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“penny stock”

Cash Credits & Unexplained ItemsSection 68Section 681,661 judgments

RAMESHKUMAR KARSANBHAI PATEL,SURAT vs. ITO, WARD 2(3)(5), SURAT

Accordingly the estimated addition made of Rs.35,166/-[0.5% of 70,33,182/-] by the AC invoking provision of section 69C of the I.T Act stand deleted. Thus this ground is allowed

ITA 669/SRT/2025[2015-16]Status: DisposedITAT Surat09 Apr 2026AY 2015-16

Bench: Dr. B.R.R. Kumar, Vice-Ms. Suchitra Kamble

Section 10(38)Section 115Section 115BSection 250Section 68Section 69C

case was selected for scrutiny under CASS on the issue of ‘suspicious sale transaction in shares and exempt Long Term Capital Gains (penny stock) shown in return. During the year under consideration, the assessee earned Long Term Capital Gain of Rs.70,33,182/- on sale of 15,000 equity shares ... Asian Ltd., which were later credited in the assessee’s demat account. The Assessing Officer, relying upon information received from the Investigation Wing regarding penny stock manipulation, held that the scrip of Sunrise Asian Ltd. was used for generating bogus LTCG entries. The Assessing Officer observed that the price

BHAWNA KAPOOR,NEW DELHI vs. ACIT CIRCLE-62(1), NEW DELHI

In the result, appeal filed by the assessee is allowed

ITA 632/DEL/2020[2014-15]Status: DisposedITAT Delhi09 Apr 2026AY 2014-15

Bench: Shri S Rifaur Rahman & Shri Vimal Kumarsmt. Bhawna Kapoor Vs. Acit Prop M/S Manish Circle 62(1) Handicraft 1196, Main Delhi Bazar, Paharganj, New Delhi 110055 "थायीलेखासं./जीआइआरसं./Pan/Gir No: Adxpk 3853 F Appellant .. Respondent

For Appellant: Sh. Ramesh Chander, AdvFor Respondent: Ms. Harpreet Kaur Hansra, Sr. DR
Section 10(38)Section 142(1)Section 143(2)Section 143(3)Section 250(6)Section 68Section 69A

shown as long term capital gain and claimed as exempt u/s 10(38) of the Act. The Directorate of Investigation, Kolkata identified 84 listed penny stock companies, shares of which were used for generating bogus LTCG by various entry operators for the beneficiaries who approached the entry operators ... suspicion howsoever strong it may be cannot substitute the evidences produced for proving a fact. Merely because a particular scrip is identified as a Penny stock by the Revenue it does not mean all the transactions carried out in that scrip were bogus, 6.1. Appellant's case is covered

GYAN PRAKASH GUPTA,NEW DELHI vs. ITO WARD-10(4), NEW DELHI

In the result, appeal filed by the assessee is allowed

ITA 6271/DEL/2019[2015-16]Status: DisposedITAT Delhi09 Apr 2026AY 2015-16

Bench: Shri S Rifaur Rahman & Shri Vimal Kumarlate Gyan Prakash Gupta Vs. Ito Through Legal Heir Raj Ward 10(4) Kumari Gupta New Delhi Plot No.6 & 7, Defence Enclave, Laxmi Nagar, East Delhi 110092 "थायीलेखासं./जीआइआरसं./Pan/Gir No: Adupg 2697 N Appellant .. Respondent

For Appellant: Sh. Ajit Gandhi, AdvFor Respondent: Ms. Harpreet Kaur Hansra, Sr. DR
Section 10Section 10(38)Section 143(2)Section 143(3)Section 250Section 68

erred in concluding without any basis that assessee has introduced his unaccounted income in the form of long term capital gain by manipulating the penny stock. 20. That the grounds of appeal as herein are without prejudice to each other. 21. That the appellant craves to add, amend, alter ... Cases Relied Upon where the matter before courts were the matter before courts was: (a) whether an addition/disallowance can be made in the penny stocks merely influenced by Generalized Investigation reports and SEBI orders when neither such reports or order contain assessee's name and the case of assessee

