JAYA SINGH,NEW DELHI V. ACIT SPL. RANGE-03, NEW DELHI

ITA 4403/DEL/2019

AI Insights

The case revolves around the appeal by Jaya Singh against the order of the Commissioner of Income Tax (Appeals)-34, New Delhi, which sustained the additions made by the Assessing Officer regarding long-term capital gains claimed as exempt under section 10(38) of the Income Tax Act, 1961. The gains were from the sale of shares of M/s. Goldline International Finvest Ltd., which were alleged to be part of a 'bogus LTCG scheme'. The Assessing Officer had treated these gains as unexplained income, citing suspicious transactions and the nature of the shares as 'penny stocks'. The Tribunal, after examining the submissions, evidence, and relevant case laws, concluded that the assessee had provided sufficient documentation to substantiate the genuineness of the transactions, including bank statements, contract notes, and demat account statements. The Tribunal also noted the lack of direct evidence linking the assessee to any fraudulent activities or manipulation of share prices.

• Counselvise Citation: [2026] 140 COUNSELVISE.COM (IT) 840126 (ITAT-DELHI)
• Duration Of Justice: 6 year(s) 9 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-02-2026
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: F
• Assessment Year: 2015-2016
• Appeal Filed On: 14-05-2019
• Other Referred Cases: Krishna Devi vs. Income Tax Department, Archit Gupta vs. Income Tax Department, Pr. CIT vs. Karuna Garg, Parasben Kasturchand Kochar vs. Income Tax Department, Pr. CIT vs. Ziauddin A Siddique
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: HARPREET KAUR HANSRA
• Assessee Lawyers: P.K. JAIN; AKSHIT JAIN; SUBMITTING RECORDS OF
• Keywords: Question of law; Cost of acquisition; Capital Gains; Accommodation entries; Earning of tax free income; Share purchase agreement; Penny stocks; Bogus
• Section: 142(1); 68; 69C

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES ‘F’: NEW DELHI. BEFORE SHRI S. RIFAUR RAHMAN, ACCOUNTANT MEMBER AND SHRI VIMAL KUMAR, JUDICIAL MEMBER ITA No.4403/Del/2019 (Assessment Year: 2015-16) JAYA SINGH vs. ACIT, House No. 204, Special Range-3, Tower No. 12, New Delhi CWG Village Near Akshardham, New Delhi Delhi-110092 PAN: AALPS1760Q (APPELLANT) (RESPONDENT) ASSESSEE BY: Shri P.K.Jain, CA & Sh. Akshit Jain, CA REVENUE BY: Ms. Harpreet Kaur Hansra, Sr. DR Date of Hearing: 20.01.2026 Date of Order : 27.02.2026 ORDER PER S. RIFAUR RAHMAN, A.M.: The Assessee has filed appeal against the order of the Learned Commissioner of Income Tax (Appeals)-34, New Delhi [“Ld. CIT(A)”, for short] dated 25.03.2019 for the Assessment Year 2015-16. 2. Brief facts of the case are that the assessee filed its return of income on 28.08.2015 declaring total income of Rs. 79,79,450/-. The return was processed u/s 143(1) of the Income Tax Act, 1961 (For short ‘the Act’). Printed from counselvise.com 2 ITA No.4403/Del/2019 Subsequently, the case was selected for scrutiny through CASS. Accordingly, notices u/s 143(2) and 142(1) of the Act were issued and served on the assessee. In response, the Ld. AR of the assessee attended from time to time and filed the relevant information as called for. 3. During the assessment proceedings, the Assessing Officer noticed that the assessee has claimed exemption u/s 10(38) of the Act to the extent of Rs. 4,62,18,791/- on account of long term capital gains from purchase and sale of shares of M/s. Goldline International Finvest Ltd. and observed that the reasons for scrutiny itself that there were suspicious sale transactions in shares. In order to ascertain the genuineness of the transactions, specific query was made vide order sheet entry dated 05.09.2017, the assessee was asked to give complete details of shares purchased and sold on which capital gains was claimed as exempted. In response, the assessee submitted as under: “The Shares bought and sold are of a listed company. Gold Line International Finvest Ltd. share is purchased on December 2012 and March 2013 and sold on various dates from May 2014 to September 2014 by cheques as mode of payment made and receipts. The shares are transfer in and out in demat account and the transactions are floated on the floor of BSE (Bombay Stock Exchange) i.e. recognized stock exchange through SEBI & BSE registered broker. Also please appreciate during this period BSE Sensex increased from 18568 as on 28/03/2012 to 27319.85 as on 08/09/2014, which justifying the capital gain. Gold Line International Finvest Ltd company is listed with BSE Printed from counselvise.com 3 ITA