TaxTMI 
TaxTMI 
2025 (2) TMI 819
X X X X Extracts X X X X
X X X X Extracts X X X X
....of Rs. 1,29,20,843/- made under Section 68 of the Income Tax Act, 1961 [hereinafter referred to as "the Act"] by the Dy. Commissioner of Income Tax, Central Circle-1(1), Ahmedabad [hereinafter referred to as "AO"]. Facts of the Case: 2. The assessee filed the return of income for A.Y. 2015-16 on 24-09-2015, declaring a total income of Rs. 58,42,990/-, which was processed under Section 143(1) of the Act. The case was subsequently picked up for scrutiny, and a notice under Section 143(2) of the Act was issued and duly served upon the assessee. The assessee had declared total Long-Term Capital Gain (LTCG) of Rs. 1,29,20,843/- including the LTCG arising from the sale of shares of Kappac Pharma Ltd. (KPL). The assessee had purchased 53,000....
X X X X Extracts X X X X
X X X X Extracts X X X X
....remained in force at the time of assessment. 3. The sale of KPL shares by the assessee was examined, and it was found that the counterparties were Affluence Commodities Pvt. Ltd. and Unipon India Ltd. (formerly Oasis Textiles Pvt. Ltd.). 4. The AO also noted that Affluence Commodities Pvt. Ltd. was involved in tax evasion schemes by booking fictitious losses, while Unipon India Ltd. was a suspended company on BSE, further indicating accommodation entries rather than genuine transactions 3.2. The AO issued a show cause notice on 06.11.2017, asking why the LTCG of Rs. 1,29,20,843/- should not be treated as bogus and added to total income. In response, the assessee submitted a reply on 09.11.2017, contending that the share....
X X X X Extracts X X X X
X X X X Extracts X X X X
....substantial documentary evidence supporting the genuineness of the LTCG claim. 5. Not satisfied with the order of the CIT(A), the revenue preferred an appeal before us with following grounds of appeal: 1. On the facts and in the circumstances of the case and in law, the Ld.CIT(A) has erred in deleting the addition of Rs. 1,24,19,369/- made under section 68 of the Act despite the fact that the assessee failed to prove the genuineness of the transaction? 2. On the facts and circumstances of the case and in law, the Ld.CIT(A) has failed to appreciate that the Assessing Officer has categorically established the LTCG on sale of shares of Kappac Pharma Ltd was non-genuine and there was no financial credentials to justify such....
X X X X Extracts X X X X
X X X X Extracts X X X X
....r Section 133(6) of the Act and the CIT(A), after examining these documents, ruled in favor of the assessee, accepting the genuineness of the transactions. The AR specifically pointed out that the AO had issued a notice u/s 133(6) of the Act to the broker, who confirmed that the shares were genuinely purchased through stock exchange transactions. The AR argued that this confirmation from broker directly contradicts the Departmental Representative's argument that the purchase was not genuine. The AR placed on record the judgment of the Gujarat High Court in a similar matter, where the same shares were held to be genuine transactions. The AR also cited a decision of the co-ordinate bench in the case of Denisha Rajendra Keshwani (wife of t....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... there is specific material to prove that the transaction is a sham. Furthermore, the Co-ordinate bench, in the case of Denisha Rajendra Keshwani (ITA No. 39/Ahd/2021), dismissed the Revenue's appeal in a case with identical facts, holding that the assessee had duly discharged the onus by providing all necessary documents, while the Revenue failed to rebut them with substantive material. 8.2. We also find that the judicial precedents relied upon by the DR do not apply to the present case. In case of Swati Bajaj (supra) the assessee had purchased shares off-market at a nominal price and sold them at an artificially inflated price, allegedly without any supporting financials. However, in the present case, the assessee purchased shares at a....