INCOME TAX OFFICER, JAIPUR V. RENU AGARWAL, JAIPUR

ITA 502/JPR/2025

AI Insights

The case involves an appeal by the Revenue against the order of the CIT (A), which had allowed the appeal of the assessee, Renu Agarwal, and deleted the addition of Rs. 20,17,964 made by the AO as deemed income under Section 68 of the Income Tax Act, 1961. The AO had alleged that the transactions in the shares of Eins Edutech Ltd., a penny stock, were part of a fraudulent scheme to book undue profits. The CIT (A) found that the AO had not substantiated these allegations with concrete evidence and that the assessee had made genuine transactions. The Tribunal agreed with the CIT (A) and dismissed the Revenue's appeal.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 777623 (ITAT-JAIPUR)
• Duration Of Justice: 6 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-09-2025
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2015-2016
• Appeal Filed On: 28-03-2025
• Other Referred Cases: CIT vs. Durga Prassad More, CIT vs. Smt. Sumitra Devi, Commissioner of Income-tax-I vs. Maheshchandra G. Vakil, Commissioner of Income-tax-I vs. Himani M. Vakil
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ANITA RINES H
• Assessee Lawyers: SHAILESH MANTRI
• Keywords: Unexplained cash credit; Cost of acquisition; Principle of natural justice; Assessment record; Deemed to accrue or arise in india; Share purchase agreement; Non compliance; Penny stocks; Bogus
• Section: 143(3); 68

Judgement Text

" vk;dj vihyh; vf/kdj.k] t;iqj U;k;ihB] t;iqj IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES,”A” JAIPUR Mk0 ,l- lhrky{eh] U;kf;d lnL; ,oa Jh jkBkSM+ deys'k t;UrHkkbZ] ys[kk lnL; ds le{k BEFORE: DR. S. SEETHALAKSHMI, JM & SHRI RATHOD KAMLESH JAYANTBHAI, AM vk;dj vihy la-@ITA. No. 502/JPR/2025 fu/kZkj.k o\"kZ@Assessment Years : 2015-16 Income Tax Officer Ward-4(1), Jaipur. cuke Vs. Renu Agarwal 70A, Devdhara Colony, Murlipura Scheme, Murlipura, Jaipur. LFkk;h ys[kk la-@thvkbZvkj la-@PAN/GIR No.: AGDPA7479A vihykFkhZ@Appellant izR;FkhZ@Respondent fu/kZkfjrh dh vksj ls@ Assessee by : Shri Shailesh Mantri, C.A. jktLo dh vksj ls@ Revenue by : Mrs. Anita Rinesh, JCIT, Sr.DR a lquokbZ dh rkjh[k@ Date of Hearing : 10/07/2025 mn?kks\"k.kk dh rkjh[k@Date of Pronouncement : 30 /09/2025 vkns'k@ ORDER PER: RATHOD KAMLESH JAYANTBHAI, AM This is an appeal filed by the Revenue against the order of ld. Addl/JCIT (A), Madurai dated 20.01.2025 passed under section 250 of the I.T. Act, 1961, for the assessment year 2015-16. 2. The Revenue has raised the following grounds of appeal :- “1. Whether on the facts and circumstances of the case and in law, the ld. CIT (A) was right in allowing assessee’s appeal without appreciating the fact that the AO has recorded reasons after analyzing the information available on records ? 2. Whether on the facts and circumstances of the case and in law, the ld. CIT (A) was right in deleting the addition of Rs. 20,17,964/- made by the Printed from counselvise.com ITA No. 502/JPR/2025 Renu Agarwal, Jaipur. 2 AO treating it as deemed income of the assessee u/s 68 of the I.T. Act 1961 without considering the facts of the case? 3. Whether on the facts and circumstances of the case and in law, the ld. CIT (A) was right in ignoring the fact that the assessee was involved in dealing of purchase and sale of shares in the scrip of Eins Edutech (Penny stock), the transactions cannot be considered as genuine? 4. Whether on the facts and circumstances of the case and in law, the ld. CIT (A) was right in deleting the additions made by the AO without appreciating the facts elaborated by the AO in assessment order and evidences on record. 5. The appellant craves leave or reserves right to amend, modify, alter, add or forego any ground(s) of appeal at any time before or during the hearing of this appeal.” 3. The brief facts of the case are that the assessee is engaged in trading and investments in Stock Market and had invested in the shares of various companies including “EINS Edutech Ltd. For the period under consideration the assessee was having income from investments in shares and income from interest and other sources. During the year under consideration the assessee purchased and sold some shares which resulted in STCG and also earned income from interest dividend and some petty income from F &O and day to day share trading. The assessee for the assessment year 2015-16 has filed her return of income declaring a total income of Rs. 2,47,590/-. The case was selected for scrutiny and the appellant through its Authorized Representative had submitted all the necessary documents as and when required by the AO to explain the return of income. The AO considered the submissions of the assessee but Printed from counselvise.com ITA No. 502/JPR/2025 Renu Agarwal, Jaipur. 3 being not satisfied with the explanations furnished by the assessee, the AO had passed the order stating, “The entire transaction with the scrip was fraudulent, manipulative and deceptive, which was predetermined and pre-decided and you were part of the system as one of such beneficiaries, who appeared to be waiting on the sideline after initial purchase, and off loaded the shares to complete the circle of events. Therefore, this is a clear case of derived income from such arranged transaction and claimed it as STCG and adjusted against the income from other shares, definitely the income is chargeable to tax as unexplained cash credit u/s 68 and to be added to the income of the assessee.” And passed the order under section 143(3) of the IT Act, 1961 by making addition of Rs. 20,17,964/-, being the whole amount and sale consideration of shares as Income as per provisions of Section 68 of the Act. 4. Aggrieved by the assessment order, the assessee preferred appeal before the ld. CIT (A), who after considering the detailed submissions on record and explanations furnished by the assessee, partly allowed the appeal of the assessee by observing as under:- “ 5.5. The case laws stated by the AO CIT vs. Durga Prassad More ruled that the taxing authorities are entitled to look into the surrounding circumstances to find out the reality and the matter has to be considered by applying the test of human probabilities is applicable to this case. The AO has squarely applied the report and finding of the investigation wing that anybody who has traded in the Printed from counselvise.com ITA No. 502/JPR/2025 Renu Agarwal, Jaipur. 