MANU/IP/0151/2015

IN THE ITAT, PUNE BENCH, PUNE

I.T.A. No. 2235/PN/2013
Assessment Year: 2005-2006
Decided On: 31.03.2015
Appellants: Dhaval Shah
Vs.
Respondent: The Tax Recovery Officer & Assessing Officer, Range - 7
Hon'ble Judges/Coram:
G.S. Pannu, Member (A) and Sushma Chowla, Member (J)
Counsels:
For Appellant/Petitioner/Plaintiff: Deepa Khare
For Respondents/Defendant: B.C. Malakar
Case Note:
Direct Taxation - Cash credit - Treatment of - Commissioner sustained
addition made by Assessing Officer (AO) on account of unexplained cash
credit for Capital Gains - Hence, present appeal - Whether gain arising on
transaction of sale, purchase of shares was to be assessed under head
income from long term capital gains or income from other sources - Held,
name of broker through whom Assessee had transacted in shares did not
appear in list - Assessee had produced complete evidence of purchase of
shares and copy of shares certificate evidencing transfer of shares in name
of Assessee - Merely because shares were D-matted and thereafter, were
sold did not establish case of authorities below - Thus, gain arising on
transfer of shares was to be assessed as income from long term capital gain
in hands of Assessee - Therefore, order of Commissioner was reversed - AO
was directed to compute income under head income from long term capital
gains - Appeal allowed. [10] and[13] Facts: During the year under
consideration the Assessee had declared income from salary and income
from other sources. However, information was received from the
Investigation Wing that there was much manipulation in the purchase and
sale of shares of one company, therefore, reasons were recorded under
Section 147 of the Act and notice under Section 148 of the Act was issued
to the Assessee. The Assessee in reply, stated that the return filed under
Section 139 of the Act be treated as return filed under Section 148 of the
Act. The Assessing Officer observed that during the course of search and
seizure action conducted by the Income-tax Department at the office and
residential premises of several stock brokers and managers of financial
companies, it was found that there was much manipulations in the
purchase and sale of shares, in particular of shares of said company. During
the course of assessment proceedings, the assessee was asked to furnish
the details of purchase and sale of shares along with further evidences. The
Assessing Officer on the perusal of details, noted that the Assessee had
shown purchases of shares. The Assessee had shown the sale of entire
shares through one company and had claimed exemption from long term

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 capital gains under Section 10(38) of the Act. The Assessing Officer further
noted that search and seizure action were conducted in the case of certain
persons. Survey action was also conducted on company who had issued
bogus brokers note to the beneficiaries and the same was admitted by the
said concern. Further, statement of one of the brokers, was recorded in
which he admitted that during the years, he issued off market purchase
bills. As against this, the Assessee submitted that he was holding D-mat
account and through which, the transactions of the shares were carried out.
The Assessing Officer noted that the Assessee had opened D-mat account,
whereas the shares had been purchased and D-mated. The D-mat account
was utilized only for the purpose of transactions in the scrip under
consideration. Further, the entire purchase price was paid in cash. The
Assessing Officer was of the view that D-mat of scrip shares was done after
a long period because of backdating of share purchase transactions and
other stages. The Assessing Officer thus, held that the Assessee was
involved in penny stock shares and the long term capital gains shown by
the Assessee were not genuine and he held that the Assessee had
introduced his unaccounted money through accommodated transaction of
purchase and sale of penny stock shares. Accordingly, an addition was
made as unexplained cash credit under Section 68 of the Act. On appeal,
the Commissioner affirmed addition made by AO. Hence, present appeal.
Held: Treatment of cash credit: (i) The name of broker through whom the
Assessee had transacted in the shares did not appear in that list. Further,
the Assessee had produced complete evidence vis-Ã -vis the purchase of
shares and the copy of shares certificate evidencing transfer of shares in
the name of Assessee and further sale transaction through brokers, against
which the Assessee received the sale amount through cheque. In the
totality of the above said facts and circumstances, where the Assessee had
placed on record the complete evidence of purchase and sale of shares,
merely because the shares were D-matted and thereafter, were sold did not
establish the case of authorities below, in view of the circumstantial
evidence produced by the assessee. In the totality of said evidences, the
Assessee had purchased the said shares and also the company had
transferred the shares in the name of Assessee, against which the purchase
price was paid in cash, which was recorded in the books of account of the
share broker who was third party. Further, the said shares were purchased
and were shown as investment in the Balance Sheet. These shares were
sold establish the case of the Assessee in having transacted in the sale and
purchase of the said shares. Therefore, it was held that the gain arising on
transfer of shares was to be assessed as income from long term capital gain
in the hands of the Assessee. [10] (ii) Therefore, order of Commissioner
was reversed and direct the Assessing Officer to compute the income in the
hands of the Assessee under the head income from long term capital gains.
