INCOME TAX OFFICER, WARD 3(3)(5), AHMEDABAD vs. VAISHALI HARSHPAL SHAH, AHMEDABAD

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ITA 2526/AHD/2025Status: DisposedITAT Ahmedabad07 July 2026AY 2018-193 pages
AI SummaryDismissed

What did the Tribunal hold?

The CIT(A) deleted the addition, observing that the assessee had duly offered the profit as STCG and paid taxes. The CIT(A) found that the assessee was a bona fide investor engaged in regular share trading.

What were the facts?

The Assessing Officer (AO) treated the Short Term Capital Gain (STCG) of Rs. 42,32,050/- earned by the assessee from selling shares of Kushal Limited as unexplained income. The AO added this amount to the assessee's income and taxed it at a higher rate under Section 115BBE.

What were the issues?

Whether STCG from share transactions, where taxes were paid, can be treated as unexplained income and taxed at a higher rate.

Which sections of the Income-tax Act were involved?

Section 69A,Section 115BBE

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “B” BENCH, AHMEDABAD

Before: Shri Sanjay Garg & Shri Narendra Prasad Sinha

For Appellant: Shri Arpan Shah, AR
Hearing: 06/07/2026Pronounced: 07/07/2026

IN THE INCOME TAX APPELLATE TRIBUNAL “B” BENCH, AHMEDABAD ] ] Before Shri Sanjay Garg, Judicial Member And Shri Narendra Prasad Sinha, Accountant Member आयकर अपील सं /ITA No.2526/Ahd/2025 िनधा�रण वष� /Assessment Year : 2018-19 बनाम/ ITO, Vaishali Harshpal Shah, v/s. Ward-3(3)(5), 52, Irish Exotica, Corporate Road, Ahmedabad Satellite, Ahmedabad-380015 �थायी लेखा सं./PAN: CZDPS6109N (अपीलाथ�/ Appellant) (�� यथ�/ Respondent) Assessee by : Shri Arpan Shah, AR Revenue by : Shri Deependra Kumar, Sr. DR सुनवाई की तारीख/Date of Hearing : 06/07/2026 घोषणा की तारीख /Date of Pronouncement: 07/07/2026 आदेश/O R D E R Per Sanjay Garg, Judicial Member: The present appeal has been preferred by the Revenue against the order of the Learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi [hereinafter referred to as ‘Ld. CIT(A)’] dated 13/10/2025 passed u/s 250 of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) for the Assessment Year (AY) 2018- 19. 2. The Revenue in this appeal aggrieved by the action of the CIT(A) in deleting the addition of Rs. 42,32,050/- made by the AO u/s 69A of the Act r.w.s. 115BBE of the Act by treting the Short Term Capital Gain (in short ‘STCG’) claimed by the assessee as unexplained income of the assessee.

ITA No.2526/Ahd/2025 ITO vs. Vaishali Harshpal Shah Asst.Year 2018-19 2 3. The brief facts are that the assessee made purchase and sale transactions in the scrip of Kushal Limited, which as per the AO, was a penny stock company whose share price was rigged. As per the information received, the assessee had earned profit of Rs. 42,32,050/- from the sale of the shares of the Kushal Limited which were shown in the Return of Income as STCG and due taxes were paid thereupon. The Ld. AO, however, held the said STCG as unexplained income of the assessee and added the same into the income of the assessee u/s 69A of the Income Tax Act. He further invoked the provision of section 115BBE of the Act and charged the tax at a higher rate.

4.

The Ld. CIT(A), however, deleted the addition so made by the AO observing that the assesse had duly offered the tax on the profit on sale of shares of Kushal Limited by offering the same as STCG. That the assessee had not claimed the said income as exempt. He has further observed that the assessee, apart from making transactions in the said scrip of Kushal Limited, has also made transactions in the shares of various other companies viz. Biocon, IDFC First Bank, RBL, SBI Life, SVC Industries Limited and many more. He observed that the assessee was regularly doing share trading activity in various scrips. The shares were purchased and sold on various dates and it did demonstrate that the assessee was a bona fide investor. Ld. CIT(A) noted from the share transactions that it was not a case of earning of any bogus capital gains to avoid taxes rather, the assessee had shown the profits as STCG and duly paid the taxes. Considering the overall facts and circumstances of the case the Ld. CIT(A) held that it was not a case of earning of any

ITA No.2526/Ahd/2025 ITO vs. Vaishali Harshpal Shah Asst.Year 2018-19 3 bogus STCG and that the impugned addition made by the AO by converting the head of the income and thereby taxing the assessee at a higher rate was not justified. He, accordingly, deleted the additions so made by the AO.

5.

After hearing the Ld. Representatives of both the parties, we do not find any infirmity in the order of the Ld. CIT(A). The Ld. CIT(A) taking into consideration the overall facts and circumstances of the case has passed a reasoned order which do not warrant any interference at our end. There is no merit in the appeal of the Revenue and the same is, accordingly, dismissed.

6.

In the result, appeal of the Revenue is hereby dismissed.

Order pronounced in the Open Court on 07/07/2026.

Sd/- Sd/- (Narendra Prasad Sinha) (Sanjay Garg) Accountant Member Judicial Member अहमदाबाद/Ahmedabad, िदनांक/Dated 07/07/2025 TRUE COPY Tanmay, Sr. P.S. आदेश की �ितिलिप अ�ेिषत/Copy of the Order forwarded to : 1. अपीलाथ� / The Appellant 2. ��थ� / The Respondent. 3. संबंिधत आयकर आयु� / Concerned CIT 4. आयकर आयु� अपील ( ) / The CIT(A)-(NFAC) 5. िवभागीय �ितिनिध आयकर अपीलीय अिधकरण अहमदाबाद /DR,ITAT, Ahmedabad. , , 6. गाड� फाईल / Guard file. आदेशानुसार/ BY ORDER,

सहायक पंजीकार (Asstt. Registrar) आयकर अपीलीय अिधकरण, ITAT, Ahmedabad

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