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2022 (9) TMI 843 - AT - Income TaxBogus purchases - penny stock purchases - HELD THAT:- Mere payment by account payee cheque is not sacrosanct and it will not make otherwise non-genuine transaction genuine as held by the Hon’ble Calcutta High Court in the case of CIT Vs. Precision Finance Pvt. Ltd. [1993 (6) TMI 17 - CALCUTTA HIGH COURT] We hold that the action of the assessee is nothing but pre-motivated and deliberate conduct done for converting the unaccounted money of the assessee under the guise of long term share transaction and that too without paying requisite tax on the same. This clearly amounts to tax evasion. In the present case also, it was beyond preponderance of probabilities that the fantastic sale price of a little known shares i.e. Mahavir Advanced Remedies Ltd., without any economic or financial basis to increase from Rs. 5/- to Rs. 282/- per share. The above increase is 56 times which is evident from the fact that by investing Rs. 2,35,000/- ( out of 50,000 shares 47,000 shares were sold) the assessee has got Rs. 1,32,48,345/- in a span of 28 months. There is no doubt that the capital gain was manipulated and bogus and was done to claim exemption u/s 10(38) of the Act. We therefore, do not find any reason to interfere with the findings of the ld. CIT(A) and the same is upheld. - Decided against assessee.
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