Loss from genuine share trades on recognized stock exchange, verified by demat and bank records at prevailing market prices, cannot be disallowed merely for lack of business prudence or year-end booking against profits.

आदेश/ORDER

PER VIJAY PAL RAO, V.P. :

This appeal by the assessee is directed against the Order dated 29.06.2018 of the learned CIT(A)-6, Hyderabad, for the assessment year 2014-2015.

2. The assessee has raised the following grounds of appeal:

1. “On the facts and in the circumstances of the case the appellate order passed by the CIT(A) is erroneous both on facts and in law to the extent the C order is prejudicial to the interest of the appellant.

2. The Ld. CIT(A) erred in upholding the order passed by the Ld.AO in making the disallowance of loss on sale of delivery based shares amounting to Rs.6,41,12,159/- which is not correct and bad in law.

3. The Ld. CIT(A) ought to have appreciated the fact that the above loss of Rs.6,41,12,159/- is incurred in course of regular business of the assessee, purely out of business exigency and the same is allowable.

4. The Ld. CIT(A) ought to have appreciated that the assessee, being a trader in scrips and shares has made all the purchases and sales on BSE which is regulated by SEBI through a registered broker only.

5. The Ld. CIT(A) ought to have considered the fact that the assessee has purchased and sold the shares accordingly through Recognised SEBI which confirms the validity and genuineness of the transactions made by the assessee.

6. The Ld. CIT(A) erred not considering the fact that the share sold were acquired in earlier years and the AO has not doubted the purchase of shares.

7. The Ld. CIT (A) ought to have considered the various evidences filed by the assessee in the form of Bank Statements, Details of shares purchased, Share Bills, Statement of Accounts, Ledger copies about the existence, genuineness of the sales and purchases made during the year under consideration.

8. The Ld. CIT(A) ought to have appreciated the fact that the transactions were done through recognised stock exchange in electronic platform and all transactions were routed through DEMAT account and banking channels and Securities Transaction Tax on the above transactions were paid u/s 111A of the Income Tax Act, 1961.

9. The Id CIT(A) ought to have appreciated the fact that the AO has not doubted the purchase of shares in D-MAT Form agency, hence sale cannot be bogus.

10. The Id CIT(A) ought to have appreciated the fact that the sale transaction between the appellant and the other party was not a pre-arranged transaction, hence the AO cannot be deny the same sale transaction.

11. The Ld. CIT (A) erred in not considering the submissions made by appellant which is not correct, is against Natural Justice and is not justified.

12. The Ld. CIT(A) ought to have appreciated that the book value of the shares does not reflect the market price and the assessee had to sell the shares at a very lower price in order to ensure no further loss is incurred.

13. The Ld. CIT (A) ought to have appreciated the fact that there is no mention in the order that there is nexus between the assessee and the party who purchased the share through stock exchange.

14. The Ld. CIT(A) ought to have followed the judgement of jurisdictional High Court in I.T.T.A.No. 490 of 2014 dated 30.07.2014 in the case of CIT-V, Hyderabad v. Smt. Aarti Mittal and ought to have held that the share transactions of the appellant are genuine.

15. The CIT(A) ought to have appreciated the fact that the Ld. AO cannot sit in the arms chair of the assessee.

16. The Ld. CIT(A) erred in enhancing the income of the assessee by an amount of Rs.1,45,00,001 which is beyond the powers of CIT(A).

17. The assessee may add, alter or modify any other points to the grounds