TaxTMI 
TaxTMI 
2015 (7) TMI 798
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....eated as short term capital gain and if the holding period is less than one month then it should be treated as business income. The direction given is contrary to law, therefore, order of CIT(A) may be set aside and order of A.O. be restored. 3. On the facts and circumstances of the case and in law, the Ld CIT(A) erred in deleting proportionate expenses of Rs. 8,16,667/- out of total expenses of Rs. 11, 12,377/- as assessee has claimed all expenses against short term capital gain only and not a single rupee was attributed to Long Term Capital Gain which is claimed exempt U/s.1 0(38) of the Act. 4. On the facts and circumstances of the case and in law, the Ld CIT(A) erred in giving direction to re-examine and compute 14A disallowance without appreciating the facts that the disallowance was computed as per the provisions of section 14A r.w. Rule 8D and therefore, it is prayed that the order of CIT(A) may be set aside and order of A.O. be restored. 5. The appellant prays that, the order of the CIT(A) on the above ground be reversed and that of the Assessing Officer be restored. 6. The appellant craves leave to amend or alter any grounds or add a new ground, which may be necess....
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....on, that fair rent could be ascertained by investigating the rent by placing similarly placed properties.The FAA relied upon the cases of Sheila Kaushik (131 ITR 435) and Dewan Daulat Rai Kapoor (122 ITR 700) of the Hon'ble Supreme court. She also referred to the cases of Ashwin Adekar (ITA/1867/Mum/2006) dt.11.7.08, Reliance commercial corpn.,(ITA 2035/Mum/98)dt.1.212.03,Park Paper Industries Ltd.(ITA 1239- 1242/Mum/08 dt. 28.08.08).Finally,she held that property for property not let out Municipal value should be adapted to determine ALV and directed the APO to re-calculate the income from house property by adopting the standard rent/municipal value as yard stick. 2.3.Before us,Departmental Representative(DR)supported the order of the AO.Authorised Representative(AR)relied upon the order of the FAA.We have heard the rival submissions and perused the material before us. We find that the AO had determined the ALV without any basis.The FAA has given a categorical finding in that regard and has held that no investigation had been done to ascertain the actual fair rent of the property.The FAA has relied upon the judgment of Hon'ble Apex Court delivered in the case of Sheila Kaushik(s....
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....e assessee contended that she had maintained regular books of account wherein two portfolios were maintained,that she was having investment portfolio,that the investment portfolio comprised the securities which were treated as capital assets, that she was also maintaining trading portfolio comprising of stock-in-trade that were treated as trading assets, that she herself had bifurcated the entries and had offered the resultant profits/loss on the sale of shares as business income/LTCG/STCG separately, that she was an investor in shares and securities since last several years, that the transactions of sale and purchase of shares had been charged with security transaction tax, that she had diversified investments, that diversification did not mean that the assessee had treated investment as stock in trade or had carried out business.Referring to circular No.4/2007 dt.15.6.07 the assessee further contended that he was making investment in shares since 1997 and had disclosed shares/ debentures as investment in the balance sheet consistently since then,that the valuation of the assessee was accepted by the AO in the earlier years,that the intention of the assessee had to be seen from th....
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....ssee's own case for AY 06-07 (ITA 5655/Mum/2009) dt.4.11.2022. We have heard the rival submissions and perused the material before us. We find that the tribunal has mentioned the facts of the case for the AY 06-07 as under: "2. The assessee in the present case is an individual who filed the return of income for the year under consideration on 16-10-2006 declaring total income of Rs. 2,91,69,761/-. The said income comprised of short term capital gains of Rs. 2,28,16,373/- and income from F & O and speculative transaction of Rs. 64,29,182/-. The assessee had also declared long term capital gains ofRs.1,17,41,141/- arising from sale of shares which were claimed to be exempt u/s.10(38). The income earned by the assessee from the dealing in future and option transactions was declared by her as business income and the profit earned from delivery based transaction in shares was declared as capital gains. During the course of assessment proceedings, the assessee was called upon by the Assessing Officer to explain as to why the profit arising from transactions in shares shown under the head "Capital Gains" should not be treated as her business income. In reply, elaborate submission was mad....
