2015 (5) TMI 616

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....ing Officer. 2. Briefly stated the facts of the case are: The respondent-assessee Company is engaged in the business of finance and films. For the assessment years 2006-2007 and 2008-2009, the assessee had invested money in shares through the Portfolio Management Scheme of M/s.Kotak Securities Limited. Since there were regular transactions of sale and purchase of shares, the Assessing Officer, for the relevant assessment years, held the same to be 'business income'. Challenging the same, the assessee filed appeals before the Commissioner of Income Tax (Appeals), which were allowed. Against the orders of the Commissioner of Income Tax (Appeals), the Revenue filed appeals before the Income Tax Appellate Tribunal. In the first round,....

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....fits by purchase and sale of shares after availing loan of Rs. 60 lakhs for dealing in shares during the year should also be treated as part of the trading activity?" 5. The contention of learned Counsel for the appellants is that since the assessee had employed the services of a Portfolio Management Scheme for carrying on the sale and purchase of its shares, and had derived huge profits because of regular transactions, the same could be termed as nothing else but business of the assessee and thus, such income derived from the sale and purchase of shares should not be given the benefit of 'short term or long term capital gains', but should be assessed as 'business income'. 6. He has further submitted that for carrying on s....

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....made by the assessee in shares could be termed as 'income from business' or 'income from capital gains'. 9. Sri K.K.Chythanya, learned Counsel for the respondent has also submitted that merely because some loan had been taken for investment in shares will not mean that the same would become business of the assessee, as there is nothing in law which prohibits purchase of shares for investment purpose after taking loan. 10. As regards the first question that merely because of employment of Portfolio Management Service for investment in shares, the same would become business income, we are of the opinion that the said issue has been dealt with at length by the Delhi High Court in the case of Radials International (supra), whe....