Shilpa Khandelwal Vs DCIT (ITAT Lucknow)
ITAT Lucknow allows exemption on LTCG from Share Sale: Discards AO’s reliance on unfurnished Investigation Report; Documented share transactions cannot be disregarded merely on suspicion- ITAT slams AO for blindly relying on Investigation Report
Assessee filed return declaring income of ₹10.76 lakh & claimed exemption of ₹31.87 lakh as Long-Term Capital Gain (LTCG) u/s 10(38) from sale of shares of Gold Line International Finvest Ltd. (₹24.09 lakh) &
Kappac Pharma Ltd. (₹7.77 lakh). The case was selected for scrutiny due to “suspicious share transactions.” AO held that the transactions entered into by assessee were sham in nature & that the assessee was trying to introduce unaccounted money in the guise of exempted Long Term Capital Gain. AO added the amount u/s 68 as unexplained cash credit.
Tribunal noted that AO & CIT(A) have not considered the evidences filed by Assessee in the right perspective & have proceeded to deny the claim of exemption entirely on the basis of one investigation report of the Dept, which was never even shown to Assessee nor was she ever allowed any opportunity to refute the same. Tribunal noted that Hon’ble High Court of Delhi in the case of PCIT vs. Smt. Krishna Devi has downplayed the principle of preponderance of probability & has held that evidence produced by Assessee overpowers the principle of preponderance of probability.