4 M/S. Eins Edutech Limited has done this to make undue or bogus profit. The finding of the investigation wing is that – The report speaks about as many as 84 penny stock companies whose shares were manipulated or exploited to book either long term capital gain which is exempt from tax or short term capital loss for set off with other nature of income so as to reduce the tax liability. The stock is held for 12 months in which time price is artificially raised to a significant level and the said stock is sold with the assistance of the broker which is also in connivance of the promoter. The SEBI after making intensive inquiry in to movement of price of shares of such companies have reached to the conclusion that the sales of shares of such companies are camouflaged as Capital gain. 5.6. The appellants case does not fall in this category and the appellant has made short term capital gain chargeable to tax at normal rates and has not made any undue advantage in dealing with the penny stock M/S. Eins Edutech Limited. Thus the AO instead of blindly following the report of investigation wing must have looked into surrounding circumstances to find out the reality and the matter has to be considered by applying the test of human probabilities as decided by the Court in CIT vs. Durga Prasad then the AO must have realized that the appellant has not made any undue tax advantage or gain in this transaction. The addition made by the AO is hereby deleted and the grounds raised by the appellant are allowed to this extent. The other grounds are not adjudicated as the appellant has already got relief.” The Hon’ble Rajasthan High Court in the case of CIT vs. Smt. Sumitra Devi in ITA 54/2012 has held as under :- “True it is that several suspicious circumstances were indicated by the AO but then, the findings as ultimately recorded by him had been based more on presumptions rather than on cogent proof. As found concurrently by the CIT (A) and the ITAT, the AO had failed to show that the material documents placed on record by the assessee like broker’s note, contract note, relevant extract of cash book, copies of share certificate, de-mat statement etc. were false, fabricated or fictitious. The appellate authorities have rightly observed that the fact as noticed by the AO, like the notice under Section 136 to the company having been returned unserved; delayed payment to the brokers; and de- materialisation of shares just before the sale would lead to suspicion and call for detailed examination and verification but then, for these facts alone, the transaction could not be rejected altogether, particularly in absence of any cogent evidence to the contrary.” Printed from counselvise.com ITA No. 502/JPR/2025 Renu Agarwal, Jaipur. 5 The Hon’ble Gujarat High Court in the case of Commissioner of Income-tax-I vs. Maheshchandra G. Vakil [2013] (Gujarat) held that – “Where assessee proved genuineness of share transactions by contract notes for sale and purchase, bank statement of broker, demat account showing transfer in and out of shares, as also abstract of transactions furnished by stock exchange, Assessing Officer was not justified in treating capital gain arising from sale of shares as unexplained cash credit.” The Hon’ble Gujarat High Court in the case of Commissioner of Income-tax-I vs. Himani M. Vakil (Gujarat) held that – “ Where assessee proved genuineness of share transactions by bringing on record contract notes for sale and purchase, bank statement of broker and demat account showing transfer in and out of shares, Assessing Officer was not justified in bringing to tax capital gain arising from sale of shares as unexplained cash credit.” 4.1 Being aggrieved with the above finding of the ld. CIT (A), the revenue came in appeal before the Tribunal on the grounds captioned herein above. 5. Before us, the ld. DR vide letter dated 09.07.2025 submitted the written submission which are reiterated herein below :- “ BEFORE THE ADJUDICATING OFFICER SECURITIES AND EXCHANGE BOARD OF INDIA [ADJUDICATION ORDER NO. ASK/AO-33/2014-15] UNDER SECTION 15-I OF SECURITIES AND EXCHANGE BOARD OF INDIA ACT, 1992 READ WITH RULE 5 OF SEBI (PROCEDURE FOR HOLDING INQUIRY AND IMPOSING PENALTIES BY ADJUDICATING OFFICER) RULES, 1995. In respect of Sanjay Salunkhe (PAN:AAGPS2938F) In the matter of Eins Edutech Limited Printed from counselvise.com ITA No. 502/JPR/2025 Renu Agarwal, Jaipur. 6 FACTS OF THE CASE IN BRIEF 1. An open offer was made by Westfield Apparels Private Limited in terms of SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 2011 (hereinafter referred to as “SAST Regulations, 2011”) to the equity shareholders of Eins Edutech Limited (hereinafter referred to as “EFL/Company”), Target Company, through a public announcement dated December 29, 2012 for acquisition of 70,200 fully paid up equity shares of the face value of Rs. 10 each, representing 26% of total equity and voting share capital of the Target Company at a price of Rs. 55/- per equity share payable in cash. The equity shares of the Target Company are listed at BSE Limited and the Calcutta Stock Exchange Limited. 2. Securities and Exchange Board of India (hereinafter referred to as “SEBI”) examined the letter of offer pertaining to the aforesaid open offer and observed that Shri Sanjay Salunkhe (hereinafter referred to as “Noticee”) had acquired 1,76,450 shares of EEL on September 18, 2010. As this transaction led to acquisition of 72.02% of share capital of EEL by the Noticee, it required a disclosure within 2 days of transaction i.e. by September 20, 2010 as stipulated by regulations 7(1) read with regulation 7(2) of SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 2011 (hereinafter referred to as “SAST Regulations, 1997”). However, no disclosures as stipulated by the afore-mentioned regulations, for the said transaction dated September 18, 2010 was made by the Noticee. APPOINTMENT OF ADJUDICATING OFFICER. 3. Shri Piyoosh Gupta was appointed as Adjudicating Officer vide order dated July 24, 2013 under section 151 of the Securities and Exchange Board of India Act, 1992 (hereinafter referred to as “SEBI Act”) read with rule 3 of SEBI (Procedure for Holding Inquiry and Imposing Penalty by Adjudicating Officer) Rules, 1995 (hereinafter referred to as the ‘Rules’) to inquire into the adjudge under section 15A(b) of the SEBI Act for the alleged violations of provisions of Regulation 7(1) read with regulation 7(2) of SAST Regulations, 1997; read with Regulation 35 of SAST Regulations, 2011 by the Noticee. Subsequently, upon the transfer of Shri Printed from counselvise.com ITA No. 502/JPR/2025 Renu Agarwal, Jaipur. 7 Piyoosh Gupta, I have been appointed as Adjudicating Officer, in the present matter, vide order dated November 08, 2013. SHOW CAUSE NOTICE, REPLY AND PERSONAL HEARING. 4. Show Cause Notice no. EAD-5/ADJ/ASK/AA/OW/6445/2014 dated February 28, 2014 (hereinafter referred to as “SCN”) was issued to the Noticee under rule 4 of the Rules to show cause as to why an inquiry should not be initiated and penalty be not imposed under section 15A(b) of the SEBI Act for the alleged violation specified in the SCN. It was alleged in the SCN that Noticee has violated the provisions of regulation 7(1) read with regulation 7(2) of the SAST Regulations, 1997 read with regulation 35 of SAST Regulations, 2011. The copies of the documents relied upon in the SCN were provided to the Noticee along with the SCN. Noticee vide letter dated March 16, 2014 sought time of three weeks for submitting a detailed reply in the matter. The notice filed its reply vide letter dated April 14, 2014. In the interest of natural justice and in order to conduct an inquiry in terms of rule 4(3) of the Rules, the Noticee was granted an opportunity of personal hearing on April 16, 2014 vide notice dated April 02, 2014. On the date of hearing, Advocate Shri Abhishek Borgikar, Senior Associate, Alliance Corporate Lawyers and Shri Ajaykumar Mistry, appeared as Authorized Representatives (ARs) on behalf of the Noticee. ARs reiterated the written submissions made vide letter dated April, 14, 2014 and submitted that they would be filing additional written submissions in a week’s time. The notice filed additional written submissions vide letters dated April 22, 2014 and April 24, 2014. Noticee’s main submissions in respect of the charges in the SCN are given as under :  Noticee entered into a share purchase agreement (SPA) with the then promoters of the company i.e. Thyrocare Diagnostics Private Limited and Thyrocare Biotech Private Ltd. on September 18, 2010 for acquisition of 1,76,450 equity shares representing 72.02% of total paid up capital of the company. Pursuant to the aforesaid SPA, Regulation 10 and 12 of SAST Regulations, 1997 was triggered and accordingly notice made a public announcement on September 21, 2010 to the then shareholders of the company to acquire 20% of the then total paid up capital of the company.  