Rajesh Kumar ORDER
Rajesh Kumar, Member (A)
1. This appeal, at the instance of assessee for assessment year 2013-14, is directed against the order of ld. Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi dated 03.08.2023, which is arising out of the order under section 147 of the Act on 10.09.2021 framed by Income Tax Officer, National Faceless Assessment Centre, Delhi.
2. At the time of hearing, it was notice that the appeal is barred by limitation by 11 days and accordingly ld. Counsel for the assessee was asked to explain the delay. Ld. Counsel submitted that due to certain reasons beyond the control of the assessee, this appeal could not be filed within due time. The ld. A.R. stated that the Memorandum of Appeal was sent for assessee's signature however, the assessee being not well, therefore, this minor delay has occurred. The ld. D.R. left the issue of condonation of delay to the wisdom of the Bench.
3. After hearing both the sides and taking into consideration of the reasons for delay, I observe that the delay is for a reasonable cause and accordingly the same is condoned.
4. The assessee has challenged reopening of assessment by the ld. Assessing Officer under section 147 of the Act, which was upheld by the ld. CIT(Appeals).
5. The facts in brief are that the assessee filed his return of income on 31.03.2014 declaring total income of Rs. 1,90,560/-. Thereafter the case of the assessee was reopened under section 147 of the Act by issuance of notice under section 148 on 19.03.2020 after obtaining approval from the competent authority. The said reopening was done on the basis of information received from the Investigation Wing that the assessee has earned long-term capital gain of Rs. 8,30,000/- from transfer of shares of Quest Financial Service Limited, which is a penny stock company and the said gain has been claimed as exempt under section 10(38) of the Income Tax Act. Thereafter notice was issued and served upon the assessee and after calling for the necessary details qua the said purchase and sale of shares of Quest Financial Service Limited, an addition of Rs. 7,78,816/- was made under section 68 of the Act, beside making addition of Rs. 46,730/- @ 6% towards commission for arranging accommodation entry of long-term capital gain in the assessment framed under section 147 dated 10.09.2021. The ld. CIT(Appeals) affirmed the addition by upholding the order of the ld. Assessing Officer and held that it was penny stock, which was rightly added by the ld. Assessing Officer.
6. After hearing the rival contentions and perusing the material available on record, I observe from the reasons recorded under section 148(2) of the Act, a copy of which is placed at page no. 2 of the assessment order, that the reasons were recorded without application of mind and in a very casual and mechanical manner. The said reasons are extracted below for the sake of ready reference:
The assessee is regularly assessed in Ward 50(4), Kolkata. The assessee filed its return of income on 31.03.2014 declaring gross total income of Rs. 3,00,564/- for the A.Y.- 2013-14 which was processed u/s 143(1)of the IT Act on 22.08.2014.
Information has been received from DIT(Inv), Kolkata, dated 07.01.2015, the assessee has taken entry of bogus LTCG for an amount of Rs. 8,30,000/- during the F:Y: 2012-13. The assessee has earned profit of penny stock amounting to Rs. 8,30,000/- and the assessee involvement in prearranged bogus LTCG/STCG in the scrip of penny stock "M/s Ques........