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the assessee submitted sufficient documentary evidences before A.O. to prove genuineness of the transaction. The assessee purchased the shares through banking channel and actually got the shares transferred in his name. The purchases are supported by bank statements. The transaction of the sale have been made through Demat Account which is corroborated by contract note and other details and transaction is carried out through banking channel through stock exchange through Demat Account on which Security Transaction Tax have also been paid. The A.O. merely relied upon interim order of the SEBI to make addition against the assessee, otherwise, there were no evidence or material on record to disprove the claim of assessee. Since the interim order of the SEBI have been revoked against the assessee and M/s EBFL, therefore, nothing survives in favour of the A.O. The A.O. did not make any further investigation or enquiry into the matter and merely relied upon the interim order of the SEBI and investigation carried out by the Kolkata Wing. Further, it is not clear from the assessment order whether Investigation Wing report have been confronted to the assessee or any right of cross-examination have been allowed to any statement recorded at the back of the assessee. The assessee asked for the cross-examination of any statement which is used against the assessee for making the addition. But, the assessment order is silent on this aspect. Therefore, the above facts clearly show that assessee entered into the genuine transaction and as such the profit on sale of scrip was exempt from tax. The Ld. D.R. relied upon decisions of the ITAT, Delhi Benches, Delhi in the cases of Suman Poddar vs., ITO (supra) and Udit Kalra vs., ITO (supra), in which the findings of the Tribunal had been that these are cases of penny stock companies which fact is not there in the presentcase. Therefore, these decisions would not support thecaseof the Revenue as having distinguishable on facts. The authorities below have not rebutted the explanation of assessee that he has indulged in dealing in scrips in earlier year as well as in subsequent years. It would, therefore, show that assessee is regularly dealing in scrips. The A.O. has not brought any adverse material against the assessee so as to make the above additions. Considering the totality of the facts and circumstances of thecaseand financials of M/s EBFL as reproduced above and other years [PB-76], we set aside the Orders of the authorities below and delete both the additions.

Shanti Prime Publication Pvt. Ltd.

Sec. 68 of Income Tax Act, 1961—Cash Credit ---  assessee was an individual filed return of income. The case was selected for scrutiny on the reasons “suspicious transaction relating to long term capital gain on shares”. The assessee was a Director of a Company  from where he has drawn gross salary during the year. The assessee has income from other sources also i.e., income from house property , income from other sources. There was no income from business and profession and income from capital gains. The assessee in the reply before the A.O. claimed long term capital gains on sale of shares. The show cause notice was issued to the assessee as to why the same be not treated as unexplained income under section 68 of the I.T. Act, 1961 and commission on sale of share had also not added. The A.O. further made addition on account of commission paid for sale of shares. The assessee challenged both the additions before the CIT(A). Therefore, the above facts clearly show that assessee entered into the genuine transaction and as such the profit on sale of scrip was exempt from tax. The authorities below have not rebutted the explanation of assessee that he has indulged in dealing in scrips in earlier year as well as in subsequent years. It would, therefore, show that assessee is regularly dealing in scrips. The A.O. has not brought any adverse material against the assessee so as to make the above additions. Considering the totality of the facts and circumstances of the case tribunal set aside the Orders of the authorities below and delete both the additions. The appeal of the Assessee was allowed. --- SHRI RIAZ MUNSHI vs. Asstt. CIT. [2020] 23 ITCD Online 53 (DELHI)

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