equity shares purchased, the appellant sold 2/3 of his holding i.e. 40,000 (Qty) of equity shares (immediately after demating the shares) in February & March 2013 for a total consideration of ₹1,72,06,614/- (AY 2013-14) and balance 1/3 holding in equity shares i.e. 20,000 (Qty) were sold in June & September, 2013 for a total consideration of ₹1,31,04,508/-(AY 2014-15). ITAT-Panaji Page 9 of 32
IT(SS)A No. 002 to 005 & 008 to 009 & 011/PAN/2019 And ITA No. 001/PAN/2020,
7. We also noted from the observation of tax authorities & appellant's confirmation that, the TEL had no business or much less business and was trading at BSE as penny stock i.e., trading below the price ₹ 10/-. The IMs found & seized in the course of search action marked as 'A/MIL/10' revealed to the Revenue that, the appellant along with his family members & Sumitra Devi etc., paid a sum of ₹1,40,00,000/- to Mr Sanjay Garg ['SG'] in cash as commission for providing TIPS in relation to dealing in shares of TEL. The appellant & his family members along- with Sumitra Devi on a statement recorded had accepted the commission so paid to Mr SG as incurred in relation to purchase & sale of equity shares of TEL. The source of such commission paid in cash not been explained thus remained unexplained. Therefore, the appellant assessee in his return furnished u/s 153A for AY 2014-15 declared the proportionate commission of ₹21,78,400/- as unexplained expenditure in relation purchase & sale of shares of 60,000 (Qty) equity shares of TEL and same was assessed accordingly.
ITAT-Panaji Page 10 of 32
IT(SS)A No. 002 to 005 & 008 to 009 & 011/PAN/2019 And ITA No. 001/PAN/2020,
8. We find that, before the assessing officer there were hardly any cogent document to establish the appellant's former 60,000 (Qty) equity shares purchase transaction as genuine and in real time but doctored to fit the provisions of section 10(38) of the Act. The appellant's case in first appeal before the Ld. CIT(A) was indifferent therefore there was occasion to grant any relief. We have gone through the assessment as well impugned order carefully and considered the arguments, submission of rival parties. Although we are in complete agreement with the findings given and conclusion drawn by the tax authorities below, however in view of the ratio laid by the Hon'ble Jurisdictional High Court in 'CIT Vs Zuari Finance Ltd.' [2004, 271 ITR 538] wherein their hon'ble lordship have upheld the power of the Tribunal to give own findings independent of findings given by the tax authorities below and also to reach own conclusion without limiting to the conclusion reached by tax authorities below, we advanced further in very terms. On the strength of such judicial precedents (supra) we are mindful to state that, the 'TEL' ITAT-Panaji Page 11 of 32 IT(SS)A No. 002 to 005 & 008 to 009 & 011/PAN/2019 And ITA No. 001/PAN/2020, was listed on BSE much before date of purchase of equity share by the appellant. It is also worthy to note that, as on that date the TEL was trading much below the face value of ₹10/-, therefore when asked, the appellant could hardly have any answer as to why one would buy a listed share at FV when it was trading at BSE much below FV i.e., ₹1 to ₹5 (approx.). Further the appellant submission that, he had acted only on the basis of TIPS given by Mr SG in the absence of any paper trail such plea in our considered view beyond an iota of doubt do not completely dislodge existence of pre-dated arrangement. We say so because, for the period 18th July 2012 to 17th October 2012 the scrip was never traded on exchange and insofar as the 18th October, 2012 to 17th June, 2013 is concerned the price were rigged from ₹37 to ₹500 (approx.). And it is not surprising note that, thereafter without much (Qty) traded the TEL scrip was collapsed like a house of cards from ₹500 to ₹2 (approx.) by January 2015, with much less volume therefore clearly suggestive of rigging which finally confirmed by the SEBI as fraudulent manipulation. ITAT-Panaji Page 12 of 32
IT(SS)A No. 002 to 005 & 008 to 009 & 011/PAN/2019 And ITA No. 001/PAN/2020,
9. Insofar as the TEL financial health & operation are concerned, there was hardly any operations carried out in any immediate earlier & later years and was reporting losses for FY 2013, FY 2014, and FY 2015 as of ₹4Lakhs, ₹10Lakhs and ₹13Lakhs, respectively. As noted by the Ld. AO that, the TEL had no dealing and corporate announcements made at BSE were in only nature of announcements of financial results, book closure, General Meetings, and shareholding pattern etc.
