Madhu Sarda Vs ITO (ITAT Mumbai)
The learned AR of the assessee submits that during the year under consideration assessee sold 900 shares of National Tiles & Industries Private Ltd (NTPL) at the rate of Rs. 100/-per share on their fair market value. These shares were held by the assessee for last 15 years. The assessee purchased the share in the year 1991 from NEC Investment Company. During the relevant financial year the assessee also sold a property situated in Santacruz Mumbai. After claiming indexation benefit the assessee offered long term capital gain of Rs. 25 Lacs (approx) on sale of such property. It was submitted that assessee also sold 900 shares of National Tiles & Industries Private Ltd to her son. Her son had returned from abroad after completing his education and was interested in starting his own business. The aforesaid 900 share was sold at the fair market value. The shares were transferred by executing share transfer Form and after paying the requisite Stamp duty, the company NTPL also passed a Board Resolution for transfer of those shares. The consideration of share was effected to through banking channel. The learned AR of the assessee drawn our attention about the fair market value arrived by assessee, as furnished before Commissioner (Appeals), (page No. 74 of PB). It was submitted that transactions is genuine, merely because the assessee has claimed setoff of capital loss against the capital gain earned during the same period, which cannot be said to be a colourable device or method adopted by assessee to avoid the tax. Transactions of sale of share were genuine and transacted at a proper valuation. The lower authority has not disputed the genuinity of transaction. All the transactions carried by assessee are valid in law, and cannot be treated as non-est merely on the basis of some economic detriment or it may be prejudicial to the interest of revenue. The learned AR of the assessee further submits, mainly because the period co-existed or permitted the assessee to set off her capital loss against the capital gain earned itself would not give rise to the presumption that the transaction was in the nature of colourable device.