PRAVEEN GARG HUF,ROURKELA vs. ITO, WARD 1, ROURKELA, ROURKELA

In the result, both the appeals of the assessee are allowed

ITA 823/CTK/2025[2014-15]Status: DisposedITAT Cuttack16 Mar 2026AY 2014-15

Bench: Shri George Mathan & Shri Rajesh Kumarita No.822&823/Ctk/2025 Assessment Year: 2014-15 Praveen Garg Huf Ito, Ward-1, Rourkela Gurudrawara Road, Rourkela, Vs Odisha-769001. (Pan: Aahhp0557Q) (Appellant) (Respondent)

For Appellant: Shri Abhijeet Agarwal, ARFor Respondent: Shri Shakeer Ahamed, Sr. DR
Section 10(38)Section 271

assessee is called for. Consequently, the addition as made by the Assessing Officer and confirmed by ld CIT(A) in respect of alleged penny stock stands deleted. The Assessing Officer is directed to allow the benefit of exemption claimed u/s.10(38) of the Act.” 3.1 It was the submission that

PRAVEEN GARG HUF,ROURKELA vs. ITO, WARD 1, ROURKELA, ROURKELA

In the result, both the appeals of the assessee are allowed

ITA 822/CTK/2025[2014-15]Status: DisposedITAT Cuttack16 Mar 2026AY 2014-15

Bench: Shri George Mathan & Shri Rajesh Kumarita No.822&823/Ctk/2025 Assessment Year: 2014-15 Praveen Garg Huf Ito, Ward-1, Rourkela Gurudrawara Road, Rourkela, Vs Odisha-769001. (Pan: Aahhp0557Q) (Appellant) (Respondent)

For Appellant: Shri Abhijeet Agarwal, ARFor Respondent: Shri Shakeer Ahamed, Sr. DR
Section 10(38)Section 271

assessee is called for. Consequently, the addition as made by the Assessing Officer and confirmed by ld CIT(A) in respect of alleged penny stock stands deleted. The Assessing Officer is directed to allow the benefit of exemption claimed u/s.10(38) of the Act.” 3.1 It was the submission that

RAJIV LAXMAN DALAL HUF,AHMEDABAD vs. ITO, WARD 5(2)(3), AHMEDABAD

In the result, the appeal of the assessee is partly allowed for statistical purpose

ITA 2559/AHD/2025[2015-2016]Status: DisposedITAT Ahmedabad16 Mar 2026AY 2015-2016

Bench: Ms. Suchitra Kambleassessment Year 2015-16

For Appellant: Shri Bharat S. Shah, A.RFor Respondent: Smt. Mamta Singh, Sr. D.R
Section 143(2)Section 143(3)Section 68

dated 06.12.2017, the total income of the assessee was determined of Rs.23,11,180/-, after making addition of (i) LTCG, on the transacted in penny stock Kappac Pharma of Rs. 10,02,085/- was made treated it as undisclosed income of the appellant u/s 68 of the Income

SMT. SANTOSH BAMALWA,DIBRUGARH vs. ACIT, CIRCLE-1, DIBRUGARH

In the result, all the appeals of the Revenue are dismissed and that of the Cross Objections of the assessees are allowed

ITA 348/GTY/2025[2011-12]Status: DisposedITAT Guwahati13 Mar 2026AY 2011-12

Bench: Shri Duvvuru Rl Reddy & Shri Rajesh Kumarsmt. Santosh Bamalwa Acit, Circle-1 C/O A.K. Varma, Ground Floor, Aayakar Bhawan, 2Nd Floor, Vs. Mahalaya Road, Dibrugarh- Milan Nagar, Dibrugarh-786003, 786001, Assam Assam (Appellant) (Respondent) Pan No. Aedpb9900P Assessee By : Shri S.K. Tulsiyan, Advocate Revenue By : Shri Santosh Kumar Karnani, Addl. Cit Date Of Hearing: 09/03/2026 Date Of Pronouncement: 13/03/2026 O R D E R

