Cash purchase of share is not prohibited by Law

Swati Luthra Vs ITO (ITAT Delhi) Conclusion:  Assessee had entered into genuine transaction of sale and purchase of shares and therefore, satisfied the conditions of Section 10(38) as no law prohibits purchase of shares in cash and it was the option of the buyer of shares to keep the shares either in Demat form or in paper form therefore, merely because the shares were dematted at a later stage, no adverse inference could be drawn. Held: AO observed that share prices of two scrips sky rocketed without having any financial strength and the increase was due to artificial increase. He also obser...