The ITAT considered an addition made u/s 68 for the sale of shares as an 'unexplained source of...

The ITAT considered an addition made u/s 68 for the sale of shares as an 'unexplained source of investment'. The assessee, a foreign company tax resident of Mauritius, had held the shares for almost 10 years before selling them. The tribunal found the price increase over the years reasonable, unlike typical penny stock cases. The financials of the company whose shares were sold were substantiated, showing it was not a bogus entity. The AO's concerns about debt levels not correlating with sales were dismissed. The assessee, a SEBI registered FPI, had legitimate income from investments. The tribunal noted a High Court ruling that supported long-term share retention as genuine investment. The ITAT allowed the assessee's appeal, concluding the share transaction was genuine, directing deletion of the addition u/s 68. .....

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