No.4403/Del/2019 with all permission and companies of SEBI, BSE and is being traded on stock exchange till now. Also, the circuit filter's are changed by stock exchange on daily basis. Thus, the stock is under monitor by SEBI, BSE and earlier no actions were taken by SEBI, BSE on this script. The abstract of share transactions is supported by contract notes for sale and purchase of shares, demat account statement showing transfer in and transfer out of shares. Also, please appreciate. Further, there are various instances when the shares prices fluctuate a lot Following are the examples of share price increase during the period of two to three years period: - i) Himachal Futuristic Communications Ltd. as on 20/10/1998 at Rs.26.20/-and as on 13/12/2000 at Rs.1572.60/-. ii) Motilal Oswal Financial Services Ltd. as on 31/01/2014 at Rs.80.90/- and as on 11/09/2017 at Rs.1293.10/-. iii) Apollo Tyres Ltd. as on 15/12/2013 at Rs.65.05 and as on 05/12/2016 at Rs.229.75/-.\" 4. After considering the above submissions, another letter was issued to the assessee vide letter dated 06.10.2017 and called for the detailed queries mentioned in the above letter which had ten queries. In response, the assessee has submitted as under: - “In reference to the captioned notice and on further requirements by your goodself and under the instructions from our client we have to submit as under. 1) Yes, the assessee has been regular in trading of shares and securities. 2) No, the assessee has not derived any Long Term Capital Gains in AY 2014-15, however there are sale and purchase transactions. 3) The shares of M/s Goldline International Finvest Ltd. were acquired through Preferential Allotment. Printed from counselvise.com 4 ITA No.4403/Del/2019 4) No, the assessee doesn't knows the directors of M/s Goldline International Finvest 5) The shares of the company were applied on recommended of various persons available in an investor meeting. M/s Goldline International Finvest Ltd. is engaged in the business of Investments along with advisory services in India and Abroad. A brief study of the Financials was made before investing in the shares. Kindly appreciate the assessee is well versed with investment portfolio, being an ex-banker and director finance in one of the public limited company. 6. The payment was made through account payee cheques. In support of this bank statement is attached for this period. 7. The assesssee has been dealing in shares of a long time and making profits and losses as per market conditions and the lump in share prices is as per the market conditions. The share is listed on Bombay Stock Exchange which is under the surveillance of SEBI and BSE on day to day basis. Gold Line International Finvest Ltd share is purchased on December 2012 and March 2013 and sold on various dates from May 2014 to September 2014 by cheques as mode of payment made and receipts. The shares are transfer in and out in demat account and the transactions are floated on the floor of BSE (Bombay Stock Exchange) i.e, recognized stock exchange through SEBI & BSE registered broker. Also please appreciate during this period BSE Sensex increased from 18568 as on 28/03/2012 to 27319.85 as on 08/09/2014, which justifying the capital gain. The abstract of share transactions is supported by contract notes for sale and purchase of shares, demat account statement showing transfer in and transfer out shares. Also, please appreciate. Further, there are various instances when the shares prices fluctuate a lot. Following are the examples of share price increase during the period of two to three years period: - 1) Himachal Futuristic Communications Ltd. as on 20/10/1998 at Rs.26.20 and as on 13/12/2000 at Rs. 1572.60/- ii) Motilal Oswal Financial Services Limited as on 31/01/2014 at Rs.80.90/- and as on 11/09/2017 at Rs. 1293.10/- Printed from counselvise.com 5 ITA No.4403/Del/2019 iii) Apollo Tyres Ltd. as on 15/12/2013 at Rs.65.05/- and as on 05/12/2016 at Rs.229.75/- 8) The share of M/s Goldline International Finvest Ltd. have been sold on a platform of BSE through member broker of Bombay Stock Exchange. 9) Kindly find the Broker's statement for 01.04.2014 to 18.06.2014 annexed herewith. 