DCIT - 19(1), MUMBAI, LALBAUGH vs. BHARAT RAMJI BHAI MANEK, GRANT ROAD MUMBAI

ITA 4339/MUM/2025Status: DisposedITAT Mumbai10 February 2026AY 2014-15Bench: SHRI ANIKESH BANERJEE (Judicial Member), SHRI MAKARAND VASANT MAHADEOKAR (Accountant Member)1 pages
AI SummaryDismissed

What did the Tribunal hold?

The Tribunal held that the assessee had provided sufficient documentary evidence for the transactions, which were conducted through banking channels and a recognized stock exchange. The revenue failed to provide specific evidence linking the assessee to price manipulation.

What were the facts?

The assessee claimed exemption for Long Term Capital Gains (LTCG) on the sale of penny stock shares. The Assessing Officer (AO) treated these gains as bogus and added them back to the assessee's income. The CIT(A) deleted this addition, leading to an appeal by the revenue.

What were the issues?

Whether LTCG from penny stock transactions can be denied exemption when the assessee provides documentary evidence and the revenue lacks specific proof of manipulation.

Which sections of the Income-tax Act were involved?

Section 10(38),Section 143(3),Section 68

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Income Tax Appellate Tribunal, MUMBAI BENCH “B”, MUMBAI

For Appellant: Shri Ronak Doshi
For Respondent: Shri Leyaqat Ali Aafaqui, (SR DR)
Hearing: 28/01/2026Pronounced: 10/02/2026

Per: Anikesh Banerjee (JM): The instant appeal of the revenue was filed against the order of the NFAC, Delhi [for brevity ‘the Ld. CIT(A)], order passed under section 250 of the Income Tax Act 1961 (for brevity ‘the Act’) for assessment year 2014-15, date of order 08.04.2025. The impugned order emanated from the order of the Ld. Income-tax Officer Ward 19(1)(2), Mumbai (for brevity the Ld. AO) order passed under section 143(3) of the Act date of order 27.12.2016. 2 Bharat Ramji Bhai Manek

2.

The revenue has taken the following grounds. “Grounds of Appeal

1.

Whether on the facts and circumstances of the case and in law, the Ld. CIT(A) has erred in deleting the disallo

The order continues below.

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