Case Law Details
Ms. Anupama Garg Vs ITO (ITAT Delhi)
Conclusion:
Where assessee had furnished relevant evidences such as copies of bank statement, demat account, share purchase documents and share certificate., etc., to prove its bogus long-term capital gain on sale of shares and no adverse material had been brought on record by AO to disprove the claim of assessee, addition made under section 68 on account of unexplained credit could not be sustained.
Held:
Assessee claimed exemption under section 10(38) in respect of long-term capital gain on sale of shares. A.O. observed the modus operandi of LTCG accommodation entry in the assessment order and also referred to recommendation of Special Investigation Team and held that huge capital gains were earned by assessee within a short period of time by investing in penny stock whose fundamental/financials had no support, was neither the result of co-incidence nor of a genuine investment activities but were created through well planned and an executed scheme in which Company brokers and buyers and sellers of the scrip worked deliberately to achieve the pre-determined objectives. Therefore, addition made on account of unexplained credit. It was held assessee sold shares on BSE and payment was received from share broker. Assessee submitted copies of bank account, Demat account, share purchase documents and share certificate and also copy of evidence for payment of securities transaction tax before the authorities. The documentary evidences submitted by assessee had not been rebutted by the A.O. No adverse material had been brought on record to disprove the claim of assessee. Therefore, addition made under section 68 could not be sustained.
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