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2023 (5) TMI 462 - ITAT MUMBAIBogus sale proceeds as undisclosed income - addition u/s 68 - short term capital loss claimed by the assessee - penny stock transactions - informations received from investigation wing and AO proceeded to disallow the loss claimed by the assessee as well as proceeded to make the sale proceeds as undisclosed income - HELD THAT:- We observe that during the current Assessment Year assessee has purchased the scrip of M/s. VAS Infrastructure Limited and subsequently sold the same within the same year from the recognized stock exchange and also through authorised agent - all these transactions were through banking channels only and in that process assessee has suffered loss. AO mechanically applied the informations received from investigation wing and proceeded to disallow the loss claimed by the assessee as well as proceeded to make the sale proceeds as undisclosed income. As decided in Rajiv Rameshchander [2023 (1) TMI 1249 - ITAT MUMBAI] AO/Ld. CIT(A) has not appreciated the facts in the right perspective and has disallowed the business loss of the assessee while trading in this scrip. It is found that Assessee is a trader in shares - as shares traded are his stock-in-trade. And once assessee is found to be a trader, the loss incurred during business need to be allowed as business loss. Thus we are inclined to delete the addition made by the AO u/s. 68 of the Act and direct the AO to allow the short term capital loss claimed by the assessee incurred during the year. Decided in favour of assessee.
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