10. From the Ld. Co-ordinate bench's decisions, it is also noted that, the Ld. security market regulator suspended the trading of TEL scrip in Jan 2015 and finally vide its order 'EAD- 9/VKV/GSS/2019-20/6861-6869 dt. 18/02/2020' adjudicated that TEL was indulged in fraudulent, unfair, and manipulative acts in contravention of provision of SEBI-Act, 1992 and applicable regulations thereof. When this was pointed by the Revenue, the appellant contrarily submitted orally that; the same security market regulator SEBI vide order dt. 24/11/2014 did pass no ITAT-Panaji Page 13 of 32 IT(SS)A No. 002 to 005 & 008 to 009 & 011/PAN/2019 And ITA No. 001/PAN/2020, adverse order against the CCBPL the broker/exit provider from whom the alleged equity shares of TEL were purchased by the appellant and other family members including Sumitra Devi. The Revenue's negation however turned the face of adjudication straight when it was countered that, in the said proceedings the CCBPL broker/exit provider had in response to show cause notice confirmed to the Ld. SBI that, it had divested its entire shareholding 29,50,000 (Qty) equity shares of TEL in the month of October 2012 only. This reply of CCBPL recorded by the Ld. SEBI sufficiently in our view concretely disproves the appellant's claim of having purchased 60,000 (Qty) of equity shares of TEL from CCBPL for cash on 29/11/2011 off the market. Conversely in the absence of complete legal, valid & convincing documents/evidence, it goes without saying that, the appellant had doctored the material for placing them before the tax authorities to establish the LTCG claim as genuine, which although and very rightly not believed to be true & correct for the purpose by the tax authorities below therefore we too. ITAT-Panaji Page 14 of 32
IT(SS)A No. 002 to 005 & 008 to 009 & 011/PAN/2019 And ITA No. 001/PAN/2020,
11. The perusal of record and consideration of arguments, submission and counter arguments it came out that, the only basis of appellant's claim the LTCG derived by him was not bogus but was genuine is because that the assessees had no clue or any idea or knowledge whatsoever about the price rigging or sham operations taking place with respect to the TEL scrip. The appellant was never a party to the price-rigging but an innocent investor & thus the beneficiary. The appellant adjunctively claimed that commission at 8% paid to Mr SG was attributable to insider TIP given by him as professional services. It was also stated that, the payment of commission @8% of total sale consideration was always subject to fetching returns and not merely for assisting the appellant in acquiring those shares off the market for cash. This was disproved by the Revenue in the evince of statement of Mr Anil Khema ['AK'] an entry operator recorded by the DDIT(Inv), Kolkata who confirmed to have arranged for accommodation entries through scrips of TEL, who also confirmed that the share price of TEL was rigged through artificial synchronised trades. ITAT-Panaji Page 15 of 32
IT(SS)A No. 002 to 005 & 008 to 009 & 011/PAN/2019 And ITA No. 001/PAN/2020,
12. The respondent with the help of IMs and in the complete absence of 'Demat' account statement was successful in proving that there was unexplained source utilized for the payment of commission to Mr SG in relation to arrangement to convert unaccounted money through trading in penny stock by (i) pre- dated, (ii) backdoor (iii) off market cash purchase transaction. These facts per-se in view of juridical precedents are sufficient to draw the conclusion that, the entire transaction was not genuine but camouflaged, bogus and dubious to evade taxes.