For Appellant: Shri S.K. Tulsiyan, AdvocateFor Respondent: Shri Santosh Kumar Karnani, Addl
Section 10(38)Section 143(1)Section 143(3)Section 147Section 148Section 68

Santosh Bamalwa Vs ACIT the Assessing Officer primarily relied on the investigation report of Directorate of Investigation, Kolkata in respect of 84 penny stocks. However, we note that the impugned scrip of Twenty First Century (India) Ltd. was not included in the said list. We note that the Assessing Officer ... noted that the said scrip is penny stock company controlled and operated by the entry operators and the financial statements of Twenty First Century (India) Ltd. reflecting negligible business activity and losses. Therefore, the said penny stock is nothing but accommodation entry arranged by the assessee through SEBI registered brokers

ANIKET SINGAL,NEW DELHI vs. DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE-1, CHANDIGARH, CHANDIGARH

ITA 939/CHANDI/2025[2016-17]Status: DisposedITAT Chandigarh13 Mar 2026AY 2016-17
For Appellant: Shri Ashwani Kumar & Ms. Deepali Aggarwal, C.A'sFor Respondent: Shri Manav Bansal, CIT, DR
Section 10(38)Section 132Section 132(4)Section 250(6)Section 68Section 69C

establish\nthat the fact that the assessee received huge investment amounts of receipts\nin the garb of sale proceeds against shares of various bogus penny stock\ncompanies, managed and controlled by these entry operators. The assessee\nfailed to submit any satisfactory explanation regarding these transactions\ncoupled with the plethora ... group search\nand in third-part entry operator investigations is legitimate, particularly because\nthe modus operandi of generating sham LTCG through rigging of penny-stock\nprices is a continuing pattern. The appellant assets that such statements were\nneither confronted nor cross-examination offered. Two answers: first, the\naddition here does

ANIKET SINGAL,NEW DELHI vs. DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE-1, CHANDIGARH

In the result, all the above appeals are allowed

ITA 1146/CHANDI/2025[2017-18]Status: DisposedITAT Chandigarh13 Mar 2026AY 2017-18

Bench: SHRI. RAJPAL YADAV (Vice President), SHRI. KRINWANT SAHAY, AM आयकर अपील सं. / ITA No. 939/Chd/2025 निर्धारण वर्ष / Assessment Year : 2016-17 Shri Aniket Singal बनाम The DCIT 4, Amritashergil Marg, New Delhi- 110003 Central Circle-1 Chandigarh स्थायी लेखा सं./ PAN NO: CZCPS6126E अपीलार्थी/Appellant प्रत्यर्थी / Respondent आयकर अपील सं. / ITA No. 1145/Chd/2025 निर्धारण वर्ष / Assessment Year : 2017-18 Smt. Aarti Singal बनाम The DCIT 53, Jor Bagh, New Delhi-110003 Central Circle-1 Chandigarh स

For Appellant: Shri Ashwani Kumar & Ms. Deepali Aggarwal, C.A’sFor Respondent: Shri Manav Bansal, CIT, DR
Section 10(38)Section 132Section 132(4)Section 250(6)Section 68Section 69C

establish that the fact that the assessee received huge investment amounts of receipts in the garb of sale proceeds against shares of various bogus penny stock companies, managed and controlled by these entry operators. The assessee failed to submit any satisfactory explanation regarding these transactions coupled with the plethora ... group search and in third-part entry operator investigations is legitimate, particularly because the modus operandi of generating sham LTCG through rigging of penny-stock prices is a continuing pattern. The appellant assets that such statements were neither confronted nor cross-examination offered. Two answers: first, the addition here does