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....his issue. She relied on the following decisions of the Tribunal stating that in the similar facts and circumstances as involved in the assessee's case, profit arising from purchase and sale of shares has been held to be business income of the assessee: i) Shailesh L. Shah vs. DCIT ITA No. 3991 & 3992/Mum/2008; dated 13th July, 2010. ii) ACIT vs. Mr. V. Nagesh ITA No. 5410/Mum/2008; dated 24th Sept.,2009. iii)Smt. Sadhana Nabera vs. ACIT; ITA No. 2586/Mum/2009,dated 26th March,2010. iv) Sarnath Infrastructure (P) Ltd. vs. ACIT 120 TTJ (Lucknow) 216. 7.The learned counsel for the assessee, on the other hand, submitted that the profit arising from sale of shares was declared by the assessee as short term capital gain and long term capital gain depending on the period of holding. He submitted that the short term capital gains as well as long term capital gains declared by the assessee was treated by the AO as her business income and the learned CIT(Appeals) while disposing of the appeal of the assessee vide his impugned order has directed the AO to accept the treatment given by the assessee to the profits arising from sale of shares as short term capital gains and long term capi....
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....t relied upon by the learned CIT(Appeals) to decide the issue in favour of the assessee, he submitted that the said decision has been upheld even by the Hon'ble Bombay High Court and even the SLP filed by the Department in that case has been dismissed by the Hon'ble Supreme Court. He cited various decisions of the Tribunal stating that a similar issue has been decided therein in favour of the assessee following the rule of consistency. The Tribunal decided the issue against the AO in para-08-09 which reads as under: 8.We have considered the rival submissions and also perused the relevant material on record. The issue involved in the present appeal is whether the shares sold by the assessee during the year under consideration giving rise to short term capital gains were purchased and held by her as investment or stock in trade. If they were purchased and held by the assessee as investment, the profit arising from sale thereof would be chargeable to tax in the hands of the assessee under the head "Capital Gains" whereas if the same were held by her as stock in trade, the profit arising from sale thereof would be chargeable to tax in the hands of the assessee under the head "Profit....
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....nsideration.This is because if the Department has accepted that some of the shares were purchased and held by the assessee as investment while accepting the decision of the learned CIT(Appeals) allowing the claim of the assessee for long term capital gain arising from sale thereof, there is no justification for them to contend that the assessee had purchased and held other shares as stock in trade merely because they were sold within a period of one year especially when other facts relevant theretoare almost similar. For instance, if one lot of 1000 shares of a particular company was purchased by the assessee in the earlier year and 500 shares of the said lot were sold by her in the year under consideration before a period of one year andthe balance 500 shares were sold again in the year under consideration but after the period of one year, it cannot be said that there were two different intentions of the assessee behind purchase of the same lot of shares. The intention of the assessee in such case cannot be different and the same in any case, cannot be decidedmerelyon the basis of period of holding especially when other material facts relevant to the issue are similar. Moreover, t....
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....the above conclusions. The AO had without making any enquiry about the nature of expenses and the number of transactions of LTCG made an addition of Rs. 8,61,667/- . We find that the FAA had deleted the disallowance as she was of the opinion that adhoc disallowance should not be made.In our opinion, considering the facts and circumstances of the case the order of the FAA does not suffer from any legal infirmity.So,confirming her order we decide ground No.3 against the AO. 5.Last ground of appeal is about direction given by the FAA to re-compute disallowance u/s.14A of the Act.During the assessment proceedings,the AO found that the assessee had received exempt income that she had not disallowed any expenditure related to exempt income. He held that from the books of account maintained by the assessee it was not possible to ascertain the amount of expenditure directly related to the exempt income.The AO directed the assessee to submit the computation of income as per Rule 8D of Income tax Rule 1962 (Rules).The assessee calculated the disallowance at Rs. 1.30 lacs. The AO held that the assessee had not computed 0.5% of the investment for making the disallowance. He calculated the dis....