On successful completion of the open offer, Noticee acquired 1,76,450 equity shares representing 72.02% of total paid up Printed from counselvise.com ITA No. 502/JPR/2025 Renu Agarwal, Jaipur. 8 capital of the company on January 15, 2011. These shares were transferred in name of the notice in the register of the company on January 15, 2011.  Noticee was under obligation to make disclosure under regulation 7(1) read with 7(2) of SAST Regulations, 1997. As the open offer was already made to public shareholders and exit opportunity was offered to public shareholders, Noticee was under genuine impression that no further disclosures were required to be made under any other provision of SEBI Takeover Regulations.  Referring to the judgment of Hon’ble Securities Appellate Tribunal in the matter of ‘Milan Mahendra Securities Pvt. Ltd. vs. SEBI’. Noticee submitted that he had made the Public Announcement about the acquisition of shares in the company on September 21, 2010 i.e. nearly 4 months before the actual date of acquisition. This disclosure to the public at large was made much before the similar disclosure under regulation 7(1) read with regulation 7(2) was required to be made. Further, Noticee also provided an exit opportunity to shareholders through open offer. This clearly demonstrates that the investors were aware and well informed about noticee’s acquisition of shares in the company and even exit opportunity was also offered to them. Therefore, the spirit behind the legislative intent for making disclosures is fulfilled. The non-disclosure of regulation 7(1) read with regulation 7(2) was merely a technical default and notice had made all disclosures about his acquisition to the public at large including the company’s shareholders through the open offer made by him in compliance with SEBI Takeover Regulations. After receipt of the Show cause Notice, Noticee made the proper disclosure under regulation 7(1) of SEBI Takeover regulations.  Noticee was appointed as additional director and managing director of the company on January 15, 2011. On the same dater notice made a disclosure in respect of acquisition of 72.05% shares to the company in compliance of regulation 13(2) of SEBI PIT regulations. Thereafter, the company had made proper disclosure to BSE under regulation 13(6) of SEBI PIT Regulations on January 17, 2011. It clearly demonstrates that the information required to be disclosed under regulation 7(1) of SEBI take regulations in respect of actual acquisitions of shares on January 15, 2011 was disclosed to BSE and was very well in public domain on January 17, 2011. Printed from counselvise.com ITA No. 502/JPR/2025 Renu Agarwal, Jaipur. 9  Referring to the judgment of Hon’ble Securities Appellate Tribunal in the matter of ‘Vitro Commodities Private Limited vs. SEBI’, Noticee submitted that such compliance of regulation 13(2) be treated as sufficient compliance and delay of filing disclosure under regulation 7(1) of SEBI Takeover regulations be condoned.  The scrip of the company was infrequently traded at that particular point of time and there were hardly any transactions in the scrip. The said non-disclosure under regulation 7(1) read with regulation 7(2) of SEBI Takeover regulations is a minor and technical violation as the information about the acquisition of shares of Company was in public domain much before the actual date of acquisition and even the exit opportunity was provided to the shareholders of the company.  No disproportionate gain or unfair advantage has been made by me as a result of default. No loss has been caused to any investor or group of investor as a result of my default. Default is one time default and not of repetitive in nature. CONSIDERATION OF ISSUES AND FINDINGS 5. I have carefully perused the oral and written submissions of the Noticee and the documents available on record. The issues that arise for consideration in the present case are : a. Whether the Noticee had violated the provisions of regulation 7(1) read with regulation 7(2) of the SAST Regulations, 1997? b. Does the violation, if any, attract monetary penalty under section 15A(b) of SEBI Act ? c. If so, what would be the monetary penalty that can be imposed taking into consideration the factors mentioned in section 15J of SEBI Act ? 6. Before moving forward, it is pertinent to refer to the relevant provisions of SAST Regulations, 1997 which reads as under :- SAST Regulations, 1997 “Acquisition of 5 per cent and more shares or voting rights of a company. 1. (1) Any acquirer, who acquires shares or voting rights which (taken together with shares or voting rights, if any, held by him) would entitle him to more than five per cent or ten per cent or fourteen per cent or Printed from counselvise.com ITA No. 502/JPR/2025 Renu Agarwal, Jaipur. 10 fifty four per cent or seventy four per cent shares or voting rights in a company, in any manner whatsoever, shall disclose at every stage the aggregate of his shareholding or voting rights in that company to the company and to the stock exchanges where shares of the target company are listed. (1A) ….. (2) The disclosures mentioned in sub-regulations (1) and (1A) shall be made within two days of, - (a) The receipt of intimation of allotment of shares; or (b) The acquisition of shares or voting rights, as the case may be.” Finding The issues for examination in this case and the findings thereon are as follows: (a) Whether the Noticee had violated the provisions of regulation 7(1) read with regulation 7(2) of the SAST Regulations, 1997 ? 2. Upon perusal of submissions of the Noticee and documents available on record, I find that Noticee had admittedly entered into a share purchase agreement (SPA) with the then promoters of the company i.e. Thyrocare Diagnostics Private Limited and Thyrocare Biotech Private Ltd. on September 18, 2010 for acquisition of 1,76,450 equity shares representing 72.02% of total paid up capital of the company. Pursuant to the aforesaid SPA, Noticee made a public announcement on September 21, 2010 to the then shareholders of the company to acquire 20% of the then total paid up capital of the company and on completion of the open offer, he acquired 1,76,450 equity shares representing 72.02% of total paid up capital of the company on January 15, 2011. 3. It has been alleged in the SCN that the notice had acquired these shares on September 18, 2010 and he was required to make a disclosure within 2 days of transaction i.e. by September 20, 2010, as stipulated by regulations 7(1) read with regulation 7(2) of SAST Regulations, 1997. However, the notice has claimed that the said shares were acquired by him on January 15, 2011 on completion of open offer and on the same date the said shares were transferred in his name in the register of EEL. In support of his claim notice also submitted the copy of relevant pages of register of EEL showing that his name was entered as a member in the register of EEL on January 15, 2011. Noticee also submit6ted the shareholding patterns filed Printed from counselvise.com ITA No. 502/JPR/2025 Renu Agarwal, Jaipur. 