DCIT Vs Chunibhai Haribhai Gajera (ITAT Surat)
ITAT Surat held that addition on account of bogus Long Term Capital Gain under section 68 of the Income Tax Act is not sustainable since the impugned scrip i.e. Kyra Landscapes Ltd. is not in the list of shares in the investigation report in case of project bogus LTCG/STCL. Accordingly, appeal of department dismissed.
Facts- The case of the assessee was reopened on the basis of the information that assessee has made wrong claim of exempt long-term capital gain u/s. 10(38) of the Income Tax Act on sale of shares of penny scrips M/s. Kyra Landscapes Ltd.
AO issued notice wherein assessee was requested to show cause why share sale transactions in penny scrip may not be treated as sham transaction. AO did not accept the contentions of the assessee and added Rs.9,44,74,391/- as unaccounted credits u/s.68 of the Act and Rs.64,78,080/- on account of unexplained commission expenditure u/s.69C of the Act.
CIT(A) deleted the entire addition made by AO. Being aggrieved, revenue has preferred the present appeal.
Conclusion- We have also found that the share of Kyra Landscapes Ltd. (formerly known as TCL Technologies Ltd.) was not in the list of 84 shares in the investigation report in the case of Project Bogus LTCG/STCL through BSE Listed penny stocks.
