← All Phrases

“bogus LTCG”

Cash Credits & Unexplained ItemsSection 68Section 68806 judgments

The decision most relied on for bogus LTCG is PCIT v. Swati Bajaj (139 Taxmann.com 352), cited in 443 judgments on BharatTax.

Leading authorities on bogus LTCG

PCIT v. Swati Bajaj
139 Taxmann.com 352 · 2022 · High Court
443
citing judgments

Tax authorities are entitled to examine surrounding circumstances and apply the test of human probabilities to determine the genuineness of long-term capital gains arising from the sale of manipulated penny stock, even if prima facie documents appear to support the transaction.

ITO, 19(3) (4) Mumbai v. Shamim M Bharwani
69 Taxmann.com 65 · 2016 · Reported
142
citing judgments

Long Term Capital Gains (LTCG) from penny stock transactions are liable to be treated as bogus and added back under Section 68 as unexplained cash credits, especially when evidence suggests the involvement of entry operators providing accommodation entries.

Mukesh R.Marolia v. Addl. CIT
6 SOT 247 · 2006 · ITAT
139
citing judgments

The department must substantiate its allegations of a bogus long term capital gain scheme; if not substantiated, the addition made by the Assessing Officer for purported bogus LTCG derived from the purchase/sale of shares cannot be sustained. An assessee's claim for long term capital gains exemption on share transactions should be allowed where documentation supports the transactions.

5. PCIT v. Paramount Communication (P.) Ltd. Delhi High Court
392 ITR 444 · 2017 · High Court
111
citing judgments

For valid initiation of reassessment proceedings, the Assessing Officer must possess tangible material and apply independent mind to form a 'reason to believe' that income has escaped assessment. Reassessment cannot be based on mere borrowed satisfaction or unverified information without proper scrutiny.

Suman Poddar v. ITO
423 ITR 480 · 2020 · High Court
84
citing judgments

The Assessing Officer's detailed findings regarding bogus long-term capital gains from penny stock transactions, established through objective examination of facts and circumstantial evidence, should not be overturned by appellate authorities without a thorough investigation or fresh inquiry.

CIT-I v. Maheshchandra G. Vakil
40 Taxmann.com 326 · 2013 · High Court
69
citing judgments

An Assessing Officer is not justified in treating capital gain from the sale of shares as unexplained cash credit when the assessee proves the genuineness of share transactions with contract notes, broker's bank statements, DMAT accounts, and stock exchange abstracts.

6. CIT v. Jasvinder Kaur
54 Taxmann.com 10 · 2015 · High Court
57
citing judgments

The Assessing Officer must provide the assessee with contrary material if they dispute the genuineness of long-term capital gains claimed under section 10(38). The onus is on the revenue to prove the transaction is a colourable device.

PCIT v. Parasben Kasturchand Kochar
130 Taxmann.com 177 · 2021 · Supreme Court
56
citing judgments

An assessment or reassessment order is considered bad in law and without legal sanction if its completion is not in accordance with prescribed legal procedures or timelines.

Judgments citing bogus LTCG

Krishan Khadaria, Mumbai vs. Dy. CIT (CC) 4 (3), Mumbai

In the result, the appeal filed by the assessee is allowed for statistical purpose

ITA 3201/MUM/2023[2015-16]Status: DisposedITAT Mumbai28 Mar 2025AY 2015-16

Bench: Ms. Kavitha Rajagopal, Jm & Smt. Renu Jauhri, Am

For Appellant: Shri. Ashok Bansal, CA a/w. ShriFor Respondent: Shri. Biswanath Das – CIT DR
Section 153ASection 250

found in the course of search action on the appellant did not support the allegation that he was indulged in providing accommodation entries of bogus LTCG by manipulating scrips of companies under his control and earning commission therefrom and, therefore, the said material did not trigger assessment u/s 153A ... assessment order is that Shri Raj Kumar Kedia is the person who managed & controlled share prices of some companies for reaping bogus LTCG including the companies under the control & management of the appellant and nowhere it is stated that the appellant was involved in rigging the prices of shares

Krishan Khadaria, Mumbai vs. Dy. CIT (CC) 4 (3), Mumbai

In the result, the appeal filed by the assessee is allowed for statistical purpose

