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2012 (11) TMI 1218 - AT - Income TaxShort term capital loss disallowed - Held that:- Such share transactions were not quoted and consequently, were not traded through stock exchange. When all the facts and circumstances of the case are viewed, in totality, it is evident that the assessee appellants failed to discharge the onus, to prove the genuineness of the transactions of purchase and sales of such shares. The impugned transactions of shares are preordained one, not for legitimate commercial purpose in view but for the purpose of creating non-genuine and artificial short term capital loss, with a view to reducing valid taxliability. These transactions of shares were not governed by market factors prevalent at that relevant time, in such trade, but the same are product of the design and mutual understanding on the part of the appellants and the said Hissar based unlisted company. CIT(Appeals) has failed to bring any cogent and credible evidence, to dislodge such finding. Having regard to the peculiar fact-situation of the present case, it is evident that such share transactions were close circuit transactions and clearly structured one. No merit in the findings of the CIT(Appeals). Having regard all the findings of the CIT(Appeals) cannot be sustained and, hence, the same are reversed. Further, an offer to surrender the impugned loss, subject to no penal action, made by the appellants before the AO, in the course of assessment proceedings, is an important piece of evidence, hence, cannot be ignored lightly. Consequently, the findings of the AO, as recorded in the impugned assessment order, are restored.
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