S. 68 : Cash credits- Sale of shares-Penny stock-Denial of exemption is not justified-Addition as cash credits is deleted-Estimated commission- Addition is deleted. [S. 10(38), 45, 69C]
The assessee purchased 2 lakh shares of M/s Paridhi Properties Ltd (PPL) at cost of Rs.10 per share which is amounting to Rs.20 lakhs., in March 2014. Later on, M/s Paridhi Properties Ltd merged with Luminaire Technologies Ltd which allotted 20 lakhs equity shares at face value of Rs.1/-. Out of the 20,00,000 shares, 47,2000 shares were sold during March 2013, within a gap of 10-12 days amounting to Rs. 2,50,24,074/-. Considering the period for holding the assessee’s claimed long term capital gain exemption U/s 10(38) of the Act. Documents like bank transaction, share transaction copy, paid through STT, ledger and demat account were duly submitted before the revenue authorities. Based on the report of the investigation wing the Assessing Officer reopened the assessment and the sale consideration is assessed as cash credits and also addition is made under section 69C as alleged payment of the Commission. On appeal the CIT( A) affirmed the order of the Assessing Officer . On appeal the Tribunal allowed the claim of the assessee under section 10(38 ) of the Act. Judgement of PCIT v. Swati Bajaj (2022) 139 taxmann.com 352 /288 Taxman 403 / 446 ITR 56 (Cal)(HC) distinguished . Orders of Jurisdictional High Court in CIT v. Shyam R Pawar [2015] 54 taxmann.com 108/229 Taxman 256 (Bom) (HC) CIT v Jamnadevi Agrawal [2010] 328 ITR 656 (Bom)(HC) , CIT v Mukesh Ratilal Marolia (Bom) (HC) (ITA No 456 of 2007 dated 07/09/2021 ), PCIT v. Ziauddin A. Siddiquie (ITA No. 2012 of 2017 Date 04/03/2012 (BOM) (HC) (ITA 4271/Mum/2023 dt. 30 -5 -2024)( AY. 2013 -14
Shaily Prince Goyal v. ITO (Mum.)(Trib.) www.itatonline.org
(Source : Hon’ble Shri B.R. Baskaran, AM and Hon’ble Shri Anikesh Banerjee, JM)