ITA 3200/MUM/2023[2014-15]Status: DisposedITAT Mumbai28 Mar 2025AY 2014-15

Bench: Ms. Kavitha Rajagopal, Jm & Smt. Renu Jauhri, Am

For Appellant: Shri. Ashok Bansal, CA a/w. ShriFor Respondent: Shri. Biswanath Das – CIT DR
Section 153ASection 250

found in the course of search action on the appellant did not support the allegation that he was indulged in providing accommodation entries of bogus LTCG by manipulating scrips of companies under his control and earning commission therefrom and, therefore, the said material did not trigger assessment u/s 153A ... assessment order is that Shri Raj Kumar Kedia is the person who managed & controlled share prices of some companies for reaping bogus LTCG including the companies under the control & management of the appellant and nowhere it is stated that the appellant was involved in rigging the prices of shares

Krishan Khadaria, Mumbai vs. Dy. CIT (CC) 4 (3), Mumbai

In the result, the appeal filed by the assessee is allowed for statistical purpose

ITA 3199/MUM/2023[2013-14]Status: DisposedITAT Mumbai28 Mar 2025AY 2013-14

Bench: Ms. Kavitha Rajagopal, Jm & Smt. Renu Jauhri, Am

For Appellant: Shri. Ashok Bansal, CA a/w. ShriFor Respondent: Shri. Biswanath Das – CIT DR
Section 153ASection 250

found in the course of search action on the appellant did not support the allegation that he was indulged in providing accommodation entries of bogus LTCG by manipulating scrips of companies under his control and earning commission therefrom and, therefore, the said material did not trigger assessment u/s 153A ... assessment order is that Shri Raj Kumar Kedia is the person who managed & controlled share prices of some companies for reaping bogus LTCG including the companies under the control & management of the appellant and nowhere it is stated that the appellant was involved in rigging the prices of shares

Krishan Khadaria, Mumbai vs. Dy. CIT (CC) 4 (3), Mumbai

In the result, the appeal filed by the assessee is allowed for statistical purpose

ITA 3198/MUM/2023[2012-13]Status: DisposedITAT Mumbai28 Mar 2025AY 2012-13

Bench: Ms. Kavitha Rajagopal, Jm & Smt. Renu Jauhri, Am

For Appellant: Shri. Ashok Bansal, CA a/w. ShriFor Respondent: Shri. Biswanath Das – CIT DR
Section 153ASection 250

found in the course of search action on the appellant did not support the allegation that he was indulged in providing accommodation entries of bogus LTCG by manipulating scrips of companies under his control and earning commission therefrom and, therefore, the said material did not trigger assessment u/s 153A ... assessment order is that Shri Raj Kumar Kedia is the person who managed & controlled share prices of some companies for reaping bogus LTCG including the companies under the control & management of the appellant and nowhere it is stated that the appellant was involved in rigging the prices of shares

Krishan Khadaria, Mumbai vs. Dy. CIT (CC) 4 (3), Mumbai

In the result, the appeal filed by the assessee is allowed for statistical purpose

ITA 3197/MUM/2023[2011-12]Status: DisposedITAT Mumbai28 Mar 2025AY 2011-12

Bench: Ms. Kavitha Rajagopal, Jm & Smt. Renu Jauhri, Am

For Appellant: Shri. Ashok Bansal, CA a/w. ShriFor Respondent: Shri. Biswanath Das – CIT DR
Section 153ASection 250

found in the course of search action on the appellant did not support the allegation that he was indulged in providing accommodation entries of bogus LTCG by manipulating scrips of companies under his control and earning commission therefrom and, therefore, the said material did not trigger assessment u/s 153A ... assessment order is that Shri Raj Kumar Kedia is the person who managed & controlled share prices of some companies for reaping bogus LTCG including the companies under the control & management of the appellant and nowhere it is stated that the appellant was involved in rigging the prices of shares

Krishan Khadaria, Mumbai vs. Dy. CIT (CC) 4 (3), Mumbai

In the result, the appeal filed by the assessee is allowed for statistical purpose

