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2018 (11) TMI 1625 - AT - Income TaxBogus LTCG - denial of exemption claimed by it u/s.10(38) - penny stock purchases - addition as cash credit u/s 68 - opportunity to cross examine the witness - HELD THAT:- Though it is stated in the assessment order that assessee was apprised about the Investigation done in Kolkata, it is not clear whether the reports of such investigation and statements recorded from various persons relied on by the Revenue for disbelieving the claim of the sale of shares, were put to the assessee. Undisputedly, the sale of shares were through recognized stock exchange and through a recognized stock broker. Question regarding genuineness of the claim of long term capital gains requires to be restored to the ld. Assessing Officer for reconsideration after granting assessee adequate opportunity to substantiate its case. Revenue has to furnish to the assessee all the statements relied on by them. Hon’ble Apex Court in the case of CIT vs. Sunita Dhadda, [2018 (3) TMI 1610 - SC ORDER] , has affirmed a judgment of Hon’ble Rajasthan High Court in the case of CIT vs.Smt. Sunita Dhadda [2017 (7) TMI 1164 - RAJASTHAN HIGH COURT] , where the importance of providing an opportunity to cross examine the witness has been stressed. Their lordship held that this was an important constituent of natural justice. Only after all the steps required under law is complete, it can be ascertained whether claim of capital gains was bogus or not. We therefore set aside the orders of the lower authorities and remit the issue back to the file of the AO for consideration afresh in accordance with law. - Appeal of the assessee is allowed for statistical purpose.
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