Gaurav Pincha Vs ITO (ITAT Kolkata)
In a case concerning Assessment Year 2014–15, the Income Tax Appellate Tribunal (ITAT), Kolkata, allowed two appeals filed by Gaurav Pincha against the order dated 19/01/2018 by the Commissioner of Income Tax (Appeals). The primary issue was the treatment of Long-Term Capital Gains (LTCG) claimed by the assessee from the sale of shares in M/s. NCL Research & Financial Services Ltd. The Assessing Officer had treated the gains as bogus, rejecting the assessee’s claim for exemption under Section 10(38) of the Income Tax Act. The AO relied on general reports and patterns of suspected misuse of LTCG exemptions, applying conclusions based on suspicion and general modus operandi without specific evidence against the assessee.
The appellate authority had upheld the AO’s findings based on circumstantial factors and the concept of human probabilities. However, the ITAT noted that the evidence submitted by the assessee in support of the genuineness of the share transactions remained unchallenged. No direct or specific material had been presented to dispute the transactions. Furthermore, the assessee had not been confronted with the investigative report that formed the basis for the addition, and a copy of the report had not been shared. The ITAT referred to multiple prior decisions, both from itself and from High Courts, which emphasized the need for concrete evidence rather than assumptions. Relying on these precedents, the Tribunal ruled in favor of the assessee and deleted the addition, allowing both appeals.
