TaxTMI 
TaxTMI 
TaxTMI 
2014 (2) TMI 599
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....nd the submission made by the learned counsel for the assessee, we condone the delay of one day in filing the appeal. Also heard on merit of the case. 3. The assessee is objecting in confirming the order of AO, whereby treating the income on account of sale of shares as business income against short term capital gain of Rs.48,92,720/- shown by the assessee. 4. During the assessment proceedings, the AO noticed that the assessee has shown capital gain on account of sale of shares. Details of shares were asked for. After considering the details of sales and purchases, the AO noted that the assessee has shown short term capital gain whereas more than 50% of transactions were having holding period of more than 2 months. The AO also noted that....
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.... the gain on account of sale of shares has to be treated as long term capital gain and if holding period of shares are less than one year then the gain on account of sale of shares has to be treated as short term capital gain. No where it is provided that if the transactions are frequent and voluminous then the claim of the assessee is not allowable as short term capital gain or long term capital gain as the case may be. The only question which is to be examined and seen by the AO as to what treatment has been given by the assessee in respect to purchase of shares. Whether the purchase of shares are shown under the head stock-in-trade or under the head investments. If purchases have been shown under the head stock-in-trade then the sale tra....
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....aterial on record along with the order of the tax authorities below. We have also gone through the case law as has been cited before us. We find that in the case of CIT (Central), Calcutta vs Associated Industrial Development Company (P) Ltd. (82-ITR-586), the Hon‟ble Supreme Court has held as under: "Whether a particular ho/ding of shares is by way of in vestment or forms part of the stock-in-trade is a matter which is within the knowledge of the assessee who holds the shares and he should, in normal circumstances, be in a position to produce evidence from his records as to whether he has. maintained any distinct/on between those shares which are his stock-in-trade and those which are held by way of in vestment." 12.1 In the case o....
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....rket; - Whether the shares have been purchased from the secondary market; - Whether the shares have been purchased by subscription to Public -Whether the shares have been held for fairly long period, and - Whether the shares once sold have never been re- purchased 14. We noted that in the case of CIT Vs V A Trivedi 172 ITR 95 (Born) Hon‟ble jurisdiction High Court has clearly laid down under para 12 of the order that the onus of establishing that a purchase is made with the intention to trade is on the Revenue. 15. We noted that the main contention of the revenue in treating the gain to be the income from business is the number of transactions and the period of the holding by the assessee. The period of the holding and number of....
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....d of the holding cannot be the criteria for determining whether the profit derived by the assessee is a long term capital gain or short term capital gain. 16. The CIT(A), we noted in this case while allowing the appeal of the assessee has relied on the decision of the ITAT Nagpur bench in the case of Dineshbhai C. Patel (HUF) in 1TA No.616/2008, which confirmed the decision of the C1T(A), the copy of the decision was filed before us. The appeal against the decision of the Nagpur Bench in the case of Dineshbhai C. Patil (supra) has been dismissed by the High Court vide order dated 28 10 2010 holding that no substantial position arise and the Tribunal, on the basis of the material on record, hold that the shares were purchased by the assesse....
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.... Gopal Purohit Vs. JC1T 20 DTR 99 (Mumbai) were also the same as in the case of the assessee. In all those cases, the Tribunal took the view that period of holding cannot be the basis to determine whether the share transaction entered into by the assessee is a business income or capital gain. In this case also, we noted that the assessing officer has built up his case mainly on the basis o period of holding and on that basis, he took the view that the shares held for a short period or for a number of days would not be capital gain. In our opinion, no interference is called for in the order of the CIT(A). The CIT(A) has rightly taken the view that the decision of this Tribunal in ITA No.616/2008 in the case of ACIT Vs. Dineshbhai C. Patel (H....