10) In respect of AIR transactions, kindly appreciate the fact that all the transactions of purchase of investments has been done through account payee cheques and the same have been reflected in the bank account of the assessee and the assessee's minor daughter as reflected in AIR. Kindly find the same annexed herewith,\" 5. The Assessing Officer considering the fact that the transaction of M/s. Goldline International Finvest Ltd. were under the Income Tax Department and further investigations, after getting inputs from investigation reports, the Assessing Officer further issued letter dated 18.12.2017 to provide further details on essential investment and observations of Investigation Wing relating to financials of M/s. Goldline International Finvest Ltd. In response, the assessee is submitted as under: - \"In reference to the captioned notice and on further requirements by your good self and under the instructions from our client we have to submit as under:- 1) Initial payment of Rs. 10 lakhs for purchase of investment has been made through account payee cheques which has already being submitted vide our letter dated 07.12.2017. Again, please find enclosed the bank statement copies, evidencing that the payment has been made through account payee cheques no. Printed from counselvise.com 6 ITA No.4403/Del/2019 233363 and cheque no.233395 of Rs. 5.00 lakhs each as appearing in the bank statement herewith as per Annexure A 2) As per the facts of the case, the purchase and sale transactions are supported and evidenced by Bills, contract Notes, Demat statements and bank statements etc., which is again submitted herewith in Annexure - B, the same could not be treated as bogus simply on the basis of some reports of the Investigation Wing and/or the orders of SEBI and/or the statements of third parties. In support of the aforesaid submissions, the Id AR, in addition to the aforesaid judgements, has referred to and relied on the following cases:-” 6. The assessee relied of various case laws and further, with regard to report from Investigation Wing, the assessee has submitted as under: - “a) That number of companies listed at BSE is about 5000 and more than 1600 companies are listed at NSE. The number of investors, investing in shares, debentures, mutual fund is more than 2 crores. That listing permission is being given by the BSE, NSE and SEBI after due diligence only i.e. after verifying the net worth of the company, directors and their addresses also. Moreover, any change in address of company and directors is informed to NSE, BSE and SEBI time to time by the company. b) That increase / decrease in price of share listed is closely monitor by exchange on minute to minute and daily basis accordingly stock circuit is being changed and stock is being transferred from normal trading to trade-to-trade trading. c) That reason for huge increase in price of share should be asked from BSE authorities. I shall be highly thankful if a letter is written to BSE authorities asking them the following question. 1. Whether at the time of giving permission for listing due diligence is being taken care by you or not. II. Whether increase or decrease in price of share is closely monitor by you or not.” Printed from counselvise.com 7 ITA No.4403/Del/2019 7. After considering the detailed submissions of the assessee, the Assessing officer reproduced the modus operandi of bogus LTCG schemes, which the Ld. AO has reproduced at paras 8 to 8.7 of the order and after discussing the various issues relating to bogus shares and relevant case laws, he came to the conclusion that the exemption claimed u/s 10(38) of the Act was unexplained income of the assessee and accordingly added to the total income of the assessee. He, further added commission @2% for procuring bogus scripts to claim capital gains. 8. Aggrieved with the above order, the assessee preferred an appeal before the Ld. CIT(A)-34, New Delhi and filed the detailed submission before the Ld. CIT(A). After considering the above submissions, Ld. CIT(A) sustained the additions made by the Assessing officer. 9. Aggrieved with the above order, the assessee is in appeal before us raising following grounds of appeal: “1.1 On the facts and in the circumstances of the case and in law, the lower authorities erred in treating Long Term Capital Gains of 4,62,18,791/- on shares sold on Recognised Stock Exchange as unexplained income, merely on the basis of assumptions, presumption and surmises without bringing any material relevant to the appellant on record or giving justifiable explanation. and the reasons assigned for doing so are wrong and contrary to the facts and circumstances of the case, the provisions of Income Tax Act, 1961 and the Rules made there under. 