The assessee was a SEBI-registered portfolio investor and a tax resident of Mauritius. It held shares of an Indian company M/s International Conveyors Limited (ICL) for more than 10 years before selling them. The AO treated the transaction as a non-genuine transaction and taxed the gains of Rs. 6,64,96,351/- u/s 68 of the Act.

On perusal of the financials of (ICL), it was found that it was engaged in the business of manufacture and marketing of PVC fire resistant antistatic conveyor belting since 1978 having its factory at two locations with around 78 employees and the reserves and surplus being approximately 152 crores. The ITAT also found that the price movement from Rs. 11.90 per share to Rs. 29.66 per share over a period of ten years was not unreasonable and unrealistic. The company did not have dummy directors. Since the assessee had furnished all details of the transaction and had held the shares of more than 10 years, the addition was deleted by the ITAT.