TaxTMI 
TaxTMI 
TaxTMI 
2016 (10) TMI 347
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....may be treated as income from short term capital gains by explaining that the intention of the assessee is merely investment of all surplus funds in equity shares of domestic companies and no interest bearing funds were invested by the assessee. It was also contended that none of the public limited company, where investment was made, is controlled by the assessee and all the shares are quoted at recognized stock exchange. The learned counsel further explained that all the shares were shown as investment in the balance sheet and the dividend income was shown by the assessee as income from other sources and claimed exempt u/s 10(34) of the Act. The shares were claimed to be routed through demat account and STT tax was paid on sale and purchas....
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....empt. However, the learned Assessing Officer treated the same as business income on the ground that the assessee is earning income by dealing in shares and is routinely involved in share transaction. In reply to the query raised by the learned Assessing Officer, the assessee claimed that she is a housewife and not having any professional knowledge of share market. It was also explained that no loans were taken by the assessee for making the investment in shares and further, the assessee is not indulged in any derivate transactions. The contention of the assessee was not accepted by the Assessing Officer on the reasons stated in the assessment order which broadly are that the assessee is regularly and frequently dealing in shares and is doin....
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..../2009, order dt. 13.4.2011), wherein it was held that large volume of share is not the only deciding factor to hold the assessee a trader. It is also noted that own funds were invested by the assessee and no borrowed funds were utilized, therefore, the decision in Nagindas P. Sheth (HUF) vs. ACIT (ITA No. 961 and 1836/Mum/2010, order dt. 5.4.2011) supports the case of the assessee. It is also noted that the assessee was holding the shares in its books as investment and did not have any office or administrative set up. There was not a single instance where the assessee had squared up the transaction on the same day without taking delivery of the shares. So far as the contention of the Assessing Officer as well as of the Ld. DR that there was....
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....which cannot be brushed aside without proper reasoning. In the earlier assessment year, the Assessing Officer accepted offering of LTCG and also accepted the claim of the assessee in the status of investor. Therefore, without bringing any contrary material/facts, the stand of the Assessing Officer is not permissible. As the modus operandi of the assessee remained the same with respect to other shares, the claim of the assessee cannot be negated only on the basis of frequency of transactions as was held by Hon'ble Jurisdictional High Court in Gopal Purohit (228 CTR 582 (Bom)). The ratio laid down in Smt. Geeta Devi Mahipal vs. ITO (2004) 1 SOT 468 (Jd) supports the case of the assessee. Identical ratio was laid down in Vinod K. Nevatia vs. A....
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....essed as short term capital gain/long term capital gain, as the case may be. 4. So far as the rule of consistency is concerned, we note that in the previous and subsequent assessment years, the Assessing Officer treated the assessee as an investor, therefore, we are of the view that unless and until contrary facts are brought on record by the Revenue, no U-turn is permissible. The learned Assessing Officer is bound by rule of consistency. The following cases support the case of the assessee : i. Parshuram Pottery Works Ltd. vs ITO 106 ITR 1 (SC) ii. Security Printers 264 ITR 276(Del.) iii. CIT vs Neo Polypack Pvt. Ltd. 245 ITR 492 (Del.) iv. CWT vs Allied Finance Pvt. Ltd. 289 ITR 318 (Del.) v. Berger Paints India Ltd. vs CIT....