13. Now coming to turning down the request for cross verification sought by appellant. In doing so the Ld. AO drawn strength from 'Dhakeshwari Cotton Mills Vs CIT' [1954, 26 ITR 775], so is the Ld. CIT(A). Though we do not find any inconsistency in the action tax authorities in doing so in the light of various judicial precedents, however it is imperative to state in reinforcing the action that, the breach of audi alteram partem rule as laid in binding precedents cannot by itself, lead to the ITAT-Panaji Page 16 of 32 IT(SS)A No. 002 to 005 & 008 to 009 & 011/PAN/2019 And ITA No. 001/PAN/2020, conclusion that prejudice is thereby always caused. Where procedural and/or substantive provisions of law embodied the principles of natural justice, their infraction per-se does not lead to invalidity of the order passed by the adjudicating authorities. The Hon'ble Lordships in 'SBI Vs MJ James' [2021, INSC 732] referring to the decision in the case of 'State of UP Vs Sudhir Kumar Singh' [2020, SCC Online SC 847], in the context of held that the 'prejudice' exception must be more than a mere apprehension or even a reasonable suspicion of a litigant, it should exist as a matter of fact or to be cast upon a definite inference of likelihood of prejudice flowing from the non- observance of natural justice. Therefore, the appellant have to specifically point out as to how he was prejudiced on account of non-furnishing of the investigation report in its entirety, failure to produce the persons from whom the statements were recorded for being cross examined would cause prejudice to the assessee as nowhere in the report the names of the assessees feature but the company which scrip used for artificial/manipulative trading. ITAT-Panaji Page 17 of 32
IT(SS)A No. 002 to 005 & 008 to 009 & 011/PAN/2019 And ITA No. 001/PAN/2020,
14. In the context present tax litigation, it shall be essential to note a significant factor that the investigation by DDIT (Inv) has not commenced from the individuals, but it has commenced who had dealt with the penny stocks, concept of working backwards. Therefore, there has been absolute anonymity of the appellant assessee in the process of investigation. The endeavour of the Revenue was to examine the modus operandi adopted and, in that process, the Revenue successfully identified the appellant assessees as one of the beneficiaries on account of such 'modus operandi.' Therefore, considering the factual scenario no prejudice has been established to the appellant assessee by (i) not furnishing the investigation report (ii) not furnishing order of SEBI and (iii) not making the persons available for cross examination as admitted by the department in substantial number of cases the assessees have not been specifically indicted by those persons from whom statements have been recorded but all such scrips used for artificial, manipulative and synchronised trades with the sole object of earning bogus LTCG etc. ITAT-Panaji Page 18 of 32 IT(SS)A No. 002 to 005 & 008 to 009 & 011/PAN/2019 And ITA No. 001/PAN/2020,
15. The nature of transactions executed, the frequency with which such transactions are undertaken, the value of the transactions, the conditions then prevailing in the market are some of the factors which go to show the intention of the parties. This list of factors, in the very nature of things, cannot be exhaustive. Any one factor may or may not be decisive and it is from the cumulative effect of factors are that a reasonable inference can very well be drawn. It is trite and fundamental principle of law that proof of an allegation levelled against a person may be in the form of direct substantive evidence or, as in many cases, such proof may have to be inferred by a logical process of reasoning from the totality of the attending facts and circumstances surrounding the allegations/charges made and levelled. While direct evidence is a more certain basis to come to reasonable conclusion, yet, in the absence thereof the adjudicating authorities cannot be helpless. It is our judicial duty to take note of the immediate and proximate facts and circumstances surrounding the events on which the ITAT-Panaji Page 19 of 32 IT(SS)A No. 002 to 005 & 008 to 009 & 011/PAN/2019 And ITA No. 001/PAN/2020, charges/allegations are founded and to reach what would appear to the tax authorities to be a reasonable conclusion therefrom. The test would always be that what inferential process that a reasonable/prudent man would adopt to arrive at a conclusion. Further the findings that have been gathered from various circumstances for instance connection between the appellant assessees, Mr SG broker middle man , Mr AK broker & entry operator and the CCDPL broker/exit provider, overall nature of transaction/trading in the scrip, particulars of cash acquisition/purchases & off market purchase and their immediate conversion (though not proved) & sell on exchange, complete absence of Demat account statement and unsatisfactory explanation from the appellant for behaving opposite to that of a reasonable buyer who buys the scrip of those companies with strong & healthy fundamentals etc., leads to the conclusion that the transaction by the appellant pre-arranged, not at all genuine but bogus and dubious and carried out with a sole intent show bogus LTCG earnings.
ITAT-Panaji Page 20 of 32
IT(SS)A No. 002 to 005 & 008 to 009 & 011/PAN/2019 And ITA No. 001/PAN/2020,
16. Verbatimly similar facts & circumstance including the scrip of 'penny stock' i.e. TEL came for consideration before the Ld. Co-ordinate bench in the case of 'Abhishek Gupta Vs ITO' [2023, 147 Taxmann.com 21] wherein the Ld. Co-ordinate bench after threadbare discussion of various case laws relied by assessee & Revenue (as relied by rival parties in the present bunch of appeals), dismissed the assessee's appeal following the ratio laid down by the Hon'ble High Court of Kolkata in 'PCIT Vs Swati Bajaj' [2022, 288 Taxman 403(Kol)], reliance was also placed in case of 'Sumati Dayal v. CIT' [1995, 214 ITR 80 (SC)], & 'CIT Vs Durga Prasad More' [1971, 82 ITR 540 (SC)]. The appellant could hardly lay any decision contrary to deprecate application of ratio laid therein and consequentially in the decision of 'PCIT Vs Swati Bajaj' [2022, 446 ITR 56 (Kol)]. The Ld. AR could hardly distinguish and agitate the non-applicability of Ld. Co- ordinate bench decision in the present bunch of appeals. On the other hand, there is no reason before us to deviate from the former view taken by the Ld. Co-Ordinate bench.
