INCOME TAX4 Sept 2026
Taxpayer denied LTCG exemption over suspected share price manipulation after 7,800% jump: How he won the case | Mint
ITAT Mumbai ruled in favour of a taxpayer whose ₹12.62 lakh long-term capital gains exemption was denied after his shares rose nearly 7,800% in three years. Tax officers suspected price manipulation and added the gain under Section 68. The tribunal held suspicion without proof of his role cannot justify the addition. This guidance helps genuine investors facing similar scrutiny. Keep all purchase, banking, and demat records safe.
Key Statutory Highlights
- ITAT Mumbai set aside the ₹12,61,955 addition made against a taxpayer under Section 68.
- The taxpayer's LTCG exemption was denied after tax officers suspected price manipulation following a nearly 7,800% share price jump in three years.
- The tribunal held that suspicion arising from a sharp price rise, without evidence of the assessee's role in manipulation, cannot sustain the addition.
Actionable Advice for Taxpayers / Founders:Preserve all documents showing you bought and sold shares through proper banking channels. If you face similar scrutiny, these records can support your claim, though each case depends on its facts.
Statutory Disclaimer: TaxQue Shorts are AI-assisted editorial briefs for compliance awareness. This brief has not passed every source check; confirm the original notification before acting. This does not constitute formal legal or CA counsel.
TaxQue News Desk
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