2022 (12) TMI 1347

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.... the Ld.CIT(A) is arbitrary, illegal and bad in law. 2. For that on the facts and circumstances of the case the Ld. C,I.T(A) erred in confirming the action of the AO in treating the sale consideration of shares of M/s. Unishire Urban Infra Limited on which long term capital gain was shown as unexplained cash credit u/s. 68 of the I.T. Act 3. For that the Ld. CXT(A) erred in confirming the addition u/s. 68 when all the evidences were filed to prove the genuineness of the transactions and the addition made simply on suspicion on the basis of information from the Investigation Wing is unjustified and not in accordance with law. 4. For that the Ld. C.I.T(A) erred in confirming the addition u/s. 68 when he should have ....

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....erefore he is not arguing this on merit as admittedly it has to be decided against the assessee however the assessee is vociferously praying for allowing the short term loss sustained on sale of shares of Rs. 66,16,432/- which was arising from the sale of penny stocks which was rejected by the AO. The Ld. A.R. submitted that though the quantification of short term loss was not in dispute and has been examined by the AO, and given a finding that this loss was bogus loss and thus denied setting off of the said loss of Rs. 66,16,432/- against long term capital gain which may be allowed as any income has to be assessed only after computation of various positive and negative income arising from the same source of income. 5. Facts in brief are....

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....ale of shares of M/s SRK Industries Ltd. According to AO, both these shares are penny stocks. We find that the AO added the entire sale consideration realized from sale of shares of M/s Unishire Urban Infra Ltd. while the entire loss sustained on sale of shares of M/s SRK Industries ltd. was treated as bogus and no set off was allowed. In our considered view, though the case of the assessee falls within the ambit of the ratio laid down by the Hon'ble Calcutta High Court in the case of Swati Bajaj (supra) that the gains on the penny stocks are taxed and no exemption is available u/s 10(38) of the Act however the long term capital gain has to be computed in totality on all the shares as a whole and should be brought to tax accordingly. In our....