2011 (9) TMI 919 - HC - Income Tax

Unexplained investment under section 69 - sale of the shares - penny stocks - ITAT deleted the addition - Held that:- The Assessee has produced certificates from the aforesaid four companies to the effect that the shares were infact transferred to the name of the Assessee. In these circumstances, the decision of the ITAT in holding that the Assessee had purchased shares out of the funds duly disclosed by the Assessee cannot be faulted.

It is neither the case of the Revenue that the shares in question are still lying with the Assessee nor it is the case of the Revenue that the amounts received by the Assessee on sale of the shares is more than what is declared by the Assessee. Though there is some discrepancy in the statement of the Director of M/s. Richmand Securities Pvt. Ltd. regarding the sale transaction, the Tribunal relying on the statement of the employee of M/s. Richmand Securities Pvt. Ltd. held that the sale transaction was genuine. ITAT is correct in holding that the purchase and sale of shares are genuine and therefore, the Assessing Officer was not justified in holding that the amount as unexplained investment under Section 69 cannot be faulted. - Decided in favour of assessee.