1.2 On the facts and in the circumstances of the case and in law, the learned assessing officer erred in treating Long Term Capital Gains Printed from counselvise.com 8 ITA No.4403/Del/2019 arising from sale of shares as unexplained income by disregarding and without appreciating the following facts: i) that all the transactions were made through a recognized stock exchange and on which Securities Transaction Tax has been paid. ii) that copy of Demat Statement reflecting the delivery of the shares from the account of the Appellant was provided to prove the genuineness of the transaction. iii)that all payments made for acquiring shares and proceeds of the sale of the shares were through banking channel and no element of cash was involved. iv) the copy of Contract note for sale of shares were submitted during the assessment proceedings which have not been proved wrong or disputed. v) the appellant is well versed with investment portfolio, being an ex- banker and director finance in one public limited company. 1.3 On the facts and in the circumstances of the case and in law, the learned assessing officer erred in making the addition: i) without bringing any material evidence on record to justify the applicability of modus operandi discussed in the order to the facts of the appellant's case. ii) without any material evidence on record to show that the appellant was specifically named in the transaction relating to bogus LTCG Claims. iii) without providing the material possessed by the department and used by him for framing the assessment and making additions. iv) without giving opportunity to cross examine the parties who have given statement, if any against the assessee. v) without taking cognisance of the evidences given and submissions made by the appellant. vi) without even considering the amount of actual sale proceeds received by the appellant. which is wrong and contrary to the facts of the case, provisions of the Act and Income-tax Rules, 1962 (Rules) made thereunder; 1.4 Without prejudice to the above, the Id. AO disallowed Rs. 4,62,18,791/- as total exempt income claimed by the assessee which Printed from counselvise.com 9 ITA No.4403/Del/2019 includes Rs. 14,000/- as dividend income which is exempt u/s 10(34) of the Act and not doing so is wrong and contrary to the facts and circumstances of the case, the provisions of the Act and the Rules made there under. 2. On the facts and in the circumstances of the case and in law, the Id. Commissioner of Income Tax (Appeals) erred in enhancing the addition by Rs. 10,00,000/- on account of cost of acquisition claimed while computing Long Term Capital Gain u/s. 48 of the Act, and the reasons assigned for doing so are wrong and contrary to the facts and circumstances of the case, the provisions of Income Tax Act, 1961 and the Rules made there under. 3. On the facts and in the circumstances of the case and in law, the lower authorities erred in making addition of Rs.9,24,375/- u/s. 69C of the Act on account of commission paid for arranging the Long Term Capital Gain and the reasons assigned for doing so are wrong and contrary to the facts of the case, the provisions of Income Tax Act, 1961, and the Rules made there under. That the above grounds of appeal are without prejudice to each other. The appellant craves leave to add, amend, alter, modify and/or delete any of the above grounds of appeal on or before the date of hearing.” 10. At the time of hearing, the Ld. AR for the assessee submitted that the Assessing Officer observed that the assessee had claimed exemption u/s 10(38) of the Act by buying and selling of shares of M/s. Goldline International Finvest Ltd. treating the same as penny stock and heavily relied on the investigation report from investigation wing. He submitted that the assessing officer had not made any independent inquiry, in this regard, he submitted that the assessee had purchased the shares during the financial year 2012-13 and sold the same on 15.05.2014. He further Printed from counselvise.com 10 ITA No.4403/Del/2019 submitted that the third party investigation and their findings were not confronted to the assessee. He also submitted that the assessee had purchased and sold the same through stock exchange and also settlement through banking channel. Further, he submitted that the facts in the present case and in the case of Krishna Devi are exactly similar and in the case of Krishna Devi wherein Hon’ble Delhi High Court decided the issue in favour of the assessee. In this regard, he brought to our notice, the relevant findings of the Hon’ble High Court in the form of written submission and also heavily relied on the decision of the Co-ordinate Bench in the case of Archit Gupta, ITA No. 2624 & 2625/Del/2022, he placed the relevant order on