2010 (3) TMI 1174

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....h Desai. O R D E R PER D. MANMOHAN, VICE PRESIDENT: This appeal by the Revenue is directed against the order dated 20-5-2009 passed by the CIT(A)-II, Mumbai, and it pertains to the assessment year 2005- 06. Facts concerning the only issue in dispute are as under. 2. The assessee company was engaged in the business of purchase and sale of shares. In the Memorandum of Association of the ....

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....o be assessed to tax as short-term/long-term capital gains. The A.O. rejected the contention of the assessee and treated the same as "income from business". On an appeal filed by the assessee, the ld. CIT(A) decided the issue in favour of the assessee by observing in paras 13 & 14 of his order as under : "13. The decision of ITAT, Mumbai as cited by the A.R. have been placed on record and....

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....e and purchase of shares is the same as in the preceding years and on the same merits to be accepted as Short Term Capital Gains. There is also no basis for treating the appellant as trader in shares when his intention was to hold the shares in Indian Companies as an Investment and not as stock-in-trade. The magnitude of the transactions does not change the nature of the transaction, which are bei....

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....d in past. Thus, the income from sale of investments is to be treated as Capital Gains, Long term or Short  term as the case might be, and not as business income. The Assessing Officer is therefore directed to treat the income from sale of investments in the year under consideration as Capital Gains and also allow the Appellant to set off the brought forward-unabsorbed Capital losses As a res....