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2021 (4) TMI 148 - AT - Income TaxBogus LTCG - script being a penny stock and paper entity - HELD THAT:- Assessee had purchased shares through SEBI registered brokers through screen based trading and for which the payments were made through banking channels. The assessee had sold shares through authorized stock brokers through screen based trading and payments were received through banking channels after deduction of STT. shares of CCL International Ltd. were in the demat account of asses see and the fact of these shares having been transferred to the account of brokers M/s. Chuknoo Securities Ltd. on account of sale is also apparent from this paper. The transaction statement placed in paper book also proves that the assessee was holding other scripts also. Paper book demonstrates that proceeds of sale of such shares were credited to bank account of the assessee. All evidence of purchase sale are placed. All these documents clearly demonstrate that the assessee did earn long-term capital gain on the sale of shares of CCL International Ltd. after holding for a period of more than one year and on which STT was also paid. Moreover the Assessing Officer has not doubted any of the above documents. The only objection raised by the authorities below is that the scrip from which the assessee had earned long-term capital gain has been held by the Investigation Wing of the Revenue to be a paper entity and which has further held that this scrip was being used for creating artificial capital gain. We find that the hon'ble Tribunal in the case of Mohan Lal Agarwal (HUF) [2018 (11) TMI 1489 - ITAT DELHI] has examined this aspect and after recording detailed findings has held this scrip to be a genuine scrip and has held that the scrip is not a paper entity. Also see SHRI ACHAL GUPTA, SHRI UDIT GUPTA, SHRI RAKESH NARAIN GUPTA VERSUS INCOME TAX OFFICER-3 (1) , KANPUR. [2021 (1) TMI 896 - ITAT LUCKNOW] Therefore, following the above judicial precedents, we allow the appeals of the assessee on the merits.
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