2016 (2) TMI 371

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.... 2. Whether on the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in treating the transaction of purchase and sale of shares as Short Term Capital Gain instead of Business Income ignoring the landmark judgment of Hon. ITAT IN THE INCOME TAX APPELLATE TRIBUNAL "F" BENCH, MUMBAI in the case of Veena S. Kalra, Mumbai v/s Department of the Income-Tax, ACIT 16(1), Mumbai delivered on 10th July, 2013 bearing I.T.A. No. 2403/M/2012 (Assessment Year:2008-09)." 2. Appellant is an individual. The return of income for the year under appeal was filed on 13.10.2010 declaring total income of Rs. 25,76,970/-.Assessment u/s 143(3) was completed by the Ld. Assessing Officer determining the total income at Rs. 52,38,980/-. As....

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....her hand, the Ld. Authorized Representative supported the order of CIT(A). 3. After going through rival submissions and material on record, we find that Assessing Officer has treated the short term and long term capital gain from shares as business income. Assessee is HUF and its Karta's main activity is of Property development and that he is neither a share broker nor share dealer. Assessee earned considerable amount of short term capital gains from the shares held by him for a period more than one month and there was no churning of shares as stated by assessee. Assessing Officer has picked up only a few transactions wherein the holding period was a few days, ignoring the majority of transactions. As regards long term capital gain offered....

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....d regular of trading activity since maintaining the books and organizing the records is necessary for evaluating its investment activities in share. Assessee has been following a consistent method of showing investments in his balance sheet. Assessee has shown the speculation profit and profit and loss account investment activity separately and there is no mix up of his business with that of the investment activity. 5. Thus, the portfolio held by the appellant when considered in the light of number of scrips held/purchased/sold and corresponding number of transactions, number of days transacted in market, lack of frequency of transactions, consistent valuation of shares at cost value, separation of speculation/F&O business from investment ....