[13]
ORDER
Sushma Chowla, Member (J)
1 . This appeal filed by the assessee is against the order of CIT(A)-III, Pune, dated
30.08.2013 relating to assessment year 2005-06 against order passed under section
143(3) r.w.s. 147 of the Income Tax Act, 1961.

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 2. The assessee has raised the following grounds of appeal:-
1 . The Learned Assessing Officer has erred in making addition of Rs.
21,96,546/- on account of Unexplained cash credit for Capital Gains on the
basis statement of third party and evidence collected by the department
without giving opportunity of being heard as well as cross examining the
person concerned as per ratio of CIT Vs. Rajeshkumar (2008) 172 Taxman 74
(Del.)
2 . The appellant craves right to add, alter, delete, modify or amend any
change of all the above grounds of appeal before or during the course of
hearing.
3 . The only issue raised in the present appeal is in relation to the treatment of the
cash credit of Rs. 21,96,546/-.
4 . The brief facts of the case are that, during the year under consideration the
assessee had declared income from salary and income from other sources. However,
information was received from the Investigation Wing that there was much
manipulation in the purchase and sale of shares of Robinson Worldwide Ltd.,
therefore, reasons were recorded under section 147 of the Act and notice under
section 148 of the Act was issued to the assessee. The assessee in reply, stated that
the return filed under section 139 of the Act be treated as return filed under section
148 of the Act. The Assessing Officer vide para 4 of the assessment order observed
that during the course of search and seizure action conducted by the Income-tax
Department, Mumbai in the month of January, 2007 at the office and residential
premises of several stock brokers and managers of financial companies, it was found
that there was much manipulations in the purchase and sale of shares, in particular
of shares of Robinson Worldwide Ltd. The assessee was one of the beneficiaries, as
per the information received by Addl. DIT (Investigation) Wing-I, Pune. During the
course of assessment proceedings, the assessee was asked to furnish the details of
purchase and sale of shares along with further evidences. The Assessing Officer on
the perusal of details, noted that the assessee had shown purchases of 25,000 shares
of Robinson Worldwide Ltd. from G.R. Pandya Share Broking Ltd., Mumbai on
04.07.2003 for total consideration of Rs. 98,781/- and all the shares were sold for
Rs. 41,11,565/-. The assessee has shown the sale of entire shares during the period
10.02.2005 to 25.02.2005 through Renassance Securities Ltd., Mumbai and had
claimed exemption from long term capital gains under section 10(38) of the Act. The
Assessing Officer further noted that search and seizure action were conducted in the
case of Naresh Saboo and Naresh Jain and other beneficiaries in the scrip of
Robinson Worldwide Ltd. Survey action was also conducted on M/s. DPS Shares and
Securities Ltd., who had issued bogus brokers note to the beneficiaries and the same
was admitted by the said concern. Further, statement of Shri Sujal Shah, one of the
brokers, was recorded on 18.01.2007, in which he admitted that during the years
2003-04 and 2004-05, he issued off market purchase bills in the year 2005-06. As
against this, the assessee submitted that he was holding D-mat account and through
which, the transactions of the shares were carried out. The Assessing Officer noted
that the assessee had opened D-mat account on 03.02.2005, whereas the shares had
been purchased in July, 2003 and D-mated on 03.02.2005. The D-mat account was
utilized only for the purpose of transactions in the scrip under consideration. Further,
the entire purchase price was paid in cash. The Assessing Officer was of the view that
D-mat of scrip shares was done after a long period because of backdating of share
purchase transactions and other stages. The Assessing Officer thus, held that the

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 assessee was involved in penny stock shares and the long term capital gains shown
by the assessee were not genuine and he held that the assessee had introduced his
unaccounted money through accommodated transaction of purchase and sale of
penny stock shares. Accordingly, an addition of Rs. 41,11,565/- was made as
unexplained cash credit under section 68 of the Act.
5 . The CIT(A) after considering the various reliance placed upon by the learned
Authorized Representative for the assessee and in turn, relying on the ratio laid down
by the Mumbai Bench of the Tribunal in Arvind M. Kariya Vs. ACIT in I.T.A. No.