11 by the company with BSE for the quarter ended December 2010 and March 2011 which showed that the Noticee for the first time was shown as promoter of EEL only in the quarter ended March 2011. I tend to agree with the submissions of the notice that he acquired 1,76,450 shares of EEL only on January 15, 2011 and not on September 18, 2010 as has been alleged in SCN. Be that as it may, the fact remains that the notice had not made the disclosure within 2 days of the acquisition as stipulated by regulations 7(1) read with regulation 7(2) of SAST Regulations, 1997. Noticee in his reply has also admitted that he was under obligation to make the disclosure under the afore-mentioned regulations and the said disclosure was made by the Noticee on March 27,2014 after the receipt of the SCN. I am of the view that when mandatory time period is stipulated for doing a particular activity, completion of the same after that period would constitute default in compliance and not delay. Timeliness is the essence of disclosure and delayed disclosure would serve no purpose at all. 4. However, the notice, while admitting the lapse on his part, has contended that the information required through the disclosure under regulation 7(1) read with regulation 7(2) of SAST Regulations, 1997 was already known to the investors when he made the public announcement for acquisition of shares of EEL on September 21, 2010 and shareholders were also given an exit opportunity through open offer. I note that public announcement was made by the notice on September 21, 2010 much before the date of acquisition, whereas the obligation of disclosure under regulation 7(1) is to be performed post acquisition of shares. I am, therefore, of the view that the said public announcement cannot be accepted as substitute for discharge of disclosure obligation by the notice under regulation 7(1) read with regulation 7(2) of SAST Regulations, 1997. It is needless to state here that the disclosure obligation has to be discharged only in the manner prescribed under the law. 5. In this context, I would also like to rely on the judgment of Hon’ble SAT in Premchand Shah and Others V. SEBI (Appeal no. 108 of 2010 decided on February 21, 2011), wherein it was observed that “….. When law prescribes a manner in which a thing is to be done, it must be done only in that manner or not at all. Both sets of regulations prescribe formats in which the disclosures are to be made and those are then put out for the information of the general public through special window(s) of the stock exchange which did not happen in this case. The fact that non disclosure has been made penal makes it clear that the provisions of regulation 7(1A) of the takeover code and regulations 13(3) and 13(4) of the insider regulations are mandatory in nature. Non disclosure of the information in Printed from counselvise.com ITA No. 502/JPR/2025 Renu Agarwal, Jaipur. 12 the prescribed manner deprived the investing public of the information which is required to be available with them when they take an informed decision while making investments.” 6. Noticee has further contended that on being appointed as additional director and managing director of the company on January 15, 2011, he made a disclosure in respect of acquisition of 72.05% shares to the company in compliance of regulation 13(2) of SEBI PIT regulations. Thereafter, the company had made proper disclosure to BSE under regulation 13(6) of SEBI PIT Regulations on January 17, 2011 and it showed that the information required to be disclosed under regulation 7(1) of SEBI takeover regulations in respect of actual acquisitions of shares on January 15, 2011 was disclosed to BSE and was very well in public domain on January 17, 2011. In this regard, I note that the disclosures requirement under PIT regulations, 1992 and SAST regulations 1997 are independent of each other and the disclosure made under PIT Regulations, 1992 does not absolve the person from making the relevant disclosure under the SAST Regulations. Therefore, the argument of the Noticee that it had made the disclosure under PIT Regulations, 1992 is also without merit. 7. In this context, I would like to rely on the judgment of Hon’ble Securities Appellate Tribunal (SAT) in Bindal Synthetics Private Limited V. SEBI (Appeal no. 75 of 2014 decided on June 09,2014), wherein it was observed that “ ……fact that the appellant had made disclosures under PIT Regulations, 1992 does not absolve appellants obligation to make disclosure under regulation 7(1A) of SAST Regulations, 1997.” 8. Further, referring to the judgment of Hon’ble SAT in the matter of ‘Vitro commodities Private Limited vs. SEBI’, Noticee submitted that such compliance of regulation 13(2) be treated as sufficient compliance and delay of filing disclosure under regulation 7(1) of SEBI Takeover regulations be condoned. I am of the view that the reliance placed by the Noticee on the afore-mentioned case does not support his case as in the referred case the non-disclosure by the appellant occurred mostly by not as active action by appellant but as a result of bonus shares, shares allotted due to amalgamation and again by issue of bonus shares. However, in the instant matter, Noticee has admittedly indulged in the transaction of acquisition of shares of EEL above the benchmark limit specified under regulation 7(1) of SAST Regulations, 1997. 9. Noticee has further contended that the scrip of the company was infrequently traded at that particular point of time and that no Printed from counselvise.com ITA No. 502/JPR/2025 Renu Agarwal, Jaipur. 13 disproportionate gain or unfair advantage has been made by him nor any loss has been caused to any investor or group of investor as a result of default. In this context, I would like to rely on the judgment of Hon’ble SAT in Ashok Jain V. SEBI (Appeal no. 79 of 2014 decided on June 09, 2014), wherein it was observed that “ …..Under SAST Regulations, 1997 as also SAST Regulations, 2011 disclosures are liable to be made within specified days irrespective of the scrip being traded on the Exchange or not. Similarly, disclosures have to be made irrespective of whether investors have suffered any loss or not on account of non disclosure within the time stipulated under those regulations.” 10. In view of the above, I find that the Noticee did not make the requisite disclosure regarding the acquisition of 72.02% of the share capital of EEL within the time specified therefor and thereby has violated regulation 7(1) read with regulation 7(2) of SAST Regulations, 1997. (b) Does the non-compliance, if any, attract monetary penalty under section 15A(b) of SEBI Act ? 11. By not making the disclosures on time, the Noticee failed to comply with its statutory obligation. The timely disclosure is mandated for the benefit of the investors at large. There can be no dispute that compliance of regulations is mandatory and it is duty of SEBI to enforce compliance of these regulations. The Hon’ble Supreme Court of India in the matter of Chairman, SEBI v. Shriram Mutual Fund {[2006] 5 SCC 361} held that “In our view, the penalty is attracted as soon as contravention of the statutory obligations as contemplated by the Act is established and, therefore, the intention of the parties committing such violation becomes immaterial. …………. Hence, we are of the view that once the contravention is established, then the penalty has to follow and only the quantum of penalty is discretionary.” 