Documentary proof of share transactions defeats sham capital gains addition when revenue cannot rebut concurrent factual findings.

Documentary evidence such as demat records, dividend receipts, banking-channel payments and sales through a SEBI-registered broker supported the assessee's share transactions and claim of long-term capital gains. The appellate authorities' concurrent view that the Assessing Officer had failed to dislodge these facts in remand proceedings was treated as a finding of fact, and the High Court noted that the addition rested largely on suspicion. As no material showed the findings to be illegal, erroneous or perverse, and no substantial question of law arose, interference was declined and the addition was held unsustainable.

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Issues: Whether the addition made by the Assessing Officer on account of alleged sham share transactions and long-term capital gains was rightly deleted.

Analysis: The assessee supported the share purchase and sale with documentary evidence, including dematerialisation records, dividend receipt, payment through banking channels, and sale through a SEBI-registered broker. The appellate authorities found that the Assessing Officer could not contradict these facts in the remand proceedings and proceeded largely on suspicion. The High Court held that these concurrent findings were findings of fact and that no material had been shown to establish them as illegal, erroneous, or perverse. In the absence of any substantial question of law, interference was not warranted.

Conclusion: The addition was not sustainable and the assessee succeeded.

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