This article provides a detailed review of the Income Tax Appellate Tribunal’s decision in the case of Bindu Garg vs. Income Tax Officer, Ward-39(4), New Delhi, referenced as ITA No. 1168/DEL/2019. This case involves allegations of bogus long-term capital gains (LTCG) and examines the intricacies of tax evasion schemes.
The appellant, Bindu Garg, was involved in transactions that were scrutinized under the assessment year 2014-15. The primary contention revolved around the legitimacy of long-term capital gains claimed on the sales of shares, which were alleged to be part of a broader scheme to evade taxes.
The assessing officer (AO) challenged the authenticity of the transactions, suggesting that they were structured to camouflage unaccounted income as exempt LTCG through penny stocks. The case delved deep into the mechanics of such transactions, highlighting the role of stock brokers and other intermediaries.
The tribunal analyzed the evidence presented, including transaction trails and broker statements. Contrary to the AO’s claims, the tribunal found that the transactions were executed through proper channels, with all regulatory compliances in place, thereby dismissing the notion of them being mere paper transactions.
The tribunal’s decision to overturn the assessment order underscores the importance of substantive evidence over mere assumptions in tax litigation. This case sets a significant precedent on how similar cases should be approached, particularly those involving complex financial instruments.
The case of Bindu Garg vs. ITO Ward-39(4) offers crucial insights into the judicial process concerning tax assessments of capital gains and serves as a reference point for future cases involving allegations of bogus LTCG.
Detailed Review of Bindu Garg vs. ITO, Ward-39(4), New Delhi in ITA No. 1168/DEL/2019
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