Kavita Manish Kheni vs. Income Tax Officer

Parties Involved

Facts Summary

The assessee, Kavita Manish Kheni, filed her return of income declaring total income at 'NIL', after claiming exemption under section 10(38) of the Act amounting to Rs.35,97,610/- in respect of gain on sale of shares. The Assessing Officer issued a show cause notice to the assessee stating that the investigation team revealed that the brokers were involved in providing accommodation entries and rigging the share prices, and the assessee availed only an accommodation entry and claimed bogus long-term capital gains. The assessee submitted that the shares were purchased through stock exchange and held in demat account until the date of sale. The Assessing Officer treated the sale price of the shares as an unexplained credit under section 68 of the Act, which was sustained by the learned Commissioner of Income Tax (Appeals). The assessee appealed against this order.…

Legal Issues

• 1. Whether the addition made by the Assessing Officer in respect of the claim for exemption u/s 10(38) in respect of long-term capital gain on sale of shares is justified?

Judgment Outcome

Decided in favour of Assessee.

Precedents Relied Upon

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