7024/Mum/2010, dated 30.01.2013, held as under:-
"7.6. In the present case the appellant has filed extracts of the cash book for
the year ending 31.03.2004 (relevant for A.Y. 2004-05) and the balance
sheet for that year attached to the return of the income for the A.Y. 2004-05
filed on 09.03.2005 to evidence the purchase of shares of Robinson Impex
Ltd. To my mind, therefore, the facts become immediately distinguishable at
the outset. The statement of the broker who had arranged the
accommodation entries has not been rebutted. On the facts of the case,
therefore, it is seen that the Assessing Officer has correctly held that the
appellant has manipulated the purchase of shares in cash with the help of the
broker. The delayed dematerialization of the shares is not generally the
accepted practice in sharing trading and renders the entire regulatory system,
put into place by SEBI and other regulatory authorities to prevent
manipulation in the stock market by brokers and other unscrupulous persons,
a failure. Therefore, I am in agreement with the Assessing Officer's view that,
in fact there is no real purchase or sale of share at all. It is the broker who
has manipulated the purchase cost in cash, arrange for the sale of shares by
showing the holding period to be more than 12 months and also arranged for
the dematerialization of the shares just prior to sale in order to make the
whole transaction appears genuine. The facts of the case are thus
distinguishable from Mukesh Marolia's case (supra). The appellant has also
placed reliance on Pune ITAT orders [n the cases of Shri Avinash Kantilal Jain
(I.T.A. No. 980/PN/2010) and Shri Ajay Shantilal Lalwani and Neelesh
Shantilal Lalwani (145 TTJ 511) but these are also seen to be
distinguishable.
7.7. The Bombay ITAT in the case of Arvind M. Kariya Vs. ACIT in I.T.A. No.
7024/Mum/2010 dated 30.01.2013 was examining a similar case where it
was held that the mere fact that shares purchased have been sent for
dematerialization by the assessee, does not prove the genuineness of the
same, even though they were transacted offline and not on the floors of a
stock exchange. The ITAT held as under:-
18. "The assesses has placed strong reliance on the sale transaction
which has been routed through Demat account and has been
executed through BSE. There is no dispute that the sale
consideration was received by the assessee from the sale of shares.
What is disputed is that whether they were actually purchased on the
purported date as claimed by the assessee. This raises the question
whether the apparent can be considered as the real. As laid down by
the Hon'ble Supreme Court in the case of CIT Vs Durga Prasad More
MANU/SC/0321/1971 : 82 ITR 540 (2002-TlOL-877-SC-IT), the
apparent must be considered as real only it is shown that there are

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 reasons to believe that the apparent is not the real and that too
'taxing authorities are entitled to look into the surround
circumstances to find out the reality and the matter has to be
considered by applying the test of human probability. For this
preposition we draw support from the decision of the Hon'ble
Supreme Court in the case of Sumati Dayal vs. CIT 214 ITR 0801
wherein in the Hon'ble Supreme Court has thus held:
"dismissing the appeal, that the Settlement Commission
after considering the surrounding circumstances and
applying the test of human probabilities had rightly
concluded that the appellant's claim about the amount being
her winnings from races was not genuine." Therefore, the
present case has to be considered in the light of human
probability. The transaction about purchases of shares in
physical form of sum companies whose share prices have
been rigged by some fraudulent operators cannot have any
direct evidences. An inference about such a purchase
connived with such companies have to be drawn on the
basis of the circumstances available on the record. As
pointed out, the shares have been transferred within 4 days
of the date of purchases raises ample doubt about the
credibility of the company. As pointed out in all
probabilities, the company must have been involved in such
fraudulent transactions. Post year 2000, it is improbable that
any person would transact in shares by taking physical
delivery of the shares. When many instances have been
surfaced relating to bad delivery or bogus scrips, the
regulatory authorities have made it compulsory to transact
through Demat account.
1 9 . Having regard to the circumstances and the conduct of the
assessee as disclosed in his statement u/s. 132(4) of the Act as well
as other material on record, inference could be reasonably drawn
that the shares purchased by the assesses have been backdated to
give it a colour of Long term capital gain by showing the period of
holding for more than 12 months.
2 0 . Needless to say that income tax proceedings are civil
proceedings and the degree of proof required is by preponderance of
probabilities, therefore applying the test of preponderance of
probabilities and considering the entire sequence of events, the
revenue authorities have rightly concluded that the assessee's claim
about the long term capital gains from the sale of shares is not
genuine.
