2012 (3) TMI 605

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....y. They were heard together. For the of convenience, they are disposed of by this common order. 2. The only issue in both appeals is the alleged computation of long-term capital gain in respect of alleged uncoated shares of group companies.. 3. The grounds of appeal for the assessment year 2005-06 are as under: - "In the course of assessment proceedings, the additions were made to the tune of Rs. 64,62,871/- as the asessee had claimed LTCG of the said amount which was treated as in genuine as the gain pertain to trading in penny stocks. During the year, the assessee had indulged in sale of two scripts, namely PSL Financial Services Ltd and G.K Consultants Ltd In the process of sale of the above-mentioned script the a....

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....ificial market of the Scripts. The Companies in which investments were made were devoid of fundamentals and the assessee had no such prior experience or background in trading of shares. 3. That Ld. CIT(A) erred in failing to appreciate the fact that the assessee claimed to have earned such huge amount of Capital Gain by mere sale of two penny stocks listed in Calcutta Stock Exchange namely G.K Consultant Ltd and Sarang Viniyog Ltd." 5. As it is a clear picture of dispute, we heard the learned DR at length and the learned counsel for the assessee. In response to AO's request, the Calcutta Stock Exchange gave their reply. Query was relating to provide trade details of the assessee's broker, Basant Periwal & Co. on dates on which t....

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.... reason on the part of the Assessing Officer for disallowing the claim of the assessee. 7. After considering the rival submissions, we are of the view that the impugned order of the learned Commissioner of Income-tax (Appeals) is quite justified. The Assessing Officer has doubted the transaction since the selling broker. was subjected to SEBI's action. However, the demat account given the statement of transactions from 1-4-04 to 31-03-2005 i.e. relevant for the assessment year under appeal [2005-06] filed before us. There cannot be any doubt the transaction much as observed by the Assessing Officer. The transactions were as per norms under controlled by the Securities Transaction Tax, brokerage service tax and cess, which were already pa....