12. In this context, I would also like to rely on following observation of Hon’ble Securities Appellate Tribunal in the case of Mr. Ranjan Verghese vs. SEBI (Appeal No. 152 of 2009 decided on September 22, 2009) “……Failure to furnish the necessary information by way of disclosures under the Takeover Code entitles the adjudicating officer to impose a penalty of Rs. 1 lac for each day during which such failure continues or Rs. 1 crore whichever is less. The law was amended in October, 2002 requiring the adjudicating officer to impose stringent penalties on the defaulters so that they act as deterrent for other market players. What is contended by the learned counsel for the appellant is that the disclosures which were required to be made by the appellants were already in public domain and, therefore, no damage was caused either to the market or to any investor and that this was not a case where the adjudicating officer should have levied a penalty and, in any case, it is a fit case where it Printed from counselvise.com ITA No. 502/JPR/2025 Renu Agarwal, Jaipur. 14 should be considerably reduced. We are unable to accept this contention. Once it is established that the mandatory provisions of the Takeover Code were violated, the penalty must follow.” 13. In this context, I would also like to rely on following observation of Hon’ble Securities Appellate Tribunal in the case of Mrs. Komal Nahata vs. SEBI (Appeal No. 5 of 2014 decided on January 27, 2014) “Argument that no investor has suffered on account of non disclosure land that the AO has not considered the mitigating factors set out under Section 15J of SEBI Act, 1992 is without any merit because firstly penalty for non compliance of SAST Regulations, 1997 and PIT Regulations, 1992 is not dependent upon the investors actually suffering on account of lsuch non disclosure. Secondly, penalty under Section 15A(b) for non compliance of the regulation framed by SEBI is Rs. 1 lac for each day during which such failure continues or 1 crore rupees whichever is less.” 14. I have considered other contentions raised by the Noticee in his reply and find no merit in them in the context of the facts and circumstances of the matter in hand. As the violation of the statutory obligation under regulation 7(1) read with regulation 7(2) of SAST Regulations, 1997 has been established. I hold that the Noticee is liable for monetary penalty under section15A(b) of SEBI Act, which reads as under :- “15A. Penalty for failure to furnish information, return, etc. – If any person, who is required under this Act or any rules or regulations made there under, - a) ……… b) To file any return or furnish any information, books or other documents within the time specified therefor in the regulations, fails to file return or furnish the same within the time specified therefor in the regulations, he shall be liable to a penalty of one lakh rupees for leach day during which such failure continues or one crore rupees, whichever is less” c) If so, what would be the monetary penalty that can be imposed taking into consideration the factors mentioned in section 15J of SEBI Act ? 15. While determining the quantum of penalty under section 15A(b), it is important to consider the factors stipulated in section 15J of SEBI Act, which reads as under :- “ 15J – Factors to be taken into account by the adjudicating officer. While adjudging quantum of penalty under section 15-I, the adjudicating officer shall have due regard to the following factors, namely :- Printed from counselvise.com ITA No. 502/JPR/2025 Renu Agarwal, Jaipur. 15 (a) The amount of disproportionate gain or unfair advantage, wherever quantifiable, made as a result of the default; (b) The amount of loss caused to an investor or group of investors as a result of the default; (c) The repetitive nature of the default.” 16. From the material available on record, the amount of disproportionate gain or unfair advantage to the Noticee or loss caused to the investors as a result of the default is not quantifiable. Further, there is no material on record to indicate that such default was repetitive. However, it is pertinent to mention here that our entire securities market stands on disclosure based regime and accurate and timely disclosures are fundamental in maintaining the integrity of the securities market. Correct and timely disclosures are also an essential part of the proper functioning of the securities market and failure to do so results in preventing investors from taking well-informed decision. ORDER 17. After taking into consideration all the facts and circumstances of the case, I, in exercise of the powers conferred upon me under Section151(2) of the SEBI Act read with Rule 5 of the Adjudication Rules, hereby impose a penalty of Rs. 10,00,000/- (Rupees Ten Lakh only) under Section 15A(b) for violation of regulations 7(1) read with regulation 7(2) of SAST Regulations, 1997; read with Regulation 35 of SAST Regulations, 2011 by the notice by the notice i.e. Sanjay Salunkhe, I am of the view that the penalty imposed is commensurate with the violation committed by the Noticee. 18. The Noticee shall pay the said amount of penalty by way of demand draft in favour of “SEBI – Penalties Remittable to Government of India”, payable at Mumbai, within 45 days of receipt of this order. The said demand draft should be forwarded to The Division Chief (CFD-DCR), Securities and Exchange Board of India, SEBI Bhavan, Plot No. C-4, “G” Block, Bandra Kurla Complex, Bandra (E), Mumbai – 400 051. 19. In terms of rule 6 of the Rules, copies of this order are sent to the Noticee and also to the Securities and Exchange Board of India. Date : June 24, 2014 A.Sunil Kumar Place : Mumbai Adjudicating Officer.” Printed from counselvise.com ITA No. 502/JPR/2025 Renu Agarwal, Jaipur. 16 6. In continuation of above written submissions, as per direction of the Bench, the ld. DR vide letter dated 15.07.2025 further submitted written submission as under : “ It is respectfully submitted that paragraphs 4 and 5 of the assessment order clearly demonstrate the factual basis of the Assessing Officer’s finding that the transactions in the shares of Eins Edutech were not genuine. The relevant portion is reproduced below for ready reference : “ Since some aspects of purchase & sale of the alleged shares, particularly the genuineness of the transaction, need to be examined, the A/R of the assessee filed the copy of contract notes, details, and calculation of capital gain for the F.Y. 2014- 15. From the details and calculation of income sheet of the assessee for the financial year 2014-15, it came to notice that the assessee has shown Rs. 3,51,429/- as Short Term Capital Gain (with STT) & Rs. 1,30,266/- as Short Term Capital Loss (without STT), and after adjusting Short Term Capital Gain becomes to Rs. 2,21,163/-. From the details of stock summary of quoted shares from 01/04/2014 to 31/03/2015, it is seen that assessee has made transactions of shares in the scrip of EINS EDUTECH (Code: 511064), which is marked as PENNY STOCK.” “From the ledger of EINS Edutech Limited as furnished by the A/R of the assessee, it came to notice that assessee has sold shares of Rs.10,17,964.72 as against quantity of 18,955 against purchase of Rs. 18,38,667.01 (quantity of 18,955) and short- term profit becomes to Rs. 1,79,297.71 and the script of Eins Edutech renames as Aplaya Creations in stock market.” These facts reinforce the Revenue’s position that :  The scrip involved is a known penny stock, renamed from Eins Edutech to Aplaya Creations.  