record. Further, he submitted as under: “The assessment order or the CIT-A order does not contain even a whisper that the document submitted by the Appellant was not genuine/ were defective. It is submitted that the payments were received through banking channels and transaction were done through recognized stock exchange. The inflow of shares is reflected by way of physical share certificate and demat account. The shares were transferred through demat account and the assessee does not know the buyer. There is no evidence that assessee has paid cash in return of the receipt through cheque. In other words, there is no evidence that the cash was recycled. There is no evidence brought on record by the Ld. AO that either the assessee or his stock broker was involved in connived transactions in order to earn the exempt long term capital gains. The entire exercise of assessment had been made by the Id. AO only out of pure surmise and conjecture. The assessee has got only incidental benefit of price rise. The assessee invested in shares, which gave rise to capital gains, does not mean that the transaction is bogus, as all the Printed from counselvise.com 11 ITA No.4403/Del/2019 documents and evidences have been produced before assessing officer. The shares were sold on different dates through recognized stock exchange at quoted price. It is submitted that the Hon'ble Delhi High Court in the case of Pr. CIT vs. Karuna Garg in ITA No.477/2022 order dated 23rd November, 2022 as also held that an astronomical increase in the share prices of the company, in itself, is not a justifiable ground for holding the LTCG to be an accommodation entry. 2. Appellant is a regular investor and there is no adverse report of SEBI etc. against the appellant. During recording of the same, the appellant clearly stated that he is regular investor and making the investment in shares. Further in this regard the kind attention is invited to page no.3 of the Asstt order. This fact has not been denied by the Ld. AO while passing of the assessment order. The submissions are therefore that only because alleges a scrip to be a penny stock does not mean that actually that scrip is a penny stock as it is not the case that the appellant has invested only in this scrip. In this case, the appellant has made a genuine transaction of the aforesaid scrip and sold the same when the prices are high. Further, it is pertinent to state that in the entire assessment order and CIT (A) order, it is has not been stated that against the scrip to which the appellant has traded, there is some adverse report of the SEBI. Reliance is further placed on the decision of Parasben Kasturchand Kochar [2021] 130 taxmann.com 177 (SC), wherein the facts were that the assessee-individual was engaged in business of trading in shares claimed long term capital gains arising out of sale of shares as exemption under Section 10(38). The Assessing Officer denied claim and made certain additions into assessee's income on grounds that said gains were earned through bogus penny stock transactions and companies to whom sold shares belonged were bogus in nature. The Tribunal observing that assessee by submitting records of purchase bills, sale bills, demat statement, etc., had discharged his onus of establishing said transactions to be fair and transparent, same not being earned from bogus companies was eligible for exemption under Section 10(38) of the Act. The High court by impugned order held that no substantial question of law arose from Printed from counselvise.com 12 ITA No.4403/Del/2019 Tribunal's order. The SC dismissed the SLP against said impugned order.” 11. On the other hand, Ld. DR brought to our notice page 6 of the Assessing Order, wherein the financials of M/s. Goldline International Finvest Ltd. was analyzed by the Investigation Wing, and the report is exhaustive to show that the above said script was picked to manipulate the value of shares. Further, she brought to our notice SEBI order dated 28 June, 2023, wherein SEBI has investigated the scripts of M/s. Goldline International Finvest Ltd. and their Directors. Further, she brought to our notice another order dated 28 June, 2023, wherein a penalty was levied on the above script. She further brought to our notice Ld. CIT(A) has enhanced the disallowance and, hence, confirmed the disallowance of Rs. 10 lacs at para 4.27 of the order. Accordingly, she relied on the orders of lower authorities. 