AARTI SINGAL,NEW DELHI vs. DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE-1, CHANDIGARH

In the result, all the above appeals are allowed

ITA 1145/CHANDI/2025[2017-18]Status: DisposedITAT Chandigarh13 Mar 2026AY 2017-18

Bench: SHRI. RAJPAL YADAV (Vice President), SHRI. KRINWANT SAHAY, AM आयकर अपील सं. / ITA No. 939/Chd/2025 निर्धारण वर्ष / Assessment Year : 2016-17 Shri Aniket Singal बनाम The DCIT Central Circle-1 Chandigarh 4, Amritashergil Marg, New Delhi- 110003 स्थायी लेखा सं./ PAN NO: CZCPS6126E अपीलार्थी/Appellant प्रत्यर्थी / Respondent आयकर अपील सं. / ITA No. 1145/Chd/2025 निर्धारण वर्ष / Assessment Year : 2017-18 Smt. Aarti Singal बनाम The DCIT Central Circle-1 Chandigarh 53, Jor Bagh, New Delhi-110003 स

For Appellant: Shri Ashwani Kumar & Ms. Deepali Aggarwal, C.A’sFor Respondent: Shri Manav Bansal, CIT, DR
Section 10(38)Section 132Section 132(4)Section 250(6)Section 68Section 69C

establish that the fact that the assessee received huge investment amounts of receipts in the garb of sale proceeds against shares of various bogus penny stock companies, managed and controlled by these entry operators. The assessee failed to submit any satisfactory explanation regarding these transactions coupled with the plethora ... group search and in third-part entry operator investigations is legitimate, particularly because the modus operandi of generating sham LTCG through rigging of penny-stock prices is a continuing pattern. The appellant assets that such statements were neither confronted nor cross-examination offered. Two answers: first, the addition here does

SARIT GUPTA (HUF),NEW DELHI vs. INCOME TAX OFFICER, WARD 43(6), NEW DELHI

In the result the appeal of the assessee is allowed

ITA 6662/DEL/2025[2015-16]Status: DisposedITAT Delhi13 Mar 2026AY 2015-16

Bench: the NFAC who vide order dated 28-08-2025 dismissed the appeal. Being, aggrieved the order of the Ld. NFAC, the assessee is in appeal before the Tribunal.

Section 10(38)Section 147Section 148Section 148ASection 149Section 149(1)Section 3

this case information was received to the department that the share price of Achal investment limited is one of the penny stock companies listed with Bombay Stock Exchange was artificially rigged to provide entry of bogus long term capital gain and it was found that the assessee

VANEET AGGARWAL,NEW DELHI vs. ACIT, CIRCLE-14(2), NEW DELHI

In the result, appeal filed by the assessee is allowed

ITA 2607/DEL/2019[2015-16]Status: DisposedITAT Delhi13 Mar 2026AY 2015-16
Section 10(38)Section 143(1)Section 143(2)Section 69ASection 69C

observed that his M/s. HPC Biosciences Ltd. is\nalso one such company which was identified as a listed penny stock on BSE\nwhich was used for generating bogus LTCG. By relying on the detailed findings\nin the investigation report of Kolkata, he observed that the investigation made by\nthe assessee ... brought to our notice page\n2 of the assessment order and submitted that the Ld. AO proceeded with\npreconceived notion that it is a penny stock. Further, he submitted that the ssessee\nhas purchased the shares online and sold the same online and submitted that the\nassessee has not involved

VIBHUTI KRUNAL PATEL,SABARMATI vs. ITO WARD 2(1)(2) AHMEDABAD, VEJALPUR

In the result, the appeal of the assessee is allowed for statistical purposes

ITA 1369/AHD/2024[2015-16]Status: DisposedITAT Ahmedabad11 Mar 2026AY 2015-16

Bench: Dr. B.R.R. Kumar, Vice-Shri Tr Senthil Kumar

For Appellant: Shri Vivek Chavda, ARFor Respondent: Shri Abhijit, Sr. DR
Section 115BSection 147Section 148

