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"4.1 The movement of the price of the company on BSE is also detailed below, that clearly reveals a pattern in the manipulation of the share price of the company: Turbotech Engg BSE: 504358 | NSE: | ISIN: INE764M01018 Historic data for the period: Apr-2013 to Mar-2014 on BSE Change Period High: 518.00 Period Low: 19.65 Change in market-cap:-94.91% Date Open High Low Close Mar 2014 28.80 28.80 19.65 19.65 Feb 2014 41.65 41.65 29.35 29.35 Jan 2014 65.55 65.55 42.45 42.45 Dec 2013 99.45 99.45 66.85 66.85 Nov 2013 148.25 148.25 101.45 101.45 Oct 2013 190.00 201.00 151.25 151.25 Sep 2013 145.10 190.60 145.10 190.25 Aug 2013 299.95 304.00 142.50 148.05 July 2013 491.30 512.00 282.90 290.65 June 2013 465.00 518.00 403.40 468.00 May 2013 483.80 498.00 427.30 453.90 Apr 2013 385.80 509.00 385.80 465.10 The AO observed that said company namely M/s Turbotech Engineering Ltd. was not having any income/revenue during the year under consideration and infact for last four years there was no revenue/income earned by said company namely M/s Turbotech Engineering Ltd. and there is a huge variation in price traded of share of M/s Turbotech Engineering Limited which varied from Rs. 19.65 to Rs. 518/- per share during financial year itself which is not supported by financials of the said company and there is no economic rationale or justification for such price movement in share prices of Turbotech Engineers Limited in last one year ranging from Rs. 19.65 to Rs. 518/- per share. Thus, as per AO there is no justification for such variation in share price of said company namely M/s.Turbotech Engineering Ltd. from Rs. 19.65 to Rs. 518 per share :- 10 -:
2014-15 , the assessee has sold 7900 shares of Turbotech Engineering Limited for Rs. 40,22,940/- , translating into long term capital gains of Rs. 39,77,886/- , which long term capital gains were claimed as an exempt u/s 10(38) of the 1961 Act . Thus, the share which were bought for merely Rs. 15800/- ( Rs. 2 per shareX 7900 shares ) in November 2011 are sold during previous year 2013-14 relevant to impugned ay: 2014-15 :- 16 -:
on 23.09.2013 and 22.11.2013 i.e. within a short span of 2 years at a huge profits translating into astronomical return/yield of more than 12500% per annum at a price of Rs. 509 per share. It is also observed that share price of said company Turbotech Engineering Ltd. fluctuated from Rs. 19.65 to Rs. 518 per share within the financial year 2013-14 itself . The assessee has sold share at a price of more than Rs. 500 per share during previous year 2013-14 relevant to ay: 2014-15, while purchase of said shares were made just two years back at Rs. 2 per share. It is pertinent to mention that assessee has no experience in dealing in share market and these transactions in shares of Turbotech Engineering Ltd. are solitary transactions undertaken by assessee and no transactions in shares were ever undertaken by assessee prior to and after the aforesaid alleged transactions in shares of Turbotech Engineering Ltd.. Investigations were conducted by various government and regulatory and enforcement authorities/agencies of Government of India which indicated that said company M/s Turbotech Engineering Ltd. is a company with little or no inherent value and its shares prices were rigged and manipulated with an intention of conversion of unaccounted money into apparently genuine income to claim exemption u/s 10(38) of the 1961 Act. We have also observed that the AO independently carried out enquires by issuing notices u/s 133(6) of the 1961 Act to Bombay Stock Exchange. The BSE replied that assessee has not dealt in any other shares except dealing in shares of Turbotech Engineering Ltd. . The assessee is not a regular buyer and seller in shares and except for this alleged :- 17 -:
transactions in Turbotech Engineering Ltd. , the assessee has not dealt within any other shares even prior to it or even post to these alleged transactions in Turbotech Engineering Ltd. . The assessee could not rebut this assertion of the authorities below. These are the only transactions in shares made by assessee in which she has claimed to have earned an exempt income of Rs. 39,77,886/- on a meager investment of Rs. 15,800/- in a short period of 2 years giving astronomical return of more than 12500% per annum , in dealing in shares of M/s Turbotech Engineering Ltd. . We have also observed that SEBI has also debarred/suspended this company namely M/s Turbotech Engineering Ltd. effective from 07.01.2015 until further orders from trading/dealings of its shares in stock exchanges. It has also emerged from inquiries conducted by AO that certain Kolkatta based companies having little or no means have bought entire shares of M/s Turbotech Engineering Ltd. and these companies acted in concert with entry operators and share brokers to rig/manipulate share price of Turbotech Engineering Ltd. with an intent to defraud Revenue. The AO has deeply analyzed Balance Sheet and Profit and Loss account of this company M/s Turbotech Engineering Ltd. for five years from year ended 31.03.2012 till year ended 31.03.2016 and it revealed that this company does not have any revenue/income and expenses in all these years . Its profits were almost nil or negligible during all these years. Its key financial years are extracted in assessment order passed by AO which we have also reproduced in preceding para's of this order (page 8-9). We have also carefully gone through the financial of this :- 18 -:
transactions in shares of Turbotech Engineering Ltd. were not bogus/sham transactions before the AO and rather it was a genuine transactions. The power of learned CIT(A) are co-terminus with powers of the AO and the assessee ought to have furnished necessary evidences and explanations before learned CIT(A) to prove that the transaction for purchase and sale of the shares were genuine .The assesse is claiming exemption by way of long term capital gains claimed by it to be earned on sale and purchase of Turbotech Engineering Ltd. by invoking provisions of Section 10(38) of the 1961 Act and onus is on the assessee to prove that these gains are genuine and assessee is entitled for exemption. The AO has not only relied upon investigations carried by other government agencies but has also conducted independent inquiries with BSE which also revealed that the prices of the shares of Turbotech Engineering Ltd. were rigged / manipulated with an intent to defraud revenue. The financials of said company M/s Turbotech Engineering Limited wherein there is no turnover/income earned and no expenses incurred by said company for last five years also does not support price variation of Rs. 19.65 per share to Rs. 518 per share within previous year 2013-14 relevant to ay: 2014-15, which clearly points to manipulation and rigging in share price of Turbotech Engineering Ltd. with malafide intention to defraud revenue. It is unbelievable that assessee having never dealt in share market will earn a yield / return of 12500% per annum within 2 years on her first dealing in stock market which also happened to be last dealing undertaken by assessee in stock market. The claim of the :- 20 -: