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2015 (5) TMI 890 - AT - Income TaxExemption u/s. 10(38) of long term capital gain - genuineness of transaction in shares - CIT(A) allowed the claim - Held that:- Issue raised by the AO in the order of assessment has already been decided in the case of Bhoruka Engineering Industries Ltd. (2013 (7) TMI 543 - KARNATAKA HIGH COURT). The Hon’ble ITAT in the case of Bhoruka Engineering Industries Ltd. [2013 (7) TMI 646 - ITAT BANGALORE] had upheld the order of the AO holding that the sale of shares by the various entities of Bhoruka group was a colorable device to evade tax and the capital gain on sale of shares was to be regarded as short term capital gain and exemption u/s.10(38) of the Act was not to be allowed. The assessee had carried the matter to the Hon’ble High Court of Karnataka. The Hon’ble High Court of Karnataka was pleased to set aside the order of the Tribunal and held that the transaction of sale of shares were real, genuine and for valuable consideration and were within the framework of law. Consequently, exemption u/s. 10(38) of the Act had to be allowed. It is not in dispute that the facts in the case of assessee are identical with that of the case of Bhoruka Engineering Industries Ltd., (supra) and therefore the decision of the Hon’ble High Court of Karnataka will squarely apply to the facts of the present case. We are therefore of the view that the order of the CIT(Appeals) has to be upheld and the claim of the assessee for exemption u/s. 10(38) of the Act has to be allowed. - Decided in favour of assesse.
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