INCOME TAX OFFICER, WARD-1, MEHSANA, MEHSANA vs. LEGAL HEIR OF ARVINDKUMAR SEVANTILAL SHAH, MEHSANA

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ITA 1264/AHD/2025Status: DisposedITAT Ahmedabad07 October 2025AY 2012-13Bench: DR. B.R.R. KUMAR, VICE-PRESIDENT Ms SUCHITRA KAMBLE (Judicial Member)2 pages

In favour of the assessee: the Revenue's appeal was dismissed. From the AI summary of this appeal.

AI SummaryDismissed

What did the Tribunal hold?

The Income Tax Appellate Tribunal upheld the CIT(A)'s decision to delete the addition. The Tribunal ruled that the Revenue failed to produce any evidence demonstrating that the assessee actually purchased, sold, or received any money from the alleged penny stock transactions, hence no addition could be sustained.

What were the facts?

The Revenue challenged the CIT(A)'s decision to delete an addition of Rs. 1,42,200/- for Assessment Year 2012-13, which was made on account of the assessee's alleged investment in penny stock of M/s. VMS Industries Limited. The CIT(A) had deleted this addition, prompting the Revenue's appeal.

What were the issues?

Whether the CIT(A) was correct in deleting an addition related to penny stock investment, given the Revenue's failure to provide any evidence to substantiate the transaction.

Which sections of the Income-tax Act were involved?

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “SMC” BENCH, AHMEDABAD

Before: DR. B.R.R. KUMAR, VICE-Ms SUCHITRA KAMBLE

For Appellant: Shri Sudhakar Verma, Sr. DR
For Respondent: Shri Tej Shah, AR
Hearing: 06.10.2025Pronounced: 07.10.2025

O R D E R PER DR. B.R.R. KUMAR, VICE-PRESIDENT:-

1.

The captioned appeal has been filed by the Revenue against the order passed by the Ld. Commissioner of Income Tax (Appeals)-10, Mumbai, vide order dated 07.03.2025 relevant to the Assessment Year 2012-13. 2. The Revenue has raised the following grounds of appeal:

(1) The Ld.CIT(A) has erred in law and on facts in deleting the addition of Rs.1,42,200/- considering the investment in Penny Stock namely M/s.VMS Industries Limited. Asst. Year : 2012-13 - 2– (2) The Appellant craves leave to add, later and/or to amend all any the ground before the final hearing of the appeal.

3. The Revenue made an addition of Rs.1,42,200/- on account of the profit and out of Penny Stock. However, the Revenue absolutely failed to bring on record any iota of evidence that the assessee has indeed purchased and sold stock and received monies in his account. In the absence of any cogent evidence to prove that the assessee has received monies or engaged in the sale of stock, no addition can be made in this case.

4.

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

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