ITA 3196/MUM/2023[2010-11]Status: DisposedITAT Mumbai28 Mar 2025AY 2010-11

Bench: Ms. Kavitha Rajagopal, Jm & Smt. Renu Jauhri, Am

For Appellant: Shri. Ashok Bansal, CA a/w. ShriFor Respondent: Shri. Biswanath Das – CIT DR
Section 153ASection 250

found in the course of search action on the appellant did not support the allegation that he was indulged in providing accommodation entries of bogus LTCG by manipulating scrips of companies under his control and earning commission therefrom and, therefore, the said material did not trigger assessment u/s 153A ... assessment order is that Shri Raj Kumar Kedia is the person who managed & controlled share prices of some companies for reaping bogus LTCG including the companies under the control & management of the appellant and nowhere it is stated that the appellant was involved in rigging the prices of shares

Krishan Khadaria, Mumbai vs. Dy. CIT (CC) 4 (3), Mumbai

In the result, the appeal filed by the assessee is allowed for statistical purpose

ITA 3195/MUM/2023[2009-10]Status: DisposedITAT Mumbai28 Mar 2025AY 2009-10

Bench: Ms. Kavitha Rajagopal, Jm & Smt. Renu Jauhri, Am

For Appellant: Shri. Ashok Bansal, CA a/w. ShriFor Respondent: Shri. Biswanath Das – CIT DR
Section 153ASection 250

found in the course of search action on the appellant did not support the allegation that he was indulged in providing accommodation entries of bogus LTCG by manipulating scrips of companies under his control and earning commission therefrom and, therefore, the said material did not trigger assessment u/s 153A ... assessment order is that Shri Raj Kumar Kedia is the person who managed & controlled share prices of some companies for reaping bogus LTCG including the companies under the control & management of the appellant and nowhere it is stated that the appellant was involved in rigging the prices of shares

ACIT Circle-4(3)(1), Mumbai vs. Jmp Securities Pvt Ltd, Mumbai

In the result, the appeal filed by the revenue is dismissed and the cross objection filed by the assessee is allowed

ITA 3792/MUM/2024[2017-18]Status: DisposedITAT Mumbai27 Mar 2025AY 2017-18

Bench: Shri. Amarjit Singh, Am & Ms. Kavitha Rajagopal, Jm Acit, Circle-4(3)(1) Jmp Securities Pvt. Ltd. Aayakar Bhavan, M. K. Road, 801/806, 8Th Floor, Elite Square, 274, Churchgate, Mumbai – 400020. Vs. Perin Nariman St. Bazar Gate, Fort, Mumbai – 400001. Pan/Gir No. Aaacj8850C (Appellant) : (Respondent) C. O. No. 182/Mum/2024 (Arising Out Of Ita No. 3792/Mum/2024) (Assessment Year: 2017-18) Jmp Securities Pvt. Ltd. Acit, Circle-4(3)(1) 801/806, 8Th Floor, Elite Square, 274, Aayakar Bhavan, M. K. Road, Perin Nariman St. Bazar Gate, Fort, Vs. Churchgate, Mumbai – 400020. Mumbai – 400001. Pan/Gir No. Aaacj8850C (Appellant) : (Respondent) : Shri. Omkandalkar Assessee By Respondent By : Shri. Hemankumar Chimanlal Leuva Cit Dr. Date Of Hearing : 05.02.2025 Date Of Pronouncement : 27.03.2025 O R D E R Per Kavitha Rajagopal, J M: This Appeal Has Been Filed By The Revenue & Cross Objection Filed By The Assessee, Challenging The Order Of The Learned Commissioner Of Income Tax (Appeals) Delhi (‘Ld. Cit(A)’ For Short), National Faceless Appeal Centre (‘Nfac’ For Short)

For Respondent: Shri. Hemankumar Chimanlal Leuva
Section 147Section 148Section 151Section 151ASection 250Section 68Section 69

bogus loan. Also, there was information based on search action conducted u/s. 132 in the case of Nagpal Group dated 10.1.2018, who had claimed bogus LTCG through investment in Solis Marketing Limited amounting to Rs. 6,53,431/- was unearthed. The assessee was also found