The transactions resulted in an abnormal gain despite negligible fundamentals.  The DDIT (Investigation) report and SEBI findings squarely apply to this pattern of trades. The Revenue respectfully submits that these facts, extracted directly from the assessment record, further strengthen the case for confirming the addition made by the Assessing Officer under Section 68/69C. Printed from counselvise.com ITA No. 502/JPR/2025 Renu Agarwal, Jaipur. 17 Respectfully submitted on behalf of the Revenue.” 7. On the contrary, the ld. AR of the assessee submitted that the AO had taken the entire sales consideration without taking into account the purchase price of such shares thereby the order passed by the AO was merely based on presumptions without any evidence, and the addition made is not justified. The ld. AR, in support of his contention, submitted written submissions which are being reproduced hereunder :- “ 1. The assessee being engaged in trading and investments in Stock Market had invested in the shares of various companies including “EINS Edutech Ltd.” listed on Bombay Stock Exchange and this script was identified as deceptive. The details of transactions in the shares of “EINS Edutech Ltd.” are as under : Date of Purchase Quantit y Rate Total Amount Date of Sale Quantity Rate Total amount 18.11.14 350 334.98 1,17,242.49 20.11.14 900 347,06 3,12,357.69 21.11.14 600 351.63 2,10,977.93 25.11.14 125 361.61 45,200.91 27.11.14 1,725 361.11 6,22,918.85 28.11.14 1,555 385.24 5,99,044.45 13.03.15 1,555 482.80 7,50,800.21 Total 12,39,622.56 Total 14,18,919.9 7 Short Term Capital Gain : Rs. 1,79,297/- These transactions had been executed from account payee cheque and STT was also been charged on these transactions. The assessee being a small investor had been figuring out opportunities to invest by studying various charts, market trends, etc. Observing such trends the assessee invested in shares of “EINS Edutech Ltd.” and later on sold such shares after booking the expected profit and considering that the share prices would not raise further as reflected by market charts. The sale of shares resulted in short term capital gain and had been properly declared as Short Term Capital Gain while filing return of income. From the table above, it can be clearly seen that price of shares rise from Rs. 334.98 to Rs. 361.11, within a period of 9 days, in terms of Printed from counselvise.com ITA No. 502/JPR/2025 Renu Agarwal, Jaipur. 18 percentage the rise is 7.8% which seems to be due to general market operations. Now, it should be taken into consideration that merely 7.8% rise in stock prices within a period of 9 days cannot be considered as price rigging. Even the upper circuit and lower circuit limits for Stock prices ranges 5% to 20% on day basis, then how the rise of 7.8% within 9 days can be called as price rigging. Although, at that time the assessee was not aware of these types of activities even prevail in stock market. The charts are showing movement in the script and the assessee had just enter in the market stream to earn profits. Further after selling such shares, the assessee repurchased shares of same company (at rate of Rs. 385.24) as the charts/trends showed upward movement on this script, and after earning expected returns assessee sold these shares (at rate of Rs. 482.80), and earn returns of 25.32% within a period of 3 months and 17 days, which is again a justified percentage of return which can be earned from genuine stock market operations in a considerable time period. 2. These transactions are duly reflected in the Demat Statement and STT had also been charged on these transactions. The documentary evidence i.e. Bills, Contract Notes, Demat statements and bank statements, etc. are already submitted to your good-self and are reattached to prove the genuineness of the transaction. All the transactions were made through account payee cheque only and duly reflected in the books of accounts, and the same can be verified through bank statements of the assessee. 3. While making the calculations the ld. AO had also miscalculated the sale value of these share, the actual sale value (duly reflected in Contract Notes/Account ledger from share broker) was Rs. 14,18,920/- and the addition being made by Ld. AO on account of sales consideration is Rs. 20,17,964/-, we are unable to find how the ld. AO had considered the value Sales consideration of Rs. 20,17,964/-. It is further submitted that the ld. AO had made the addition of complete amount of Sales consideration (as calculated by ld. AO) i.e. Rs. 20,17,974/- without taking into account that the actual Short Term Capital Gain resulting from these transactions was Rs. 1,79,297/- only (as calculated in table above). The AO taxed the whole sales consideration which is against natural justice. It is a settled law that if the transaction is bogus then only the profit can be taxed not the whole sale value, reliance can be placed on the following cases :- Printed from counselvise.com ITA No. 502/JPR/2025 Renu Agarwal, Jaipur. 19 (i) In the case of M/s. Shivhare Associates, Gwalior vs. ACIT, Range-1, Gwalior (16 May, 2018), the court held that “ in such cases, a just, fair and reasonable net profit rate is to be applied on the basis of past history of the trading result of the assessee or the comparable case of the same line of business”, “As stated above that while making best judgment one should have reasonable nexus to the available material and circumstances. In the case under consideration both AO and CIT Appeal have ignored the past history of the assessee and comparable cases” and “Therefore, our observation in ITA No. 47/Agr/2014 and ITA No. 48/Agr/2014 are squarely applicable to the other cross appeal, hence, in accordance therewith in this appeal also the grievance of the assessee is found justified and accordingly, the AO is directed to apply N.P. rate of 2.7% on the estimated sales after deducting interest and salary to partners subject to the minimum return income. In the result, appeals of the assessee are partly allowed and those of the department are dismissed.” (ii) Syed Rizwan Murtza Lucknow vs Department of Income Tax : In this the ITAT held that “Having given a thoughtful consideration to the rival submissions, we find that during the course of survey, the assessee has offered an amount of “16 lakhs for taxation spread over a period of six years. This additional income was offered on account of profit earned on undisclosed sales. The assessing Officer has no other evidence except the statement of the assessee to estimate any other income. While adjudicating the appeal, the ld. CIT (A) has carefully examined issue and has rightly held that the undisclosed sales cannot be added to the income of the assessee; only gross profit can be added. He has also taken into account the additional income declared by the assessee. We, therefore, find no infirmity in the order of the ld. CIT (A) and we confirm the same.” Even when the assessee (Syed Rizwan Murtza) in this case was proved to be in default of undisclosed income the court had applied the gross profit rate to the undisclosed sales, then in this case (Renu Agarwal) all the transactions had been executed in transparent manner and Capital gain was also declared correctly in ITR. Printed from counselvise.com ITA No. 502/JPR/2025 Renu Agarwal, Jaipur. 