TaxTMI 
TaxTMI 
TaxTMI 
2016 (7) TMI 159
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....59,15,398/', disclosed as Long Term Capital Gain and Short Term capital Gain, respectively, by the assessee but held as business income by the A.O., as Long Term Capital Gain and Short term Capital Gain without appreciating the facts mentioned by the A.O? 2. Whether on the facts and circumstances of the case, the Ld. CIT(A) erred in holding that the A.O has not applied the principles laid down by the CBDT in Circular No. 4/2007 ? 3. Whether on the facts and circumstances of the case, the Ld. CIT(A) erred in holding that the magnitude of transaction is not relevant for determining the profit from sale of shares/ MF as business income or L TCG/STCG? 4. Whether on the facts and circumstance of the case, the Ld. CIT(A) erred in holdin....
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....all the shares as income from business and profession keeping the volume of business and percentge of income from trading in shares and mutual fund to the total income as basis. The Ld. AO held that the main activity of the assessee is trading in shares, and during the year, 60 transactions in shares were shown as capital gain. The volume of business, the volume of income from capital gain and the volume of investment indicates that trading in shares and mutual fund is the core activity of the assessee. The AO also noted that the time gap between purchase and sale of shares is very thin. The principle of consistency as argued by the assessee is not acceptable in view of the fact that, by paying capital gain and not business income for the s....
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....treated as business income. 6.3 On the contrary, Ld. A.R. submitted that during the year under consideration, the assessee has sold only shares relating to Hindustan Construction and GMR Infrastructure. The remaining has been continued to be held as investment in the books of accounts, maintained by the assessee. Ld. A.R. submitted that the assessee is deriving income from business from capital gain and income from other sources which are as follows: Particulars Asset type Amount Income from business Trading in units of Mutual funds Income from interest Incentive and Miscellaneous income 13232997/- Income from capital gains Income from capital assets Investment in Equities LTSCL (STT paid 5580788/- exempt u/s 10(38) STCG-15915398/-....
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.... that the bulk of shares held by the assessee were form substantial period. The objective of the assessee is to get substantial capital gain and not earning profits which would result in transaction being in nature of trade. Further it is observed that the method of valuation adopted by the assessee is at cost price on a permanent basis and not on ad-hoc basis. From the list of shares submitted before us, it is observed that the assessee has been holding the shares as investment from year to year. The treatment given to the transaction in the books of accounts is of importance, and the assessee has treated these shares and sale thereof as investment. It is observed that the assessee has been maintaining the clear distinction among its holdi....
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....rchase and sale and period of holding of shares, it is observed that the assessee has held 11 transactions of shares for more than 50 days and the balance were held for more than 100 days in total number of 30 transactions. In the previous year and the subsequent years relevant to the Assessment Year under consideration the Department has been consistently accepting the investment in shares held by the assessee. During the year under consideration, the assessee has sold shares of two companies being Hindustan Construction and GMR Infra Structure. The remaining shares relate to purchases made in the previous years. 10. The judicial pronouncements discussed above clearly indicates that; (i) Whether particular trading is from 'investment....