ITAT Deletes Addition On Availing Accommodation Entries In Shape Of LTCG As It Was Not Recorded In Books Of Accounts

The Indore Bench of Income Tax Appellate Tribunal has deleted the addition of availing accommodation entries in the shape of Long Term Capital Gain as it was not recorded in the books of accounts.The bench of Vijay Pal Rao and B.M. The Indore Bench of Income Tax Appellate Tribunal has deleted the addition of availing accommodation entries in the shape of Long Term Capital Gain as it was not recorded in the books of accounts. Biyani has observed that once the assessee has denied the alleged transaction and it is also not found recorded in the books of accounts, including the Demat account of the assessee maintained by the banks, then the addition made by the AO is purely based on assumption. The tribunal noted that before making the addition on account of bogus long-term capital gains under Section 68 of the Income Tax Act, the AO ought to have ascertained the correct facts about the alleged transaction of accommodation entries for bogus capital gains.