Share's profit is Short trem capital gain or Business income

[Devedra Kumar]

My Client is an employee in share broker company and doing transaction with shares in larges volume. And ITR filed on the base of Capital Gain. It any one have any case law regarding this situation please reply..

[Mukesh Kumar]

There are many case laws governing this issue. A careful search in case lasws would help you a lot. Based on the various decisions, I can say that it is an issue which is based on facts and intention of the assessee.

As long as assessee is able to demanstrate that the purpose of buying shares was investment, he can claim the same as capital gains. But otherwise it may be treated as business income.

Therefore, all is depend upon the scope and intention.

AI Summary

Characterisation of share profits as capital gains or business income depends on the assessee's intention and transaction facts. Characterisation of profits from share dealings as short term capital gains or business income depends on the factual matrix and the intention of the assessee; employment in a brokerage and high trading volume are relevant but not conclusive, and classification requires evidence of investment purpose versus a businesslike trading pattern.