2019 (6) TMI 297 - ITAT KOLKATA

Bogus LTCG - Addition u/s. 69 - benami transactions - sale proceeds of equity shares - AO observed that assessee was not involved in activities of transactions in other shares and the assessee has not earned any LTCG from the sale of other shares - HELD THAT:- The assessee has purchased the shares from the off market and was in the physical form and later on it was dematerialised. The shares were credited into the assessee’s demat account on 20.06.2013. Later on the shares were listed in the BSE and the assessee had sold the shares through M/s. J.M. Financial Services, Mumbai. Copy of Contract Note of sale is placed and copy of demat statement is available from which statement we note that it reflects debit entry for the shares from the account.

The sale considerations have happened through the banking channel (Vijaya Bank). AO has reproduced certain portions of the general report of Investigation Wing of the Income Tax Department. Nowhere from the general report of Investigation Wing is it seen that the assessee has indulged in any nefarious activities or her broker has carried out any stage managed/pre determined sale of the shares as contended by the AO. SEBI’s report also does not in any way point out any wrong action against the assessee’s broker or the scrips. We note that there is no specific evidence which have been collected by the AO in coming to a conclusion that the sale consideration from the sale of shares of M/s. GIFL is bogus.

Lower authorities erred in holding the assessee’s claim on LTCG from the sale of shares of M/s. GIFL as bogus. Therefore, we are inclined to allow the assessee’s LTCG claim and, therefore, the appeal of assessee is allowed.