20 Considering the above cases, it is to further submit that the STCG from the above share script was Rs. 1,79,297/- only, and the same was already declared for tax purposes in the ITR. The assessee has neither claimed any exemption of tax u/s 10(38) (LTCG exemption) nor claimed any set off. It also shows that the assessee was having bona- fide transaction only. 4. It is to submit that, transactions carried out by assessee can’t be presumed as fraudulent on the basis of involvement of company’s directors in suspicious/deceptive activities, and the addition can’t be held justified without any cogent evidence in support of such addition. The addition cannot be made on surmises, presumptions, suspicion and based on the activities of directors of such company where assessee holds some shares for a short period of time and same has been declared correctly in Return of income. The reliance can also be placed on the following case laws :- (i) PCIT-3, Calcutta vs. Rungta Properties Pvt. Ltd. 106 (Calcutta) [2017] : In this case the Court held that “ As a matter of fact the AO doubted the integrity of the broker or the manner in which the broker operation as per the statement of one of the directors of the broker firm and also AO observed that assessee had not furnished any explanation in respect of the intention of showing trading of shares only in three penny stocks. AO relied the loss of Rs. 25,30,396/- only on the basis of information submitted by the Stock fictitious. AO has also not doubted the genuineness of the documents placed on record by the assessee. AO’s observation and conclusion are merely based on the information representative. Therefore, on such basis no disallowance can be made and accordingly we find no infirmity in the order of ld. CIT (A), who has rightly allowed the claim of assessee. Thus ground No. 1 of the revenue is dismissed.” This case specifically states that no allegations can be placed on a person only on the basis of information received from others sources, further in the case of assessee, the assessee was not having any tax benefit from the transaction. (ii) Kiran Kothari Huf, Kolkata vs.ITO, Ward 35(3), Kolkata 15 November, 2017 : The court held that “ld AR that the AO and CIT (A) was not justified in rejecting the claim of the assessee on the basis of theory of surrounding Printed from counselvise.com ITA No. 502/JPR/2025 Renu Agarwal, Jaipur. 21 circumstance, human conduct and preponderance of probability without bringing on record any relevant legally admissible evidence against the assessee. For the said proposition we rely on the judgment of the Special Bench of Mumbai Bench in the case of GTC Industries Ltd. (supra). The various facets of the contention of the AO, to rope in the assessee for drawing adverse inferences which remain unproved based on the Kiran Kothari HUF AY 2013-14 evidence available on record are not reiterated for the sake of brevity. The AO has merely carved out certain features/modus operandi of companies indulging in practices not sanctioned bylaw and as mentioned in such report. However, we note that neither any investigation was carried out against the assessee nor against the brokers to whom the assessee dealt with the purchase and sale of shares in question. Thus the AO has failed to bring on record any material contained in the purported reports which are having so called adverse impact on the assessee. We find that the transactions of sale of shares by the assessee was duly backed up by material/evidence including contract notes, demand statement, bank account reflecting transactions, the stock brokers have confirmed the transaction (pages 24-25 of the paper book), the shares having been sold on the online platform of the stock exchange. In absence of any evidence to back the conclusion of AO/CIT (A), it cannot be said that merely because the stock price moved sharply, the assessee was to be blamed for bogus transitions.” In this case the appeal of the revenue was dismissed being unsupported by documentary evidences and merely based on presumptions and modus operandi of the company where assessee was a shareholder. (iii) CIT Vs. Smt. Sumitra Devi in ITA 54/2012 : In this case the Rajasthan High Court held that “ True it is that several suspicious circumstances were indicated by the AO but then, the findings as ultimately recorded by him had been based more on presumptions rather than on cogent proof. As found concurrently by the CIT (A) and the ITAT, the AO had failed to show that the material documents placed on record by the assessee like broker’s note, contract note, relevant extract of cash book, copies of share certificate, de-mat statement etc. were false, fabricated or fictitious. Printed from counselvise.com ITA No. 502/JPR/2025 Renu Agarwal, Jaipur. 22 The appellate authorities have rightly observed that the facts as noticed by the AO, like the notice under Section 136 to the company having been returned unserved; delayed payment to the brokers; and de-materialisation of shares just before the sale would lead to suspicion and call for detailed examination and verification but then, for these facts alone, the transaction could not be rejected altogether, particularly in absence of any cogent evidence to the contrary.” As all the contract notes, demat statement has been duly submitted and the payment was through account payee cheque, copy of bank statement has also been submitted and the resulting gain from transactions has been duly included in taxable income of the assessee the same can’t be considered as fraudulent on the part of assessee. (iv) High Court of Gujarat in case of Commissioner of Income- tax-I Vs. Maheshchandra G. Vakil [2013] (Gujarat) held that, Where assessee proved genuineness of share transactions by contract notes for sale and purchase, bank statement of broker, demat account showing transfer in and out of shares, as also abstract of transactions furnished by stock exchange, Assessing Officer was not justified in treating capital gain arising from sale of shares as unexplained cash credit. (v) High Court of Gujarat in case of Commissioner of Income-tax-I Vs. Himani M. Vakil (Gujarat) held that, Where assessee proved genuineness of share transactions by bringing on record contract notes for sale and purchase, bank statement of broker and demat account showing transfer in and out of shares, Assessing Officer was not justified in bringing to tax capital gain arising from sale of shares as unexplained cash credit. From case laws (iv) and (v) it is to placed that the addition ld. AO made in this case is totally unjustified and shall be deleted. The facts of the case cited above are having the same facts as in the case of assessee i.e. the proceedings were carried out without documentary evidences, merely based on presumptions, and considering the modus-operandi of companies and its directors, and the judgment were decided Printed from counselvise.com ITA No. 502/JPR/2025 Renu Agarwal, Jaipur. 23 on facts established and supported by documentary evidences submitted by the assessee. 