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2020 (2) TMI 975 - AT - Income TaxGenuineness of loss from trading of shares - Set off of loss incurred in the business of purchase and sale of shares - penny stocks - AO made disallowance doubting the genuineness of the transactions of purchase and sale of shares - HELD THAT:- From the perusal of the order of the lower authorities there is nothing on record to say that report of the Director of Investigation Wing, Kolkata was made available to the assessee. Furthermore, the Assessing Officer had not established collusion of the assessee in the alleged fraud. M/s. Kodak Securities Ltd is not one of those banned entities by SEBI. The time gap involved between purchase and sale of shares is more than one year and shares were demated. In the circumstances, the transactions cannot be held as ‘’not genuine’’ merely based on suspicion. Suspicion however, be strong cannot take the place of proof. It is settled position of law that no addition can be made on mere suspicion. Therefore, we are of the considered opinion that disallowance of claim for set off of loss in trading of the transactions cannot be upheld. Hence, we reverse the order of the lower authorities and allow the appeal of the assessee.
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