9911796707
TMI Blog2021 (6) TMI 304X X X X Extracts X X X X X X X X Extracts X X X X ..... ed by the assessee before this Tribunal, it appears, that the assessee has used the sale consideration (after sale of other shares) for purchase of shares of Rockon Fintech and immediately thereafter, on sale of the said shares, the assessee has utilized the said sale consideration for purchase of other shares. The assessee has not made any gain from sale of those shares, nor has he claimed any exemption u/s 10(38) of the Act. Therefore as convinced that the intention of the assessee was not to make any gain out of purchase and sale of shares of penny stock company. No disallowance can be made, leave alone the disallowance of value of shares invested. - Assessee s appeal is allowed. - ITA No.1680/Hyd/2019 - - - Dated:- 15-4-2021 - Sm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ares are transferred to the beneficiary at a very nominal price and subsequently sold for high price whereby the beneficiary claims the LTCG arising therefrom as exempt from tax. The Assessing Officer observed that the share price pattern of Rockon Fintech started escalating during the financial year 2010-11 and there was a sharp fall in financial year 2011-12. Therefore, he was of the opinion that this a penny stock company and the assessee was asked to explain the source of investment in the shares of this company. The Assessing Officer observed that the sources of investment for purchasing the shares have not been explained by the assessee. He therefore, brought the sum of ₹ 2,35,644/- to tax as unexplained investment in penny stoc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... LTCG from the sale of shares and has never claimed it as exempt from tax. Thus, he submitted that the addition of ₹ 2,35,644/- as unexplained investment in penny stock is not warranted. 4. The learned DR, on the other hand, supported the orders of the authorities below. 5. Having regard to the rival contentions and the material on record, I find that the assessee has made the investment in the shares of Rockon Fintech in the year 2008-09 whereas the report of the investigation wing is dated 16.3.2018. Therefore, the argument of the assessee s counsel that the assessee could not have known that Rockon Fintech is a penny stock company in the year of purchase of shares is quite acceptable. It is also seen from the Paper Book filed ..... X X X X Extracts X X X X X X X X Extracts X X X X
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