However, the Department was in possession of information that the assessee had received fictitious profits through trading on BSE in a penny stock namely ACI Infocom Ltd. Therefore, the case was reopened by issuing a notice under section 148 dated 30.03.2021. During the course of assessment proceedings, the Assessing Officer ... furnish the requisite details, clarifications, and explanations in support of the claim pertaining to financial transactions and the sale and purchase of shares in penny stocks. However, despite being granted multiple opportunities, the assessee failed to furnish the requisite details or explanations before the Ld. CIT(A). Consequently

JITENDRABHAI DEVAJIBHAI BODAR,RAJKOT vs. INCOME TAX OFFICER, WARD-2(1)(1), RAJKOT, RAJKOT

In the result, the appeal is dismissed as not admitted”

ITA 549/RJT/2025[2013-14]Status: DisposedITAT Rajkot10 Mar 2026AY 2013-14

Bench: Dr. Arjun Lal Saini & Dr. Dinesh Mohan Sinha

For Appellant: Shri Digant Kiyada, Ld. AR
Section 142(1)Section 147Section 148Section 234ASection 250Section 271(1)(b)

facts as also in law in alleging that appellant earned profit of Rs. 45,44,522/- from purchase and sale of shares of penny stock company and thereby adding the same as income from undisclosed sources. The addition made is totally unjustified on facts as also in law and deserves ... sold 3,57,534 shares at Rs. 2,64,71,610/- and thereby earned profit to the tune of Rs. 45,44,522/-. With penny stock company be not treated as unexplained investment and entire amount be not treated as your income from undisclosed sources for the year under consideration

NRUPESH SHAH HUF,MUMBAI vs. ITO 34(3)(2), MUMBAI

In the result, the appeal is allowed with cost for statistical purposes

ITA 164/MUM/2026[2017-18]Status: DisposedITAT Mumbai09 Mar 2026AY 2017-18

Bench: Shri Sandeep Gosain & Shri Prabhash Shankarnrupesh Shah, Huf V/S. Income Tax Officer, Ward – Flat No. 701, 7Th Floor, बनाम 34(3)(2) Heritage View Building, It Office, Kautilya Bhavan, Dadabhai X Road No. 3, Ville Bkc Bandra East, Parle (West), Mumbai – Mumbai – 400 051, 400056, Maharashtra Maharashtra स्थायी लेखा सं./जीआइआर सं./Pan/Gir No: Aahhn0469H Appellant/अपीलार्थी .. Respondent/प्रतिवादी

For Appellant: Shri Viraj Mehta, ARFor Respondent: Shri Brajendra Kumar (Sr. DR)
Section 147Section 249Section 249(2)Section 68

erred in confirming action of the Ld. Assessing Officer in addition of Rs. 22.95.430/- u/s 68 on account that appellant has traded in penny stock M/s Kushal Tradelinks without considering the submissions made by the appellant. Such addition is bad in law and liable to be deleted, 3. Brief facts

CHHAYA KETAN MEHTA,MUMBAI vs. INCOME TAX OFFICER - 33(1)(3), MUMBAI

In the result, the appeal is allowed

ITA 6543/MUM/2025[2014-15]Status: DisposedITAT Mumbai09 Mar 2026AY 2014-15
For Appellant: \nShri Nishit Gandhi, AdvFor Respondent: \nShri Virabhadra Mahajan (Sr. DR)
Section 10(38)Section 14Section 143(3)

made the\nPage 4\nITA No. 6543/Mum/2025\nΑ.Υ. 2014-15\nChhaya Ketan Mehta\ndisallowance based on report on such penny stock companies by the\nInvestigation wing of the Department in respect of such Kolkata Based\nsham companies. The AO observed that the purchase of shares was off\nmarket. Shri ... action of the AO concluding that he AO\ndoubted genuineness of said transactions but also established how the\nprice of shares of the penny stock companies were rigged and were\nraised through circular trading. It was observed that the whole\ntransaction was pre-conceived resulting in creation of bogus claim

