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2016 (2) TMI 430 - AT - Income Tax


Issues involved:
1. Quantum appeal - Whether long term capital loss on the sale of shares was justified.
2. Penalty appeal - Whether penalty imposed by the Assessing Officer was justified.

Analysis:
1. Quantum Appeal:
The appeal involved the assessment of a long term capital loss claimed by the assessee on the sale of shares. The Assessing Officer disallowed the loss, which was confirmed by the CIT(A). However, the Tribunal directed a fresh examination of the matter. The CIT(A) observed discrepancies in the valuation of shares but noted that transactions were genuine and settled through banking channels. The Tribunal held that the Assessing Officer had no power to replace agreed sale consideration with fair market value. Relying on precedent cases, it concluded that the claimed loss was justified, dismissing the Revenue's appeal.

2. Penalty Appeal:
The penalty appeal was against an addition deleted in the quantum appeal. Since the Tribunal ruled in favor of the assessee in the quantum appeal, the penalty appeal became irrelevant and was dismissed. The Tribunal delivered the judgment on 11th December 2015, upholding the assessee's position on the quantum appeal and dismissing the penalty appeal filed by the Revenue.

 

 

 

 

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