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2022 (6) TMI 565 - AT - Income TaxAddition u/s 68 - unexplained cash credit - Unexplained LTCG on share transactions - HELD THAT:- As at the time of sale of shares, the price has increased astronomically by almost 1945%. Further, he found that as per investigation conducted by Investigation Wing of the department at various places, it was found that this company is a penny stock company. Thus, based on such information available on record, he called upon the assessee to explain, why the long term capital gain offered should not be treated as unexplained cash credit under section 68 - Though, the assessee offered some explanation to claim that the share transaction was genuine, however, the AO was unconvinced. Ultimately, he proceeded to complete the assessment by treating the long term capital gain as unexplained cash credit under section 68 of the Act. Further, he added back an amount as commission paid to avail the bogus long term capital gain. The additions so made by the AO were also confirmed by learned Commissioner (Appeals). On a careful reading of the orders passed by the departmental authorities, it is observed, as per the investigation conducted in relation to the shares of the company, on which, the assessee offered long term capital gain, it was found that it is a penny stock company. It was also found that due to price manipulation and rigging, there was astronomical increase in the price of the shares. As it appears from the facts on record, the assessee has not furnished any strong evidence before the departmental authorities to rebut the adverse materials brought on record by the department. Even before me, the factual position remains unaltered as the assessee neither appeared nor placed contrary materials for enabling me to disturb the finding of the departmental authorities. - Decided against assessee.
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