Anju Kesarwani vs Deputy Commissioner of Income Tax

PER VIKAS AWASTHY, JM:

This appeal by the assessee is directed against the order of Commissioner of Income-tax (Appeals)-30, New Delhi (hereinafter referred to as ‘the CIT (A)’) dated 15.09.2025, for the Assessment Year 2014-15.

At the outset, the Id. AR submitted that though the assessee has raised multiple grounds of appeal, inter alia challenging validity of reopening of assessment, however, at this stage he is pressing only Ground No. 4 of the appeal relating to confirmation of addition of Rs. 27,20,000/- u/s. 68 of the Income Tax Act, 1961 (hereinafter referred to as “the Act”). The learned AR submitted that the assessee had sold 4,000 shares of PMC Fincorp Ltd. through a recognized stock exchange and declared Short Term Capital Gain (STCG) of Rs. 8,59,559/-. The said STCG was duly disclosed in the return of income. The return filed by the assessee was processed under section 143(1) of the Act accepting the returned income. Thereafter, the assessment was reopened on the ground that the assessee had allegedly taken bogus entries in the garb of Long-Term Capital Gain (LTCG) on sale of shares. The learned AR clarified that though he is not pressing the grounds challenging the validity of reopening at this stage, the reasons recorded are factually incorrect. The assessee had in fact earned STCG, which was duly offered to tax. He reiterated that the capital gain on sale of shares was fully reflected in the computation of income and was accepted u/s.143(1) of the Act. The learned AR thus prayed for deletion of the addition made by the Assessing Officer under section 68 of the Act in reassessment proceedings, as the same results in duplication of income already offered to tax.

Per contra, Shri Manoj Kumar representing the department placed reliance on the assessment order and findings of the CIT(A).

It is an undisputed fact that during the period relevant to assessment year under appeal, the assessee sold shares of PMC Fincrop Ltd. and earned STCG thereon. A perusal of the computation of income reveals that the assessee has offered STCG to tax. It is further evident from computation of Income that no exempt income was claimed in respect of the said transaction. This factual position remains uncontroverted. Once the capital gain arising from sale of shares has been duly offered to tax, there is no justification for making addition u/s. 68 of the Act in respect of the same transaction. The addition effectively results in duplication of income already offered to tax. In light of above undisputed facts, assessee succeeds on ground no. 4 of appeal.

In so far as the other ground i.e. ground of appeal no. 1 to 3 assailing validity of reassessment proceedings, the same are not pressed at this stage, hence, are left open.

In the result, appeal of the assessee is allowed protanto.