TaxTMI 
TaxTMI 
2015 (4) TMI 149
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....ng that assessment of Short Term Capital Gain as Income from Business is in order. 2. Whether on the facts and circumstances of the case, was it appropriate for the Commissioner of Income-Tax (Appeals) to draw inference that the period of holding of shares is the basic yardstick for determination of either investment or dealing in shares. 4. That the appellant craves leave to add, alter, and or prefer additional grounds and to submit relevant papers at the time of hearing of appeal." 3. The assessee is a Non Banking Financial Company and also deals in shares. The assessee carried on business in share trading and also makes investments in various companies. The assessee is not maintaining any se....
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.... a large number of shares in the assessment year 2008-09 and sold at regular intervals of M/s. Gujarat NRE Coke only The assessee has been showing this as investments during the current year. The assessee has been making investments in M/s. SAL Steel and M/s. Shaw Alloys Ltd. without any sale. The investments have increased form Rs. 9,12,168/- to Rs. 10,39,61,058/- out of which the assessee has bought shares of M./s. Shaw Alloys amounting to Rs. 82,13,669/-. The assessee has started buying shares of M/s. Shaw Alloys since 05.03.2008. The investments have increased from Rs. 5,53,59,458/- to Rs. 21,04,61,058/-. The assessee has investments of unquoted shares amounting to Rs. 7,45,00,000/- all purchased on face value of Rs. 10 each. The value ....
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.... 22. These periodic transactions, selecting the time of entry and exit in each scrip, called for regular direction and management which would indicate that it was in the nature of trade; repeated transactions, coupled with the subsequent conduct of the assesses to re-enter the same scrip or some other script, in order to take advantage of market fluctuations lent the flavor of trade to such transactions; the assessee was purchasing and selling the same scrips repeatedly; the dominant impression left on the mind was that the assessee had not invested in shares; mere classification of these share transactions as investments in the assessee's books of accounts is not conclusive; the intention of the assessee at the time of purchase....
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..... CIT(A) has erred in holding that the short period for which shares have been held, would lead to inference that these are trading transactions. He submitted that there is no such provision in the Act or any circular issued by the CBDT which prescribe minimum holding period of shares in order to qualify them as investments. He further submitted that for making the investment the assessee companies board has duly passed a resolution. On the other hand, the ld. DR relied upon the orders of the authorities below. 7. We have carefully heard both the counsel and perused the records. Before proceeding further we may gainfully refer to some of the germane case laws in this regard. "(a)Whether a transaction of sale and pur....
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....e ITAT Bench "G" of Mumbai in the case of Wallflort Financial Services ltd. vs. Additional Commissioner of Income-tax Range 4(2), Mumbai in IT Appeal No.IT Appeal Nos. 847 and 2468(Mum) of 2009 for Assessment Year 2005-06 reported in [2010] 41 SOT 200 (Mumbai) has observed that the various factors which need to be considered in understanding the intention or the nature of transaction are "frequency and volume of transactions, nature of entry in the books of account, the object clause in the memorandum of association authorizing such transaction, circumstances such as organized efforts made to earn income as well as loans and borrowings which are normally associated with a business activity, profit motive etc. However, no single factor is co....