ITO Ward 41(1)(1), Mumbai, Kautilya Bhavan, Bkc vs. Arvind Velji Gada, Mumbai

In the result, both the appeals of the assessee and Revenue

ITA 2026/MUM/2024[2016-17]Status: DisposedITAT Mumbai27 Mar 2025AY 2016-17

Bench: Shri Om Prakash Kant () & Ms. Kavitha Rajagopal () Assessment Year: 2016-17 Arvind Velji Gada, Ito Ward 41(1)(1), 1704 12Th Floor, Bellezza Tower, Kautilya Bhavan, Avenue 3, Near Vs. 420, Bhavani Shankar Road, Videsh Bhavan, G Block Bkc, Dadar (West) Bandra Kurla Complex, Bandra Mumbai-400028. East, Mumbai-400051. Pan No. Aespg 4212 Q Appellant Respondent Assessment Year: 2016-17 Ito Ward 41(1)(1), Arvind Velji Gada, Kautilya Bhavan, Avenue 3, 1704 12Th Floor, Bellezza Tower, 420, Vs. Near Videsh Bhavan, G Block Bhavani Shankar Road, Dadar Bkc, Bandra Kurla Complex, (West) Bandra East, Mumbai-400028. Mumbai-400051. Pan No. Aespg 4212 Q Appellant Respondent

For Respondent: Mr. Ajay R Singh/
Section 68

erred in deleting the addition of Rs. 10,00,000/ by the AO on account of claim of Bogus LTCG in penny stock without by the AO on account of claim of Bogus LTCG in penny stock without by the AO on account of claim of Bogus LTCG in penny

Arvind Velji Gada, Mumbai vs. ITO Ward 41(1)(1), Mumbai

In the result, both the appeals of the assessee and Revenue

ITA 1582/MUM/2024[2016-17]Status: DisposedITAT Mumbai27 Mar 2025AY 2016-17

Bench: Shri Om Prakash Kant () & Ms. Kavitha Rajagopal () Assessment Year: 2016-17 Arvind Velji Gada, Ito Ward 41(1)(1), 1704 12Th Floor, Bellezza Tower, Kautilya Bhavan, Avenue 3, Near Vs. 420, Bhavani Shankar Road, Videsh Bhavan, G Block Bkc, Dadar (West) Bandra Kurla Complex, Bandra Mumbai-400028. East, Mumbai-400051. Pan No. Aespg 4212 Q Appellant Respondent Assessment Year: 2016-17 Ito Ward 41(1)(1), Arvind Velji Gada, Kautilya Bhavan, Avenue 3, 1704 12Th Floor, Bellezza Tower, 420, Vs. Near Videsh Bhavan, G Block Bhavani Shankar Road, Dadar Bkc, Bandra Kurla Complex, (West) Bandra East, Mumbai-400028. Mumbai-400051. Pan No. Aespg 4212 Q Appellant Respondent

For Respondent: Mr. Ajay R Singh/
Section 68

erred in deleting the addition of Rs. 10,00,000/ by the AO on account of claim of Bogus LTCG in penny stock without by the AO on account of claim of Bogus LTCG in penny stock without by the AO on account of claim of Bogus LTCG in penny

Mahendra Sharma, Jaipur vs. ITO, Ward-3(1), Jaipur

In the result, the appeal of the assessee is allowed

ITA 654/JPR/2023[2011-12]Status: DisposedITAT Jaipur25 Mar 2025AY 2011-12
For Appellant: Shri Sarwan Kumar Gupta, AdvFor Respondent: Shri Anup Singh, Addl.CIT
Section 143(2)Section 143(3)Section 147Section 148Section 151Section 250Section 68

cash credit. And also made the addition of Rs.5,76,262/- u/s 69C on account of alleged unexplained expenditure @ 6% for obtaining these alleged bogus LTCG. 2.2 In first appeal before ld. CIT (A), assessee has filed detailed written submission and documents. However, the ld. CIT(A) has summarily rejected ... borrowed satisfaction; The Ld. AO has issued notice u/s 148 on the basis of borrowed information from the Investigation Wing in respect of bogus LTCG, without verifying the correctness of the information and therefore re-assessment proceedings is absolutely bad in law and without jurisdiction and further AO not recorded

