TaxTMI 
TaxTMI 
2014 (1) TMI 1707
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.... CIT (A) erred in observing that the activity of purchase and sale of shares / units is adventure in the nature of trade and the income from the same is "business income" as against "capital gain" offered by the appellant, without appreciating that it is the intention to carry out a transactions is determinative of the character of the income. 3. The CIT (A) erred in concluding that the appellant is engaged in trading in shares / units, without appreciating that the shares were acquired and held as "investments" and not as "stock-intrade" and the delivery of the shares is duly taken. 4. The CIT (A) failed to appreciate that merely because the appellant is maintaining a diversified portfolio of equity, mutual funds etc., does not lead to t....
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....t different dates. However, there are no re-entered transactions in same of the mutual funds. In this regard, Ld Counsel brought our attention to various decisions to support that the surrender of mutual funds units cannot constitute a business activity considering the fact that the sale consideration realised on the sale of mutual funds are re-invested in other mutual funds and therefore, the investment activity thus continues. Such transactions should not be deemed as a business transactions and the surrender of units to the fund managers cannot be equated with the sale transactions. In this regard, Ld Counsel heavily relied on the decision of the Coordinate Bench of the Tribunal in the case of Bombay Gymkhana Ltd. vs. ITO [2008] 115 TTJ ....
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.... the AO as business income. In this regard, Ld Counsel brought our attention to page 25 of the paper book and mentioned that assessee has dominant object of investment activity in buying the impugned shares. The fact that the said shares were purchased out of own funds was also demonstrated by bringing our attention to the copy of the relevant balance sheet placed at page 1 of the paper book. Further, he also mentioned that the assessee‟s claim in such transactions in the past was accepted by the Revenue without any change. Therefore, considering the „principles of consistency' as held by the Hon‟ble Supreme Court in the case of Gopal Purohit, the assessee‟s claim in this year also should not be disturbed. Further, r....