INCOME TAX OFFICER, MUMBAI vs. KRUPALI AKASH SHAH, MUMBAI
IN THE INCOME TAX APPELLATE TRIBUNAL
“SMC” BENCH MUMBAI
BEFORE HON’BLE SHRI SANDEEP GOSAIN, JUDICIAL MEMBER
Income Tax Officer
Room No. 735, 7th Floor,
Kautilya Bhavan, C-41 to C-
43, G Block, Bandra Kurla
Complex,
Bandra
(East).,
Mumbai- 400050
Vs.
Krupali Akash Shah
B-204,
Uday
Giri
Co.Op. Hsg. Soc Ltd.,
Ashok
Nagar,
Cross
Road,Kandivali
(East),
Mumbai- 400101
PAN/GIR No. CFPPS7219D
(Applicant)
(Respondent)
Assessee by Shri. Nitesh Shah
Revenue by Shri. Nagnath Pasale, SR. DR.
Date of Hearing
04.09.2025
Date of Pronouncement
17.11.2025
आदेश / ORDER
PER SANDEEP GOSAIN, JM:
The present appeal has been filed by the revenue challenging the impugned order 06.05.2025 passed u/s 250 of the Income Tax Act, 1961 (‘the Act’), by the National
Faceless Appeal Centre, Delhi (NFAC) for the assessment year 2012-13. 2. At the outset I notice that the only effective ground raised by the revenue relates to challenging the order of 2
Krupali Akash Shah
Ld. CIT(A) in deleting the addition made u/s 68 of the Income Tax Act.
3. In this regard, I have heard the counsels for both the parties, perused the material placed on record, judgments cited before me and also the orders passed by the revenue authorities.
4. As per the facts of the present case, Addition of sum of Rs. 8,76,443/- was made by AO u/s 68 of the Act on account of unexplained cash credit, thereby holding that the capital gains on the sale of shares of M/s. V.M.S.
Industries Limited was non-genuine.
5. On appeal Ld. CIT(A) thoroughly examining the facts of the case and noticed that while making of addition, the sale proceeds of the shares u/s 68 of the Act of Rs.
8,76,443/- was made by Ld.AO, without considering and reducing the purchase cost of Rs. 7,92,384/- against the said sale valuation of Rs. 8,76,443/- and consequently deleted the same.
6. The operative portion of Ld. CIT(A) is reproduced herein below:
“4. Consideration of issues under appeal and reasons for decision:-
1. The main contention of the assessee is as follows:
The learned Assessing officer erred in law and on facts in making unconceivable addition of Rs.
3
Krupali Akash Shah
8,76,443/- being sale of penny Stock. He failed to appreciate that Assessee has no role to play in same, all these type of transaction are carried from recognize stock exchange. The Investment in VMS Industries was done on the floor of the exchange, both purchase and sale. Details of the same were also submitted. The gain of Rs. 81.476
was included in short term capital gain and offered to Tax
2. From the computation of STCG it can be seen that the profit from sales of the impugned stock has been offered to tax. It can be seen that the assessee's claim of AO not considering the purchases is found factually correct. The main contention of the AO throughout the order is that claim of bogus LTCG through manipulation of publicly traded stocks. In this case it can be seen that assessee has not claimed any LTCG in the ITR. The relevant part of the Impugned order adding the sale receipts is reproduced below.
3 A transaction has to be considered as a whole le, purchases has to be considered along with the sales. Hence the addition made by the AO adding only the sale proceeds and not considering the purchases is bad in law and assessee's grounds are allowed. Addition made of Rs, 8,76,443/- is deleted as it has been made by adding only the sales receipt without considering the purchases.
4
Krupali Akash Shah
5. In view of the above, the appeal is allowed.”
After having heard counsels at length and perusal of the record, I find that Ld. CIT(A) had passed well reasoned order and on the contrary no new facts or circumstances have been placed on record by the appellate to controvert or rebut the lawful findings so recorded by Ld. CIT(A). Therefore I find no reasons to interference into or to deviated from the said findings. Hence, grounds raised by the revenue stands dismissed. 8. Consequently, the appeal filed by the revenue stands dismissed.
Order pronounced in the open court on 17.11.2025 (SANDEEP GOSAIN)
JUDICIAL MEMBER
Mumbai, Dated 17/11/2025
Disha Raut, Stenographer
आदेश की प्रतितिति अग्रेतिि/Copy of the Order forwarded to :
1. अपीलाथी / The Appellant
2. प्रत्यथी / The Respondent.
3. संबंधधत आयकर आयुक्त / The CIT(A)
4. आयकर आयुक्त(अपील) / Concerned CIT
5. धिभागीय प्रधतधनधध, आयकर अपीलीय अधधकरण,मुम्बई/ DR, ITAT, Mumbai
6. गार्ड फाईल / Guard file.
आदेशानुसार/BY ORDER,
सत्याधपत प्रधत ////
उि/सहायक िंजीकार ( Asst.