ACIT Vs Nandkumar Khatumal Harchandani (ITAT Nagpur)
ITAT Nagpur held that addition under section 68 towards bogus LTCG set aside as sale transaction of shares cannot be doubted. Thus, sale consideration received on sale of shares cannot be assessed as unexplained cash credit under section 68 of the Income Tax Act. Thus, appeal of revenue dismissed.
Facts- Revenue has preferred the present appeal mainly contesting that CIT(A) has erred in deleting the addition of Rs. 5,60,75,185/- made by AO U/s. 68 of the Income Tax Act, 1961 on account of long term capital gain claimed as exempt income u/s. 10(38) without appreciating that it was a bogus accommodation entry.
Conclusion- The Assessing Officer has not established that the assessee was involved in bogus long term capital gains and to avoid paying the taxes as well and the Assessing Officer could not find fault with any of the documents furnished by the assessee, Revenue fails on this issue.
Held that the sale transaction or shares cannot be doubted with, the addition made by Assessing Officer with regard to the provisions of section 68 was rightly deleted by the CIT(A). The sale consideration received on sale of shares cannot be assessed as unexplained cash credit under section 68 of the Act and the long term capital gains declared by the assessee cannot be doubted with. The impugned order passed by the learned CIT(A) is upheld on this issue by dismissing the grounds raised by the Revenue.
