Capital gain from penny stocks not bogus for violation of SEBI regulations by broker

In the case of Arun Kumar Agarwal (HUF) (supra), the Hon’ble Jharkhand High Court has held that where assessee’s broker share transaction was bone fide in all respect, merely because share broker was tainted violating SEBI regulations, would not make assessee’s share transactions bogus. The ratio of the above decisions is applicable to the instant case. Full Text of the ITAT Order is as follows:- This is an appeal filed by the Revenue. The relevant assessment year is 2005-06. The appeal is directed against the order of the Commissioner of Income Tax (Appeals)-34, Mumbai and arises out o...