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2022 (11) TMI 724 - ITAT AHMEDABADRevision u/s 263 by CIT - Bogus LTCG - Penny stock purchases - HELD THAT:- In the present case, in fact the margin of gain varies from shares – bought at the rate of Rs.50/- being sold at Rs.100/- almost hundred percent margin throughout the year with numerous transactions being taking place; that even in the last sale of VIL shares at very high rate of Rs.125/- per share is demonstrated to be genuine by the fact that the assessee subsequently purchased these shares at this very high rate and held on to them. If the assessee was indulging in taking accommodation entry, he would not have subsequently purchased these shares at a very high rate, because, that would have defeated the purpose of introducing his own unaccounted money into his own books of accounts. Based on the evidence that were furnished before the AO, we find that the AO had taken a plausible view that the impugned transaction was not a penny stock trading, but in fact was a genuine trading transactions of VIL shares and accordingly allowed the claim of short term capital gain returned by the assessee. CIT has not controverted any of the facts which the assessee has demonstrated before the AO in support of its claim of genuineness of the transactions. In fact, he does not even point out what exact information was there with the AO which he should have used against the assessee. He merely makes general reference to the investigation report of the Department stating to have contained information regarding these shares. With the assessee having sufficiently demonstrated genuineness of the transaction of trading in shares of VIL and also that it was not a mere penny stock traded in, and the ld.Pr.CIT having not pointed out insufficiency in the explanation and the evidence filed by the assessee, and also not specificying what information was there with the AO against the assessee, there could be no finding of error at all in the order of the AO accepting the assessee’s claim of the transactions being genuine. The order passed by the Pr.CIT therefore, we hold, is without any basis and is therefore set aside. The grounds of appeal of the assessee are allowed.
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