ELARA INDIA OPPORTUNITIES FUND LIMITED,MAURITIUS vs. DEPUTY COMMISSIONER OF THE INCOME TAX (INTERNATIONAL TAXATION) - 2(2)(1), MUMBAI

ITA 5859/MUM/2025[2019-2020]Status: DisposedITAT Mumbai09 Mar 2026AY 2019-2020

grounds are reproduced below:\nITA No.5859/Mum/2025\nElara India Opportunities Fund Limited\n“Ground No. I- The scrip of International Conveyors\nLimited is not a 'penny stock'\n1.1 The learned DCIT failed to appreciate that\nInternational Conveyors Limited was a functioning\ncompany carrying out operations in the usual course ... nbusiness. The learned DCIT failed to appreciate that none\nof the features of a 'penny stock i.e. being closely held,\nhaving no operations, the stock price being unsupported\nby financials was present in the scrip of International\nConveyors Limited. Thus, the learned DCIT erred in\nregarding the scrip of International

SURESH KUMAR PODDAR,KOLKATA vs. I.T.O., WARD - 63(4), KOLKATA, KOLKATA

In the result, appeal of the assessee is allowed

ITA 1542/KOL/2024[2011-2012]Status: DisposedITAT Kolkata06 Mar 2026AY 2011-2012

Bench: SHRI RAJESH KUMAR (Accountant Member)

Section 111ASection 132Section 132(1)Section 139(1)Section 144Section 147Section 148Section 153CSection 250Section 250o

long term and short-term capital gain/loss etc. During the course of search, it was revealed that the accommodation entry in the form of penny stock was arranged by Shri Shirish Chandrakant Shah. Accordingly, the case of the assessee was reopened u/s 147 of the Act by issuing notice

AMPI FINANCE LIMITED,KOLKATA vs. I.T.O., WARD-4(3), KOLKATA

Appeal of the assessee is allowed

ITA 2831/KOL/2025[2012-13]Status: DisposedITAT Kolkata05 Mar 2026AY 2012-13

Bench: the Bench that the re-opening of

Section 143(3)Section 144Section 147Section 148Section 148(2)Section 250Section 69C

Thereafter, the assessment was reopened after the AO received information from DDIT (Inv.) that the assessee company is beneficiary of bogus capital gains/loss on penny-stock and accordingly, the case was reopened u/s 147 of the Act by issuing notice u/s 148 of the Act on 31.03.2019. The assessee complied ... information has been received from Pr.DDIT(Inv.), Unit-3(2), Kolkata, that investigation of M/s Banas Finance Ltd., revealed that it was a penny stock. This company had been used to facilitate introduction of unaccounted income of members of beneficiaries in the form of exempt capital gain or short term

JAYSHREE HARESH SHAH,MUMBAI vs. INCOME TAX OFFICER, 19(2)(1), MUMBAI, MUMBAI

In the result, the appeal of the assessee bearing ITA No

ITA 4206/MUM/2025[2014-15]Status: DisposedITAT Mumbai05 Mar 2026AY 2014-15
Section 10(38)Section 143(2)

interfere. There is a finding of fact by the Tribunal that the transaction of\npurchase and sale of the shares of the alleged penny stock of shares of Ramkrishna Fincap Ltd.\n(\"RFL\") is done through stock exchange and through the registered Stockbrokers. The payments\nhave been made through banking ... Swati Bajaj [2022] 446 ITR 56 (Calcutta) where on same set of\nfacts related taxability of LTCG on sale of shares considered as manipulated penny stock &\nthe\naction of the Id. AO is confirmed. But the related to scrip “Sunrise Asian Ltd” the assessee is\ncovered by the order

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