Usha Hitesh Sanghvi, Girgaon S.O, Mumbai vs. ITO-19(3)(5), Mumbai, Lal Baug

Appeal of the assessee is allowed

ITA 6172/MUM/2024[2013-14]Status: DisposedITAT Mumbai25 Mar 2025AY 2013-14

Bench: Shri Saktijit Dey & Shri Prabhash Shankar

For Appellant: Shri Rajkumar Singh, ARFor Respondent: Ms. Kavitha Kaushik (Sr. DR)
Section 10(38)Section 143(3)Section 148Section 68Section 69C

contented that there is neither any allegation nor any shred of evidence that assessee has approached any alleged Operator or share broker for such bogus LTCG nor any evidence or allegation as to involvement of or dealing or refunds of cash in the transactions. The transaction of sale of shares ... that entire case of the revenue hinges upon the presumption that the assessee has ploughed back his own unaccounted money in the form of bogus LTCG. However, this presumption or suspicion how strong it may appear to be true, but needs to be corroborated by some evidence to establish

Universal Drinks, New Delhi vs. ACIT, Circle-42(1), New Delhi

ITA 2283/DEL/2019[2015-16]Status: HeardITAT Delhi25 Mar 2025AY 2015-16

Bench: Shri Yogesh Kumar U.S. & Shri Manish Agarwali.T.A. No.2283/Del/2023 (A.Y 2011-12) Raheja Developers Limited Vs Acit W4D-204/5, Keshav Kunj, Central Circle-19 Cariappa Marg, Sainik Farms, New Delhi New Delhi, Pan: Aaacr0468E Appellant Respondent I.T.A. No.2284/Del/2023 (A.Y 2012-13) Raheja Developers Limited Vs Acit W4D-204/5, Keshavkunj, Central Circle-19 Cariappa Marg, Sainik Farms, New Delhi New Delhi, Pan: Aaacr0468E Appellant Respondent Assessee By Sh. Neeraj Jain, Ca& Sh. P. K. Mishra, Ca Revenue By Ms.Pooja Swaroop, Cit (Dr) Date Of Hearing 24/07/2025 Date Of Pronouncement 17/10/2025

Section 143(3)Section 147Section 148Section 14ASection 68

1 ITA No. 2283 & 2284/Del/2023 Raheja Developers Ltd. vs. ACIT IN THE INCOME TAX APPELLATE TRIBUNAL DELHI DELHI BENCH ‘B

Alok Kumar Jain, Pearl Pleasure vs. ACIT Cir-6, Jaipur, New Cerntral Revenue Building, Bhagwan Dass Road, Rajasthan

ITA 1191/JPR/2024[2016-17]Status: DisposedITAT Jaipur24 Mar 2025AY 2016-17

Bench: Him.

For Appellant: Sh. Prakul Khurana, Adv. &For Respondent: Mrs. Anita Rinesh, JCIT-Sr. DR
Section 10(38)Section 147Section 148Section 250Section 68Section 69A

deleting the addition made u/s 69A of the Act by the AO on account of commission paid of Rs. 23,87,341/- towards availing bogus LTCG for acquiring accommodation entries? 4. Whether on the facts and circumstances of the case and in law, the Ld. CIT(A) is justified ... since the claim is nothing but the manipulation by the assessee for routing his own unaccounted cash credit in the guise of bogus LTCG. Therefore, the same is assessed in the hands of the assessee as unexplained cash credit within the meaning of Section 68 r.w.s. 115BBE

Shrenik Kumar Virchand Mardia, Mumbai vs. ITO Ward 23(3)(6), Mumbai

In the result, the appeal of the assessee bearing ITA 558/Mum/2025 is allowed

ITA 558/MUM/2025[2015-16]Status: DisposedITAT Mumbai24 Mar 2025AY 2015-16

Bench: the date of hearing.”

