2024 (12) TMI 702

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....mstances of the case and in law, the Ld. CIT (A) is justified in deleting the disallowance made by the AO of Rs. 9,11,83,666/- on account of STCL on sale of shares of M/s Mindtree Ltd. without appreciating the findings of the AO that the assessee has used colourable device to reduce its tax liability during AY 2016-17? 2. Whether on the facts and circumstances of the case and in law, the Ld. CIT(A) was correct in holding that the deletion of the disallowance of Rs. 9,11,83,666/- on account of STCL on sale of shares of M/s Mindtree Ltd. is fair and justified, failing to appreciate the decision of the Hon'ble Supreme Court in the case of Mc Dowell & Co. Ltd. vs. СТО (1985) 154 ITR 148 (SC) wherein the Apex Court in its....

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.... in the internet, he found that M/s Mindtree Ltd. had announced issuance of bonus shares on 18.01.2016 at the ratio of 1:1. He observed that as a result of issue of bonus shares, the price of share reduced almost to half its original price. According to Assessing Officer, taking advantage of such reduction in price of shares, the assessee sold the shares purchased earlier resulting in short term capital loss of Rs. 9,11,83,666/-. According to the Assessing Officer, by adopting colorable device of selling the shares of M/s Mindtree Ltd. having anticipated the reduction in price due to issuance of bonus shares, assessee arranged its affairs in a manner so as to derive maximum benefit by selling the shares purchased earlier at loss and deferri....

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....he shares of M/s Mindtree Ltd. and derived short term capital loss of Rs. 9,11,83,666/-. The shares of M/s Mindtree Ltd. were purchased by the assessee between the period 17.02.2016 to 04.03.2016 and were sold during the period 09.03.2016 to 31.03.2016. The Assessing Officer, neither has disputed these facts nor has any dispute with regard to the genuineness of the acquisition and sale of shares. The only grievance of the Assessing Officer is that after the issuance of bonus shares by M/s Mindtree Ltd., which resulted in reduction in the price of shares of M/s Mindtree Ltd. purchased by the assessee, the assessee, to reduce its tax liability had sold the shares of M/s. Mindtree Ltd. to derive short term capital loss and set it off against l....