21. Therefore, it cannot be said that the explanation offered by the
assessee in respect of the sale consideration has been rejected
unreasonably and that the findings that the said amounts are income
of the assessee from other sources is not based on evidence.
Accordingly, findings of the ld. CIT(A) are confirmed. Ground No. 1
is dismissed".

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 7.8. In the appellant's case, the source of purchase of shares is by way of
payment in cash. The appellant has placed on record that he does not
remember the name of the person from G.R. Pandya Share-broking Ltd., with
whom he had transacted for purchase of the shares. He did not also
remember the name of person from Renaissance Securities Ltd. with whom
he had transacted for sale of shares. The value of the shares of Robinson
Impex Ltd. which was purchased for Rs. 3.90 in July, 2003 is seen to have
jumped almost 50 times to Rs. 145.25 at the time of its sale at Feb. 2005.
The demat account of the appellant was also opened only in Jan 2005 and
the shares were dematted immediately thereafter in Feb, 2005. On
examination of the demat account shows that the shares which were
dematted on 3.2.2005 are sold through Renaissance Securities Ltd. on 11th,
15th, 17th, 21st and 26th Feb. 2005. At other place relating to the photocopy
of the pages of appellant's demat account the shares are seen to have been
sold through C.M. Mehta Securities Ltd. The purchase of the shares in cash,
the holding by the appellant in physical format, the non recollection of the
names of the persons with whom he has transected, the phenomenal growth
in the shares of Robinson Word wide Ltd. which have been investigated and
found by the Investigation agencies to be accommodation entries relating to
penny stocks and the rejection by the appellant of the opportunity offered to
cross examine the broker who admitted to providing off market
accommodation entries all point to the fact that there is no genuine
transaction relating to the purchase of the scrips in question. The entire
transactions relating to the sale and purchase of shares have been arranged
in order for the appellant to launder his unaccounted income into accounted
income. Therefore, the alternative contention that the capital gains may be
treated as short term capital gains cannot be accepted since it is found that
there are no genuine share transactions at all. Consequently, original ground
of appeal No. 1 fails.
6. The assessee is in appeal against the order of CIT(A).
7. The learned Authorized Representative for the assessee pointed out that during the
course of search, statement was recorded of Naresh Saboo, who was found to have
given accommodation entries, but the name of the assessee was not found in the list.
Our attention was drawn to the share certificate placed at page 20 of the Paper Book
along with vouchers for payment of the purchase price at pages 21 and 22 of the
Paper Book and evidence of market value of shares as on date of purchase placed at
page 26 of the Paper Book. The learned Authorized Representative for the assessee
pointed out that the investment was made by the assessee in assessment year 2004-
05, which was reflected in the balance sheet placed at page 14 of the Paper Book and
further, where the sale was not in dispute, there was no merit in the orders of the
authorities below. The learned Authorized Representative for the assessee further
contended that the Assessing Officer proceeded on the basis of search proceedings of
another broker, who was not connected to the assessee and where the Assessing
Officer had not pointed out any connection/nexus with the assessee and where even
opportunity of cross-examination was not given by the Assessing Officer, there was
no merit in the said addition. The learned Authorized Representative for the assessee
placed reliance on the ratio laid down by Pune Bench of the Tribunal in Smt. Smita P.
Patil & Ors. Vs. ACIT (2014) 159 TTJ (Pune) 182 and pointed out that the shares
purchased by the assessee therein were also purchased through M/s. DPS Shares and
Securities Ltd., and the Tribunal had held that the transaction of purchase was
genuine, in turn relying on the ratio laid down by the Hon'ble Bombay High Court in

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 Smt. Jamnadevi Agarwal MANU/MH/1685/2010 : 328 ITR 656 (Bom). Further reliance
was placed on the ratios laid down in the following cases:-
i) Avinash Kantilal Jain Vs. Addl. CIT (Pune) I.T.A. No. 980 & 1049/PN/2010,
order dated 31.10.2012
ii) CIT Vs. Smt. Damayanti M. Marolia in I.T.A. No. 154 of 2009, order dated
19.03.2009 (Bombay High Court)
iii) CIT Vs. Shri Mukesh Ratilal Marolia in I.T.A. No. 456 of 2007, order dated
07.09.2011 (Bombay High Court)
8 . The learned Departmental Representative for the Revenue pointed out that the
shares were purchased in July, 2003, which were D-mated only in October, 2005 i.e.
immediately before sale of shares between the period 10.02.2005 to 25.02.2005.