5. Further it is to provide, that as quoted in Assessment Order such “ Long Term Capital Gain” or “Capital Loss” would either inflate the share price and being exempted by claiming exemption nor in case of loss would be set off from Profits and reduce the Tax Liability of the assessee, however in this case the gains arising from stocks were Short Term in nature and form the part of total income of the assessee, further the assessee hadn’t claimed any Long term capital gain u/s 10(38) of Income Tax Act, 1961, during the year under consideration. The entire sales consideration has been considered as addition to total income of assessee, which is totally unjustified and against natural justice, as the assessee has not been benefited in any manner (in respect of tax benefits) by executing these transactions. 6. As referred in the assessment order that the activities of Director were to artificially effect the share prices in the market, in response to this it is to submit that the activities of directors are not available in the open market, and this activity in general is a sophisticatedly planned activity and the same remains confidential among stock influencers. Being a normal investor assessee observing the market trends invested in these shares and as soon as she earned her expected returns, booked the gain. Being a small investor, the assessee was more concerned of making profits instead of analyzing financials of the company and finding out whether the entity having significant operations or fixed assets. In fact, the same can be observed through IPO’s of various renowned companies where shares of companies are issued and listed at a higher price considering its operations, profitability and scope of expansion. 7. It is to be emphasize that any shareholder holding insignificant number of shares cannot be punished/penalized for the unfair practices of director of such company, as the small investors are more focused on making the profits and not on what type of trade practices its directors are executing. Prayer : As per above submissions, it is clear that there is no intention of the assessee for rigging the prices of shares of Eins Edutech Limited, neither assessee had got any tax benefit from such transaction, and the ld. AO had made the entire sales consideration without taking into account the purchase price of such shares, thus the order passed by AO was merely based on presumptions without any evidence and therefore rightly deleted by CIT (A)-NFAC.” Printed from counselvise.com ITA No. 502/JPR/2025 Renu Agarwal, Jaipur. 24 8. The ld. AR of the assessee has further submitted written submission as under :- “ With due respect, we are submitting herewith the detailed statement of purchase and sale transactions in relation to the equity shares under consideration. It is to bring to your kind notice that 1,555 shares were originally purchased on 28/11/2014, which were subsequently split in the ratio of 1:10 on 12/032025, resulting in 15,550 shares post-split. The actual total sale value of the said share script was Rs. 14,18,920/-. Due to splitting of shares, a stock Journal was passed in the books of account of Rs. 5,99,044/-. The AO has wrongly considered this Stock Journal as sales and assessed the whole value of Rs. 20,17,964/- as unexplained cash credit u/s 68 of the Act. All the contract notes of purchase and sale have already been submitted before the Hon’ble bench. The AO neither examined the contract notes nor made any independent enquiry of the said share script and not allowed the purchase cost which was paid through exchange only. As the whole purchase and sale was through recognized exchange only and the short-term capital gain earned on the said script was properly declared in return. Therefore, we request your kind consideration of the above facts and circumstances, and humbly seek that the matter be viewed accordingly to avoid any misinterpretation.” Printed from counselvise.com ITA No. 502/JPR/2025 Renu Agarwal, Jaipur. 25 9. The ld. AR furnished the following documents by way of Paper Book :- PAPER BOOK Sr. No. Particulars Page No. 1. ITR Acknowledgement AY 2015-16 1 2. ITR Computation 2 3. Stock statement 3-4 4. Abstract of Broker’s Financial Statement 5-9 5. Contract Notes 10-16 6. Bank statement 17-20 10. We have heard the rival submissions, perused the material on record and gone through the orders of the lower authorities. Having considered the material on record, we find that the AO made the addition drawing inference that the entire sale transactions of the assessee in the stocks of Eins Edutech are bogus without bringing any cogent evidences contrary to the documentary evidences i.e. Bills, Contract Notes, Demat statements and bank statements etc. submitted by the assessee. The AO has not disputed that the entire purchase and sales transactions were carried through recognized Stock Exchanges, payments have been made through account payee cheque and STT has been charged on these transactions and the same were duly reflected in the books of account of the assessee. It is noted that the AO has doubted the transactions considering the price rigging information and accordingly initiated the proceedings on the basis of report of the Investigation Wing of the department relating to misuse of the Stock Exchange platform for evading Printed from counselvise.com ITA No. 502/JPR/2025 Renu Agarwal, Jaipur. 26 or avoiding legitimate taxes. The assessee submitted that being a small investor, investments have been made in the shares after studying various charts, market trends etc. and later on sold such shares after booking the expected profit and also paid the tax on the profit. Based on the evidence placed on record, the Bench noted that the assessee has purchased the stock of ‘’EINS Edutech Ltd. by an account payee cheque supported by a online contract note for an amount of Rs.12,39,622.56 and thereby sold those shares for an amount of Rs.14,18,919.95 and thereby offered the gain of Rs.1,79,297/- as short term capital gain. This gain is part of overall short term capital gain of Rs. 3,51,428/- offered by the assessee in computation of income filed as per computation of income. This fact has not been disputed by Revenue. Now coming to the amount of addition of Rs.20,17,964/- made by the AO, the Bench noted that there was action of split of shares for which to meet the quantity reconciliation, assessee had shown sale and purchase of Rs.5,99,045/- in tally records so as to record the correct quantity and their ld. AO added that Rs.5,99,045/- with sale consideration of Rs.14,18,919/- and thereby added a sum of Rs.20,17,964/- which cannot be added as income of the assessee as ld AO already taxed the Short Term Capital Gain. Considering the above factual aspects as discussed above, we see no reasons to deviate in the findings of the ld.CIT(A) and therefore, the appeal of the Revenue fails as dismissed. Printed from counselvise.com ITA No. 502/JPR/2025 Renu Agarwal, Jaipur. 27 In the result, appeal of the Revenue is dismissed. Order pronounced in the open Court on 30/09/2025. Sd/- Sd/- ¼ Mk0 ,l- lhrky{eh ½ ¼ jkBksM deys'k t;UrHkkbZ ½ (Dr. S. Seethalakshmi) (Rathod Kamlesh Jayantbhai) U;kf;d lnL;@Judicial Member ys[kk lnL;@Accountant Member Tk;iqj@Jaipur fnukad@Dated:- 30/09/2025 *Santosh vkns'k dh izfrfyfi vxzsf’kr@Copy of the order forwarded to: 1. vihykFkhZ@The Appellant- ITO, Ward-4(1), jaipur. 2. izR;FkhZ@ The Respondent- Renu Agarwal, Jaipur. 2. vk;dj vk;qDr@ CIT 4. vk;dj vk;qDr@ CIT(A) 5. foHkkxh; izfrfuf/k] vk;dj vihyh; vf/kdj.k] t;iqj@DR, ITAT, Jaipur. 6. xkMZ QkbZy@ Guard File { ITA No. 502/JPR/2025 } vkns'kkuqlkj@ By order lgk;d iathdkj@Asst. Registrar Printed from counselvise.com "