ITAT-Panaji Page 21 of 32
IT(SS)A No. 002 to 005 & 008 to 009 & 011/PAN/2019 And ITA No. 001/PAN/2020,
17. The appellant's last-second-snag plea that, commission paid to Mr SG on purchase/sale of equity share of TEL though accepted as unexplained expenditure and declared as undisclosed income u/s 69A of the Act such acceptance cannot per-se prove or establishes the purchase/sale of equity share transaction as bogus finds no merit in view of the Hon'ble Jurisdictional Bombay High Court in the case of 'Ramchandra Dada Shinde Vs DCIT' [2025, 173 taxmann.com 654 (Bom)] wherein their hon'ble lordships have categorically held that, there may be an explanation about cash seized in the course of search & seizure action u/s 132 of the Act but if the assessee fails to co-relate the seized cash with acceptable reasonableness, then impugned addition made u/s 68 of the Act as unexplained cash credit is justified. Drawing the strength from former judicial precedents, the appellant having accepted the expenditure incurred in relation to impugned trading of TEL shares fail to explain the veracity of transaction as a whole. Therefore, in the absence of evidence and acceptable reasonable explanation sufficient to establish the ITAT-Panaji Page 22 of 32 IT(SS)A No. 002 to 005 & 008 to 009 & 011/PAN/2019 And ITA No. 001/PAN/2020, impugned transaction as genuine, the same is held as bogus by the tax authorities below is hereby approved in very terms.
18. The facts of the present case dissimilar to the case came before the Hon'ble Jurisdictional High Court in 'PCIT Vs Indravadan Jain HUF' [2023, 463 ITR 711 (Bom)], where equity shares were purchased by assessee on floor of stock exchange and not from broker, payment was made through banking channel, deliveries were directly taken in DEMAT account where shares remained for more than one year, contract notes were issued and shares were also sold on stock exchange. Indeed the ratio laid by their Hon'ble lordship goes against the appellant for all the negative attributes of his case that; (i) shares were not purchased on the floor of exchange but from the broker & off the market (ii) the broker did not confirm such sale, rather confirmed before the Ld. SEBI that it had sold its entire shareholding in 2012 as against the appellant's claim acquiring in 2011 (iii) the payment was not through banking channel but in ITAT-Panaji Page 23 of 32 IT(SS)A No. 002 to 005 & 008 to 009 & 011/PAN/2019 And ITA No. 001/PAN/2020, cash (iv) even no cogent document whatsoever produce to discharge effectively the claim of purchase made by the appellant
(v) complete absence of contract notes (vi) the delivery of shares were not directly into DEMAT a/c but physical deliveries. The appellant could hardly contest the non-applicability of former binding judicial precedents. Per contra the respondent pressed into service the very same ratio for application since it negates all the essential characteristic of case before their Hon'ble lordship.
19. We also note that, the appellant concealed all such material facts and laid no evidential documents which could have enabled the tax authorities to vouch the claim of the appellant that the transaction indeed was not bogus but genuine. Thus, significant facts and essential documents capable of influencing adjudication were never fully placed by the appellant before any of the forum including the present proceedings, therefore we inclined to invoke the 'doctrine of fraud' and at the threshold reject all the plea taken by the appellant. We note that, the Mr ITAT-Panaji Page 24 of 32 IT(SS)A No. 002 to 005 & 008 to 009 & 011/PAN/2019 And ITA No. 001/PAN/2020, AK a broker/entry operator on the statement recorded oath confirmed to have given accommodation entries in relation of TEL purchase transaction to the appellant & his family members (other appellant in the present bunch of appeals), thus in view of the Hon'ble Jurisdictional Bombay High Court decision in 'PCIT Vs Buniyad Chemical' [2025, 304 Taxman 560 (Bom)] such statement on oath itself confirms the commission of fraud not by one party thereto but all the parties of such transaction. The appellant could hardly refute the bench's view by placing contrary decision.