Further, reliance was placed on the observations of CIT(A) in paras 7.5 and 7.8 of the
appellate order.
9. We have heard the rival contentions and perused the record. The issue arising in
the present appeal is in relation to the sale transaction of shares of M/s. Robinson
Worldwide Ltd. The assessee had purchased 25,000 shares of M/s. Robinson
Worldwide Ltd. from G.R. Pandya Share Broking Ltd., Mumbai on 04.07.2003 for total
consideration of Rs. 98,731/-. The copies of contract notes of G.R. Pandya Share
Broking Ltd., Mumbai are placed on record, which reflects the purchase of the said
shares. The said shares were transferred in the name of assessee as per the share
certificate dated 17.10.2003. The copy of the said share certificate is placed at page
20 of the Paper Book. The assessee had made cash payments for the purchase of said
shares and the copy of account of assessee in the books of share broking company
along with cash receipts are placed at pages 21 and 22 of the Paper Book. The
assessee further claims that the said cash was drawn out of his books and the
relevant entries of cash in hand are also placed on record at page 23 of the Paper
Book. The assessee had purchased the said shares at the varying price between Rs.
3.85p to Rs. 3.91p. In support of the rates prevalent on the date of purchase, the
assessee has placed on record the list issued by Bombay Stock Exchange, which is
placed on record at pages 26 onwards of the Paper Book. The assessee had sold the
said shares during the period 10.02.2005 to 25.02.2005 through Renassance
Securities Ltd., Mumbai for total consideration of Rs. 41,11,565/-. The copy of the
contract note for the sale of the shares is also placed on record. The said shares were
sold at price varying between Rs. 145 to Rs. 177/-. The sale proceeds were received
by way of cheques and were deposited in the bank account of the assessee with
Standard Chartered Bank and confirmation of the said bank is placed at page 39 of
the Paper Book. The assessee had sold the said shares through D-mat account, which
was opened on 03.02.2005, on which date, the shares were first dematerialized. The
D-mat account was opened after a gap from the date of purchase of the shares and
this created a doubt in the minds of authorities below that the assessee had
transacted in the shares in order to get the accommodation entries for artificial dates.
Further, the Assessing Officer had received information that there was large scale
manipulation in the purchase and sale of shares of M/s. Robinson Worldwide Ltd. The
Income-tax Department, Mumbai had conducted survey and seizure actions at the
offices and residential premises of several stock brokers and managers of financial
companies. During the course of survey action conducted on M/s. DPS Shares and
Securities Ltd. by the Directorate of Investigation, Mumbai, the Director of brokerage
firm admitted that during the financial years, 2003-04, 2004-05 and 2005-06, bogus

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 market purchase bills and in some cases, sale bills had also been issued to the
beneficiaries. Accommodation bills were given to the beneficiaries as per the
instructions of one Shri Naresh Saboo and Naresh Jain. As per the investigation wing,
appellant was one of the beneficiaries and consequent thereto, the Assessing Officer
reopened assessment in the case of assessee.
10. The question which arises before us is the treatment of gain arising on the said
transaction of sale, purchase of shares is to be assessed under the head income from
long term capital gains as claimed by the assessee or under the head income from
other sources as determined by the authorities below. The first aspect to be
considered in the case of assessee is that though enquiries were made in respect of
several companies and brokers, but the name of broker through whom the assessee
had transacted in the shares of M/s. Robinson Worldwide Ltd. does not appear in that
said list. Further, the assessee has produced complete evidence vis-Ã -vis the
purchase of shares and the copy of shares certificate evidencing transfer of shares in
the name of assessee and further sale transaction through brokers, against which the
assessee received the sale amount through cheque. In the totality of the above said
facts and circumstances, where the assessee has placed on record the complete
evidence of purchase and sale of shares, merely because the shares were D-matted in
February, 2005 and thereafter, were sold in the month of February, 2005 itself, does
not establish the case of authorities below, in view of the circumstantial evidence
produced by the assessee. In the totality of said evidences, we hold that the assessee
had purchased the said shares and also the company had transferred the shares in
the name of assessee as early as on 17.10.2003, against which the purchase price
was paid in cash, which is recorded in the books of account of the share broker who
is third party. Further, the said shares were purchased in the financial year 2003-04
and were shown as investment in the Balance Sheet as on 31.03.2003, copy of which
is filed on record. These shares were sold in the financial year 2004-05 establish the
case of the assessee in having transacted in the sale and purchase of the said shares.
