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2021 (7) TMI 493 - AT - Income TaxBogus LTCG - Disallowing exemption u/s 10(38) - penny stock - Addition of Long Term Capital Gain on the listed equity shares treating it as income from undisclosed sources - HELD THAT:- In the instant case the entire transaction was carried out through the Demat account and banking channel upon which STT has been paid by the assessee before us. In order to hold the transaction is bogus and / or ingenuine, the Assessing Officer is required to bring in cogent/clinching evidence to prove the same. It is pertinent to mention that no observation is forthcoming from the orders passed by the revenue pointing out any material defect in the procedure followed by the assessee in such purchase and sale of the shares in question. Neither any cogent/corroborative evidence is brought on record by the revenue to hold otherwise and therefore, there is no doubt that the Assessing Officer has merely proceeded to arrive at his conclusion that the transaction. As taking into consideration the entire aspect of the matter in the absence of any independent enquiry made by the Ld. A.O as already observed by us respectfully relying upon the judgment passed by Hon’ble Delhi Bench in the case of Swati Luthra [2019 (7) TMI 526 - ITAT DELHI] on the identical facts keeping in view of the orders passed by SEBI, we do not hesitate to observe that holding the said M/s Turbo Tech Engineering Ltd as a penny stock company by the authorities below without any corroborative evidence is uncalled for and unjustified. Such action is erroneous arbitrary whimsical and suffers from the principle of surmise and conjecture. Thus, the disallowance of the claim made by the assessee towards the Long Term Capital Gainbeing bogus based only on mere surmise and conjecture.Thus, the disallowance of the claim made by the assessee towards the Long Term Capital Gain is bad in law and liable to be quashed. Consequentially the addition of 3% of brokerage is also of no basis - Decided in favour of assessee.
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