DCIT Vs Nisha Shantaram Pokle (ITAT Mumbai)
The Income Tax Appellate Tribunal (ITAT), Mumbai, dismissed the Revenue’s appeal and upheld the order of the Commissioner of Income Tax (Appeals) [CIT(A)] deleting additions made under Section 68 of the Income-tax Act, 1961, in relation to Long-Term Capital Gain (LTCG) claimed by the assessee on the sale of shares of Marigold Glass Industries Ltd., subsequently known as Greencrest Financial Services Ltd. The Revenue had challenged the deletion of an addition of ₹5.96 crore treated as unexplained cash credit and a consequential addition of ₹35.77 lakh alleged to be commission expenditure.
The assessee had purchased 2,00,000 shares of Marigold Glass Industries Ltd. through a preferential allotment for ₹24 lakh paid through banking channels. The shares were subsequently dematerialized and, following a share split, increased to 20 lakh shares. These shares were sold through the Bombay Stock Exchange (BSE) between June 2014 and December 2014, resulting in sale proceeds of ₹5.96 crore and an LTCG claim exempt under Section 10(38). To substantiate the claim, the assessee furnished extensive documentary evidence, including allotment letters, share certificates, bank statements, demat account statements, broker records, contract notes, and evidence of receipt of sale proceeds through banking channels. Securities Transaction Tax (STT) had also been paid on the sale transactions.
