TaxTMI 
TaxTMI 
2024 (5) TMI 1536
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.... of appeal raised by the revenue are as under: "1. "On the facts and circumstances of the case and in law, Ld. CIT (A) has erred in deleting the addition made of Rs.26,78,488/-on account of u/s 68 of the I.T.Act and Rs. 80,355/- on account of commission paid to the entry provider @ 35% of Rs. 26,78,488/- 2. "On the facts and circumstances of the case and in law, the Ld. CIT(A) has erred in deleting the additions of Rs. 26,78,488/- made on LTCG, without considering the fact that, AO has relied on the report of Investigation Wing of Income-Tax Department, who has published the discreet report with a list of penny stocks/scripts and the assessee by transacting in one of the penny stock ie "VAS Infrastructure Limit....
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....mati Dayal [1995] 80 Taxmann 89(SC)/(1995) 2014 ITR 801(sc)/[1995] 125 CTR 124 (SC) rendered by the Hon'ble Supreme Court, wherein it was held that the Court and Tribunal have to judge the evidence before it by applying the test of human probabilities, the surrounding circumstances which exercise had been done by the Assessing Officer?" 7 "On the facts and circumstances of the case and in law the CIT(A) erred in deleting the disallowance of Long Term Capital Gains of Rs.26,78,488/- overlooking the fact that the entire transactions were stage managed with the object to facilitate the assessee to plough back its unaccounted income in the form of fictitious Long Term Capital Gains and claim bogus exemption 8. "On the fact....
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....f the Act on 28.12.2018 after making an addition of Rs. 26,78,488/- u/s 68 of the Act on account of sale of shares of the penny stock companies M/s VAS Infrastructure Ltd. 4. Aggrieved by this order, the assessee filed an appeal before Ld.CIT(A) on 11.01.2019. Vide order dated 06.10.2023 the Ld.CIT(A)/NFAC allowed the assessee's appeal with the following observations: "Considering such coordinated orders of several courts involving transactions in the shares of M/s VAS infrastructure learned, it appears that these shares cannot be considered as penny stocks. Accordingly, both the additions made by the AO on account of bogus transaction in the shares of M/s VAS infrastructure Ltd. and undisclosed payment of commission, appear to ....
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....against average cost of 30.66. (page 110 of Paper Book). 10. 30,000 shares were sold in Financial Year 2010-11 (AY 2011-12) at an average sale price of 89.28 per share against average cost of 30.66. (page 109 of Paper Book). Only sale of one lot of 5000 shares on 11-11-2010 fetched a price of 188 per share, rest of the shares were sold for price ranging from 53/- to 85/- 11. It may also be noted that the shares purchased by the Respondent were held for a period of around four years which shows that the transactions were not used to facilitate introduction of unaccounted income in the form of exempt capital gain or short-term capital loss in the books of accounts as mentioned in the reasons recorded for reopening. ....
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.... "10. From the above observation, we are of the considered view that the assessee has furnished all the supporting documentary evidences to substantiate the genuinity of the said transaction. It is also evident that the assessee has not only invested in the scrip of M/s. Vas Infrastructure Ltd. but has also made investment of huge sum in other scrips as well. The fact that the assessee has not made any off line purchases and has not claimed LTCG but has merely incurred a nominal loss of Rs. 51,279/-, in our view, cannot be a case of doubtful investment in penny stock. The A.O. has also not made any enquiry as to the payments made by the assessee to the recognized broker nor has the A.O. brought on record any material evidence to sho....