For Appellant: Shri R.M. JainFor Respondent: Ms. Kavitha Kaushik (SRDR)
Section 10(38)Section 139(1)Section 144BSection 147Section 148Section 250Section 69C

hands of the assessee. After deducting the purchase cost of the shares, the net capital gain of Rs.2,04,42,976/- was treated as bogus LTCG and was added to the assessee’s total income. Aggrieved by the assessment order, the assessee preferred an appeal before

DCIT, Circle-2, Nagpur vs. Naresh Laxminarayan Grover, Nagpur

In the result, all these three appeals for the A

ITA 526/NAG/2024[2016-17]Status: DisposedITAT Nagpur21 Mar 2025AY 2016-17

Bench: Shri V. Durga Rao & Shri K.M. Roy, Accountant, Member

For Appellant: Shri Aryan GroverFor Respondent: Shri Sandipkumar Salunke

Kolkata Investigation Wing has thoroughly investigated and proven the modus operandi of conversion of unaccounted income to counted one through penny stock by claiming bogus LTCG and STCG Loss." 10. How the case of the appellant is not covered by investigation report of the DDIT Inv Kolkata

DCIT, Circle-2, Nagpur vs. Naresh Laxminarayan Grover, Nagpur

In the result, all these three appeals for the A

ITA 525/NAG/2024[2015-16]Status: DisposedITAT Nagpur21 Mar 2025AY 2015-16

Bench: Shri V. Durga Rao & Shri K.M. Roy, Accountant, Member

For Appellant: Shri Aryan GroverFor Respondent: Shri Sandipkumar Salunke

Kolkata Investigation Wing has thoroughly investigated and proven the modus operandi of conversion of unaccounted income to counted one through penny stock by claiming bogus LTCG and STCG Loss." 10. How the case of the appellant is not covered by investigation report of the DDIT Inv Kolkata

DCIT, Circle-2, Nagpur vs. Naresh Laxminarayan Grover, Nagpur

In the result, all these three appeals for the A

ITA 524/NAG/2024[2014-15]Status: DisposedITAT Nagpur21 Mar 2025AY 2014-15

Bench: Shri V. Durga Rao & Shri K.M. Roy, Accountant, Member

For Appellant: Shri Aryan GroverFor Respondent: Shri Sandipkumar Salunke

Kolkata Investigation Wing has thoroughly investigated and proven the modus operandi of conversion of unaccounted income to counted one through penny stock by claiming bogus LTCG and STCG Loss." 10. How the case of the appellant is not covered by investigation report of the DDIT Inv Kolkata

Munjal Mrugesh Jaykrishna, Ahmedabad vs. The Dy.CIT, Circle-1(1)(1), Ahmedabad

ITA 1792/AHD/2024[2013-14]Status: DisposedITAT Ahmedabad21 Mar 2025AY 2013-14

Bench: Dr. B.R.R. Kumarshri T.R. Senthil Kumar

For Appellant: Shri Mukesh Patel, ARFor Respondent: Shri Rignesh Das, Sr.DR
Section 10(38)Section 143(3)Section 147Section 250Section 68

Departmental investigation the statements of various operators/ share brokers/members were recorded on oath, confirming that certain beneficiaries transacted in this script by way of bogus LTCG and claimed exemption u/s. 10(38). g. I wish to emphatically place on record that in the list of persons alleged to be penny

Income Tax Officer, Mumbai vs. Rajesh Dineshchandra Sanghvi, Mumbai

In the result, the appeal filed by the revenue stands dismissed with no orders to cost

ITA 453/MUM/2025[2012-13]Status: DisposedITAT Mumbai21 Mar 2025AY 2012-13

Bench: Hon’Ble Shri Br Baskaran & Hon’Ble Shri Sandeep Gosainito-41(2)(4) Vs. Rajesh Dineshchandra 836, Kautilya Bhawan, Bkc, Sanghvi Mumbai – 400051. 36, Gala Industrial Estate, Din Dayal Upadhyaya Marg 400080. Pan/Gir No. Aacps1668Q (Applicant) (Respondent)

Section 10(38)Section 133(6)Section 147Section 148Section 149(1)(b)Section 250Section 68

scrip of VAS INFRA. The persons selling the scrip when the price of the scrip is high at its peak are all beneficiaries of bogus LTCG. The exit providers were not able to provide any logical explanation of the source of fund they have invested in the scrip when ... price was at its peak. Thus, it appears that the scrip M/s. VAS INFRA has been used to provide bogus LTCG to various beneficiaries. The assesse is one of such beneficiaries and sold shares during F.Y. 2011-12 for the amount totaling to Rs. 3,12,131.7. The assesse claimed