20. Insofar as the application of higher taxation u/s 115BBE is concerned, the said provision prescribes double the rate of normal taxation and as such they are penal in nature beside penalty prescribed u/s 271 of the Act. A reference can be made to the judgement of the Hon'ble Supreme Court in 'SEBI Vs Shri Ram Mutual Fund' [2006, 68 SCL 216(SC)], wherein Hon'ble SC laid that 'the penal provisions of the law are attracted as soon ITAT-Panaji Page 25 of 32 IT(SS)A No. 002 to 005 & 008 to 009 & 011/PAN/2019 And ITA No. 001/PAN/2020, as the contravention of the statutory obligation as contemplated in statute is established and hence the intention of the parties committing such violation becomes wholly irrelevant. In the present case, by denying the claim of exemption made u/s 10(38) of the Act consequential addition was brought to tax as unexplained cash credit by invoking deeming fiction, therefore there is complete merit in application of provisions of section 115BBE of the Act. For the reason, the plea for normal taxation could hardly be entertained.
21. In view of aforestated discussion and judicial precedents we find much less error in any of the key findings rendered by tax authorities below in coming to conclude that the trading of equity shares of TEL by the appellant is pre-arranged thus bogus and in consequence denied the exemption claimed u/s 10(38) of the Act. For the reason we countenance the findings & conclusion drawn in very terms, and in result dismissed the appeal of the assessee. The grounds thus stands adjudicated accordingly. ITAT-Panaji Page 26 of 32
IT(SS)A No. 002 to 005 & 008 to 009 & 011/PAN/2019 And ITA No. 001/PAN/2020,
22. The other appeals listed in Sr 2 to 7 are also stands dismissed in very terms of lead case laid hereinbefore.
23. Having decided these appeals on merits, before we depart it shall be essential to mention the conduct of the captioned appellant assessee listed from Sr 1 to 7; (i) firstly in-spite of service of notice, appellant in the first round opted out from prosecuting the appeal, owning to which the Ld. Co-ordinate bench proceeded ex-parte u/r 24 (supra) and adjudicated the issue in the light of settled position of law and in consequence dismissed the appeals on merits. (ii) while recalling these matters vide order dt. on 21/03/2025, considering the request of Ld. AR for urgency and as were tagged as 'old-appeals', these matter by such order itself were listed for hearing on 02nd to 05th June 2025 but appellant sought adjournment without much sufficient reason. (iii) Subsequently these matters were listed for hearing on 13/08/2025, 08/10/2025 & 11/11/2025 but the appellant continued to seek adjournment for no reasonable cause. (iv) When the failure to represent the case on merit continued even on 8th scheduled hearing dt. 21/01/2026 the bench ITAT-Panaji Page 27 of 32 IT(SS)A No. 002 to 005 & 008 to 009 & 011/PAN/2019 And ITA No. 001/PAN/2020, thought fit to invoke rule 24 (supra) and with a notice to the appellant the bench scheduled the hearing on 17/02/2026 and provided last opportunity. However, the same remained futile too. In view of the aforestated facts & circumstances these appeals finally adjourned to 18/02/2026 and heard on merits in party after considering the reply obtained through RTI application which was placed on record. The conduct of appellants in these matters glaring suggested [to the author of this order] that, the appellant resorted to 'bench hunting or bench shopping' with a sole intent to secure the desire relief. This conduct in view of the Hon'ble Courts is considered to be abuse of the judicial process because it undermines the integrity and impartially of judicial system, generates a risk of inconsistent adjudication for similar parties on similar facts. Therefore, the conduct as witnessed in the referred bunch is hereby condemned without levying any additional cost/fine therefore as the appellant already exposed to accelerated taxation u/s 115BBE of the Act and consequential penalties if any to be levied by the Revenue in accordance with law. ITAT-Panaji Page 28 of 32
IT(SS)A No. 002 to 005 & 008 to 009 & 011/PAN/2019 And ITA No. 001/PAN/2020, B. ITA 001/PAN/2020
24. Insofar as this appellant assessee is concerned pithily stated pertinent facts of the case are that;
24.2 The assessee is an individual and a partner of M/s Mathiyan Construction etc., and was assessed to tax in respect of income received in the form of salary/remuneration & interest from such partnership firm and other income etc. The assessee for the year under consideration filed her belated return of income u/s 139 of the Act on 31/03/2015 declaring total income of ₹3,22,720/- including a claim therein for exempt long-term capital gain ['LTCG'] of ₹69,80,721/- u/s 10(38) of the Act.