12. In rejoinder, the Ld. AR relied orders and stressed upon the findings of the Hon’ble High Court in the case of Krishna Devi. 13. Considered the rival submissions and material placed on record. The Assessing Officer observed that assessee had made huge profit out of this investment because of this, it makes the script as suspicious and penny stock. We cannot agree to the above observation, merely because of huge profit, it does not make the script a penny stock. Further, it is fact Printed from counselvise.com 13 ITA No.4403/Del/2019 on record that the financials of the company are not commensurate with the purchase and sale price in the market. The assessee has purchased the shares from the direct allotment, subsequently, sold the same through the stock exchange. However, there is no discrepancies in the documents filed by the assessee claiming the deductions u/s 10(38) of the Act. At the same time, even though the SEBI initiated proceedings against this script and also levied the penalty to them. However, there is no material with the Assessing Officer against the assessee that the assessee in any way connected with the dubious transactions relating to entry, price rigging or exit or any of the above operators. We can only presume that the assessee is one of the beneficiaries in these transactions merely as an investor who has entered in investment fray to make quick profit. Even the assessing officer has applied the presumptions and concept of human probabilities to make the additions without there being any material against the assessee. 14. Further, we observed that the issue under consideration is exactly similar to the facts in the case of Krishna Devi, wherein the Hon’ble High Court held as under: - “11. On a perusal of the record, it is easily discernible that in the instant case, the AO had proceeded predominantly on the basis of the analysis of the financials of M/s Gold Line International Finvest Limited. His conclusion and findings against the Respondent are chiefly on the strength of the astounding 4849.2% jump in share prices of the aforesaid company within a span of two years, which is not supported by the financials. On an analysis of the data obtained from the websites, the AO observes that the quantum leap in the share Printed from counselvise.com 14 ITA No.4403/Del/2019 price is not justified; the trade pattern of the aforesaid company did not move along with the sensex; and the financials of the company did not show any reason for the extraordinary performance of its stock. We have nothing averse to comment on the above analysis, but are concerned with the axiomatic conclusion drawn by the AO that the Respondent had entered into an agreement to convert unaccounted money by claiming fictitious LTCG, which is exempt under Section 10(38), in a pre-planned manner to evade taxes. The AO extensively relied upon the search and survey operations conducted by the Investigation Wing of the Income Tax Department in Kolkata, Delhi, Mumbai and Ahmedabad on penny stocks, which sets out the modus operandi adopted in the business of providing entries of bogus LTCG. However, the reliance placed on the report, without further corroboration on the basis of cogent material, does not justify his conclusion that the transaction is bogus, sham and nothing other than a racket of accommodation entries. We do notice that the AO made an attempt to delve into the question of infusion of Respondent’s unaccounted money, but he did not dig deeper. Notices issued under Sections 133(6)/131 of the Act were issued to M/s Gold Line International Finvest Limited, but nothing emerged from this effort. The payment for the shares in question was made by Sh. Salasar Trading Company. Notice was issued to this entity as well, but when the notices were returned unserved, the AO did not take the matter any further. He thereafter simply proceeded on the basis of the financials of the company to come to the conclusion that the transactions were accommodation entries, and thus, fictitious. The conclusion drawn by the AO, that there was an agreement to convert unaccounted money by taking fictitious LTCG in a pre-planned manner, is therefore entirely unsupported by any material on record. This finding is thus purely an assumption based on conjecture made by the AO. This flawed approach forms the reason for the learned ITAT to interfere with the findings of the lower tax authorities. The learned ITAT after considering the entire conspectus of case and the evidence brought on record, held that the Respondent had successfully discharged the initial onus cast upon it under the provisions of Section 68 of the Act. It is recorded that “There is no dispute that the shares