2020 (3) TMI 1334

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..... ansactions having more than five year holdings. Just because the company whose shares the assessee has dealt in has been identified as a Penny Stock, cannot make the transactions of the assessee ineligible for the deduction u/s.10(38). Assessing Officer is directed to grant the assessee the benefit of deduction u/s.10(38) as claimed. - Decided in favour of assessee.
SHRI GEORGE MATHAN, JUDICIAL MEMBER For the Appellant : Mr. Suresh Kumar, C.A. For the Respondent : Ms. R. Anitha, JCIT ORDER PER GEORGE MATHAN, JUDICIAL MEMBER: This is an appeal filed by the assessee against the order of the learned Commissioner of Income Tax (Appeals)-5, Chennai in I.T.A No.198/CIT(A)-5/2018-19 dated 31.07.2019 for the Assessment Year 2011-12. 2. Mr. .....

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..... nt and payments through the Bank account. It was a submission that the Assessing Officer and the learned Commissioner of Income Tax (Appeals) treated the transactions as Penny Stock Transactions and disallowed the assessee's claim u/s.10(38) of the Income Tax Act, 1961. It was a submission that the issue is now squarely covered by the decision of the Co-ordinate Bench of this Tribunal in respect of similar transactions where the purchases and sales had been done through the recognized stock exchange, through Demat account and the payments processed through banks alone. It was further a submission that in the assessee's case, the situation was better in so far as the assessee has been holding the shares for more than five years. He relied up .....

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..... med in respect of long term capital gains generated by purchase and sale of shares of M/s.Sulabh Engineers and Services Ltd., as claimed by the assessee." 4. In reply, the learned Departmental Representative vehemently supported the order of the Assessing Officer and the learned Commissioner of Income Tax (Appeals). 5. I have considered the rival submissions and perused the materials available on record. 6. A perusal of the facts in the present case shows that the disallowance of the assessee's claim of deduction u/s.10(38) of the Income Tax Act, 1961 has been made by the Assessing Officer and upheld by the learned Commissioner of Income Tax (Appeals) only on presumption. Clearly the facts in the present case shows that the transactions .....

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