In the entirety of the above said facts and circumstances, we hold that the gain
arising on transfer of shares is to be assessed as income from long term capital gain
in the hands of the assessee.
11. We further find support from the ratio laid down by the Hon'ble Bombay High
Court in CIT Vs. Shri Mukesh Ratilal Marolia in Income Tax Appeal No. 456 of 2007,
vide order dated 07.09.2011, wherein it was held as under:-
"5. On further Appeal, the ITAT by the impugned order allowed the claim of
the Assessee by recording that the purchase of shares during the year 1999-
2000 and 2000-2001 were duly recorded in the books maintained by the
Assessee. The ITAT has recorded a finding that the source of funds for
acquisition of the shares was the agricultural income which was duly offered
and assessed to tax in those Assessment Years. The Assessee has produced
certificates from the aforesaid four companies to the effect that the shares
were in-fact transferred to the name of the Assesses. In these circumstances,
the decision of the ITAT in holding that the Assessee had purchased shares
out of the funds duly disclosed by the Assessee cannot lie faulted.
6 . Similarly, the sale of the said shares for Rs. 1,41,08,484/- through two
Brokers namely, M/s. Richmond Securities Pvt. Ltd. and M/s. Scorpio
Management Consultants Pvt. Ltd. cannot be disputed, because the fact that
the Assessee has received the said amount is not in dispute. It is neither the
case of the Revenue that the shares in question are still lying with the

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 Assessee nor it is the case of the Revenue that the amounts received by the
Assessee on sale of the shares is more than what is declared by the
Assessee. Though there is some discrepancy in the statement of the Director
of M/s. Richmand Securities Pvt. Ltd. regarding the sale transaction, the
Tribunal relying on the statement of the employee of M/s. Richmand
Securities Pvt. Ltd. held that the sale transaction was genuine.
7 . In these circumstances, the decision of the ITAT in holding that the
purchase and sale of shares are genuine and therefore, the Assessing Officer
was not justified in holding that the amount of Rs. 1,41,08,484/- represented
unexplained investment under Section 69 of the Income Tax Act, 1961
cannot be faulted.
8 . In the result, we see no merit in this Appeal and the same is dismissed
with no order as to costs."
12. The CIT(A) has given a finding in para 7.6 that the statement of broker, who had
arranged the accommodation entries has not been rebutted. However, it is to be
noted that the assessee had not purchased the shares from the said broker i.e. M/s.
DPS Shares and Securities Ltd., but had made the purchases from another broker i.e.
G.R. Pandya Share Broking Ltd., Mumbai. Further, no evidence has been brought on
record to establish that the assessee had purchased the shares from M/s. DPS Shares
and Securities Ltd. and in the absence of the same, we find no merit in the
allegations of authorities below that the assessee had manipulated the purchase of
shares in cash with the help of broker.
13. The Pune Bench of the Tribunal in Smt. Smita P. Patil & Ors. Vs. ACIT (supra)
has held that merely because there was delay in converting physical shares into
electronic form i.e. D-mat, that could not be the criteria to hold that the share
transactions were arranged and camouflage, as in all cases the assessee had recorded
their share transactions in regular books of account prior to date of search. It was
further pointed out by the learned Authorized Representative for the assessee that in
the case of Smt. Smita P. Patil & Ors. Vs. ACIT (supra), the transaction was with
regard to purchase of shares of M/s. Fast Track Entertainment Ltd., which in turn
were purchased through the share broker M/s. DPS Shares and Securities Ltd. and
the Tribunal had accepted the said transaction as genuine. Further, Pune Bench of the
Tribunal in Smt. Smita P. Patil & Ors. Vs. ACIT (supra), in similar circumstances had
held that the transaction of purchase and sale of shares of M/s. Fast Track
Entertainment Ltd. was a genuine transaction and the claim of long term capital gain
was allowed in the hands of the assessee therein. In the totality of the above said
facts and circumstances and the case laws, we find no merit in the order of CIT(A)
and reversing the same, we direct the Assessing Officer to compute the income in the
hands of the assessee under the head 'income from long term capital gains'. Thus,
the grounds of appeal raised by the assessee are allowed.
14. In the result, the appeal of the assessee is allowed.
Order pronounced on this 31st day of March, 2015.
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