of the two companies were purchased online, the payments have been made through banking channel, and the shares were dematerialized and the sales have been routed from de-mat account and the consideration has been received through banking channels.” The above noted factors, including the deficient enquiry conducted by the AO and the lack of any independent source or evidence to show that there was an agreement between the Respondent and any other party, prevailed upon the ITAT to take a different view. Before us, Mr. Hossain has not been able to point out any evidence whatsoever to allege that money changed hands between the Respondent and the broker or any other person, or further that some person provided the entry to convert unaccounted money for getting benefit of LTCG, as alleged. In the absence of any such material that could support the case put forth by the Appellant, the additions cannot be sustained. 12. Mr. Hossain’s submissions relating to the startling spike in the share price and other factors may be enough to show circumstances that might create suspicion; however, the Court has to decide an issue on the basis of evidence and proof, and not on suspicion alone. The theory of human behavior and preponderance of probabilities cannot be cited as a basis to turn a blind eye to the evidence produced by the Respondent. With regard to the claim that observations made by the CIT(A) were in conflict with the Impugned Order, we may only note that the said observations are general in nature and later in the order, the CIT(A) itself notes that the broker did not respond to the notices. Be Printed from counselvise.com 15 ITA No.4403/Del/2019 that as it may, the CIT(A) has only approved the order of the AO, following the same reasoning, and relying upon the report of the Investigation Wing. Lastly, reliance placed by the Revenue on Suman Poddar v. ITO (supra) and Sumati Dayal v. CIT (supra) is of no assistance. Upon examining the judgment of Suman Poddar (supra) at length, we find that the decision therein was arrived at in light of the peculiar facts and circumstances demonstrated before the ITAT and the Court, such as, inter alia, lack of evidence produced by the Assessee therein to show actual sale of shares in that case. On such basis, the ITAT had returned the finding of fact against the Assessee, holding that the genuineness of share transaction was not established by him. However, this is quite different from the factual matrix at hand. Similarly, the case of Sumati Dayal v. CIT (supra) too turns ITA 125/2020 and connected matters Page 10 of 10 on its own specific facts. The above-stated cases, thus, are of no assistance to the case sought to be canvassed by the Revenue. 13. The learned ITAT, being the last fact-finding authority, on the basis of the evidence brought on record, has rightly come to the conclusion that the lower tax authorities are not able to sustain the addition without any cogent material on record. We thus find no perversity in the Impugned Order. 14. In this view of the matter, no question of law, much less a substantial question of law arises for our consideration. 15. Accordingly, the present appeals are dismissed.” 15. Similar view was expressed by the Hon’ble Bombay High Court in the case of Pr. CIT v. Ziauddin A Siddique in Income Tax Appeal No. 2012 of 2017 dated 04/03/2022. 16. Therefore, we respectfully follow the ratio of the above decisions. In this case also, the Assessing Officer and Ld. CIT(A) has applied the concept of Human probabilities and held the above said scrip to be a penny stock without bring on record how the assessee is involved in any of the scrupulous activities or directly linked to one of the person who has involved in manipulation/rigging of share prices, entry operator or exit provider as observed by the Hon’ble Bombay High Court in the case of Ziauddin A Siddique (supra). Therefore, there is no material with the Printed from counselvise.com 16 ITA No.4403/Del/2019 tax authorities to substantiate their findings that the impugned transaction is non-genuine. Therefore, we are inclined to allow the grounds raised by the assessee. Accordingly, the grounds raised by the assessee are allowed. 17. In the result, appeal filed by the assessee is allowed. Order pronounced in the open court on this 27th February, 2026. Sd/- Sd/- (VIMAL KUMAR) (S.RIFAUR RAHMAN) JUDICIAL MEMBER ACCOUNTANT MEMBER Dated:27.02.2026 BINITA, SR. PS Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals). 5. DR: ITAT ASSISTANT REGISTRAR ITAT, NEW DELHI Printed from counselvise.com "