On the basis of  the information received from the Investigation Wing that the assessee made transaction with penny stock scrip  VAS Insfratcture Ltd (VASIL)   to launder money to grab long-term capital gain and claimed exemption under section 10(38). Scrip of the VAS were manipulated by the assessee to generate bogus losss. Additions were made to income of assessee on account of bogus loss incurred in penny stock. The Tribunal deleted the  additions. On appeal to the High Court, the Rrevenue submitted the order of the Tribunal was ex-facie erroneous, illegal and perverse because Tribunal deleted the additions on account of disallowance of bogus loss in penny stock incurred, without appreciating that the transaction was pre-arranged as well as sham and was carried out through penny scrip company/paper Company. High Court held that thee Tribunal  held that  thee assessee was continuously dealing in share trading of various shares/scrips and said fact was not disputed.  Further the Tribunal had observed that scrip of VAS was not black listed by SEBI at relevant point of time. Tribunal had also considered order passed by SEBI and nowhere in said order, scrip of VAS was blacklisted or was penny stock or sham and bogus scrips/shares.  Tribunal had also observed that entire transaction of purchase and sale of scrips was through Stock Exchanges, through authorized brokers and payments made to brokers were reflected in bank account.  Tribunal had therefore opined that merely on conjecture and surmises, Assessing Officer could not make disallowance. Court affirmed the order of the Tribunal.  (AY. 2012-13)