24.3 A search & seizure action u/s 132 of the Act was carried out on the assessee on 10/02/2016 wherein certain incriminating materials ['IMs'] were found & seized and pursuant thereto vide order u/s 127 of the Act the case of the assessee centralised to Ld. AO. In pursuance of such search action & centralisation, the Ld. AO vide notice 27/09/2017 subjected the case of the assessee for re-assessment u/s 153A of ITAT-Panaji Page 29 of 32 IT(SS)A No. 002 to 005 & 008 to 009 & 011/PAN/2019 And ITA No. 001/PAN/2020, the Act. In response thereto the assessee filed a fresh return u/s 153A of the Act on 31/10/2017 declaring thereby a revised income of ₹9,18,720/- but continued therein the claim for exempt LTCG of ₹69,80,721/- u/s 10(38) of the Act as was claimed by her in the return of income filed u/s 139 of the Act.
24.4 The said return was selected for scrutiny vide notice dt. 17/11/2017 issued u/s 143(2) of the Act and a consequential assessment on the basis of IMs was completed wherein claim for exempt LTCG was denied as bogus and a consequential addition of ₹74,40,285/- representing gross sale consideration received on sale of 45000 equity shares of 'M/s Turbotech Engineering Limited' ['TEL'], was made as unexplained cash credit u/s 68 of the Act and in result after obtaining prior approval from the competent authority the total income of the assessee was assessed to tax at ₹83,59,000/- by an order dt. 27/12/2017 framed u/s 153A r.w.s. 143(3) of the Act. Aggrieved assessee assailed the former solitary addition and the assessment order as such in an appeal ITAT-Panaji Page 30 of 32 IT(SS)A No. 002 to 005 & 008 to 009 & 011/PAN/2019 And ITA No. 001/PAN/2020, before Ld. CIT(A) filed u/s 246A r.w.s. 249 of the Act, however remained unsuccessful in obtaining any relief.
24.5 Aggrieved by the order of Ld. CIT(A) dt. 06/11/2019 ['impugned order'] the assessee filed an appeal u/s 253(1) of the Act on even grounds as raised in the captioned preceding appeals including legal ground.
25. After hearing rival party's common submission on merits, we adopt the same observation, discussion and findings laid in the lead case/assessee and placing equal reliance judicial precedents (supra) therein, approve the action of tax authorities in holding LTCG claim as bogus, thus hereby confirm the denial of exemption claimed by the appellant u/s 10(38) of the Act. In consequence we upheld the order of Ld. CIT(A) and dismissed all the grounds raised on merits.
26. Insofar as the legal ground raised challenging the order of assessment made by the ld. AO u/s 143(3) r.w.s. 153A of the Income Tax Act, 1961 and sustained by ld. CIT(A), is passed ITAT-Panaji Page 31 of 32 IT(SS)A No. 002 to 005 & 008 to 009 & 011/PAN/2019 And ITA No. 001/PAN/2020, without jurisdiction, suffers from infirmity, is bad in law and passed without following the principle of natural justice is concerned, in this context it shall suffice to state that once the act of appellant proved or established as fraud, every other thing including legal remedy otherwise available in any of the provisions of the Act and in any other law (civil or criminal) shall stands divested. Fraud is thus an extrinsic collateral act which vitiates all judicial acts, whether in rem or in personam. For the reasons, the appellant deserves no relief on legal ground, ergo stands dismissed.
27. In result the appeal of the assessee stands DIMISSED.
28. In result, these all eight appeals are DISMISSED in very terms. In terms of rule 34 of ITAT Rules, 1963 the order pronounced in the open court on date mentioned hereinbefore.
-S/d- -S/d-
PAVAN KUMAR GADALE G. D. PADMAHSHALI
JUDICIAL MEMBER ACCOUNTANT MEMBER
Panaji/Dt: 27th March, 2026.
Copy of the Order forwarded to :
1. The Appellant. 2. The Respondent. 3. The CIT(A)/NFAC Concerned
4. PCIT Concerned 5. DR, ITAT, Panaji Bench, Goa 6. Guard File
By Order,
Sr. Private Secretary / AR ITAT, Panaji.
ITAT-Panaji Page 32 of 32