The Pr. Commissioner Of Income Tax 1 vs Shri Bankat Nyati
2024 Latest Caselaw 16269 MP

Madhya Pradesh High Court

The Pr. Commissioner Of Income Tax 1 vs Shri Bankat Nyati on 30 May, 2024

Author: Sushrut Arvind Dharmadhikari

Bench: Sushrut Arvind Dharmadhikari

                                                             1
                          IN     THE       HIGH COURT OF MADHYA PRADESH
                                                 AT INDORE
                                                 BEFORE
                          HON'BLE SHRI JUSTICE SUSHRUT ARVIND DHARMADHIKARI
                                                    &
                                 HON'BLE SHRI JUSTICE GAJENDRA SINGH
                                                 ON THE 30 th OF MAY, 2024
                                           INCOME TAX APPEAL No. 41 of 2022

                         BETWEEN:-
                         THE PR. COMMISSIONER OF INCOME TAX 1 THE PR.
                         COMMISSIONER OF INCOME TAX 1 AAYKAR BHAWAN,
                         NEAR WHITE CHURCH (MADHYA PRADESH)

                                                                                           .....PETITIONER
                         (BY MS. VEENA MANDLIK-ADVOCATE)

                         AND
                         SHRI BANKAT NYATI 4, NYATI HOUSE, MANDI ROAD,
                         DHAMNOD (MADHYA PRADESH)

                                                                                         .....RESPONDENTS
                         (BY SHRI YATISH KUMAR LAAD-ADVOCATE)

                               This appeal coming on for orders this day, Justice Sushrut Arvind
                         Dharmadhikari passed the following:
                                                              ORDER

This appeal is filed by the appellant under Section 260A of the Income Tax Act, 1961 (hereinafter referred to as 'the Act of 1961') being aggrieved by the order dated 02.08.2021 passed by the Income Tax Appellate Tribunal (ITAT), Bench Indore in ITA No.509/Ind/2018 for the Assessment Year 2014

- 15 proposing following substantial question of laws in this appeal:-

1] Whether on facts and within the legal spectrum of the case, the ITAT was justified in law in deleting the addition made by the Assessing Officer, ignoring the findings of Investigation Wing, Kolkata that M/s Sunrise Asian Ltd. was clearly established as a bogus penny stock script

company which was used for claiming bogus Long Term Capital Gain as exempt U/s 10(38) of the Income Tax Act, 1961 ?

2] Whether on facts and within the legal spectrum of the case, the ITAT was justified in law not appreciating that the script M/s Sunrise Asian Limited has been involved in manipulation of prices and for providing accommodation entries, so that Bogus Long Term Capital Gain could be yielded and that such aspects have been duly confirmed by SEBI and that trading in the script ' Sunrise Asian Limited' had been suspended ? 3] Whether on facts and within the legal spectrum of the case, the ITAT was justified in law in deleting the aforesaid additions without determining the issue of price rigging categorically entailed in the aforesaid penny stock company and hence substantial question of law arises as per section 260A(6) of the Income Tax Act, 1961 ? 4] Whether on facts and within the legal spectrum of the case, the ITAT was justified in law in not appreciating the spirit and substance of the test of human probabilities as per the judgment of Hon'ble Apex Court in the case of Sumati Dayal V/s CIT (1995) 80 Taxman 89 (SC) in the instant case vis a vis astronomical increase in price of share and that too without any substantial business activity of profit earning apparatus ?

02. This issue came up for consideration in bunch of appeals, main case is ITA No.56 of 2021 and this Court has dismissed the appeals filed by the revenue vide common order dated 30.04.2024.

03. In view of the aforesaid, the present appeal is dismissed and the order dated 30.04.2024 passed in ITA No.56 of 2021 shall be applicable mutatis mutandis in the facts and circumstances of the present case also.

                           (S. A. DHARMADHIKARI)                                             (GAJENDRA SINGH)
                                    JUDGE                                                         JUDGE
                         Praveen