Asha Himmat Bhadra Vs DCIT (ITAT Mumbai)
In a significant ruling, the Income Tax Appellate Tribunal (ITAT) Mumbai has set aside additions made under sections 68 and 69C of the Income Tax Act against taxpayer Asha Himmat Bhadra. The case revolved around the sale of shares in M/s. Splash Media (now Luharuka Media & Infra Ltd.), which the Income Tax Department had deemed a “penny stock,” leading to substantial additions to the assessee’s income for the Assessment Year 2011-12.
The assessee, Asha Himmat Bhadra, had purchased 2,500 shares of Splash Media on August 19, 2009, for Rs. 3,27,496/- through Alliance Finstock Ltd., a SEBI-registered broker, via the BSE’s electronic trading platform. Payment was made through an account payee cheque on August 18, 2009, and the shares were delivered to her demat account on December 8, 2009. Subsequently, the company declared a 3:1 bonus issue on December 23, 2009, increasing her holding to 10,000 shares. A stock split in the ratio of 10:1 on August 2, 2010, further boosted her holding to 100,000 shares of Rs. 1 each. These shares were then sold on the Bombay Stock Exchange through the same broker for a total consideration of Rs. 1,00,13,050/- between December 2010 and January 2011. The assessee provided documentary evidence including purchase bills, bank statements showing payment, demat account statements, and sale bills/contract notes.
