AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2017 (12) TMI 1357
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....bmissions canvassed across the bar, it is necessary to make a reference to the factual aspects of the case. We may note here that both the Appeals are filed by legal representatives of the original assessee who is no more. 4. As far as Assessment Year 2007-08 is concerned, the assessee claimed Short Term Capital Gains (in short 'STCG') of Rs. 3,44,93,842/. The order of the Assessing Officer records that during the course of assessment proceedings, the assessee was asked to furnish details of the claim of STCG along with the supporting documents. Accordingly, the documents were furnished by the assessee. The Assessing Officer in his assessment order has set out the details of the transactions in shares throughout the year. He came to the conclusion that the assessee had made delivery based transactions in over 41 different scrips not once but generally a number of times. He came to the conclusion that the entire amount of Rs. 3,44,93,842/claimed as STGC should be treated as business income. Being aggrieved by the said order, the assessee preferred an appeal before the Commissioner of Income Tax (Appeals) (for short 'CIT(A)'). The said appeal was allowed by judgment....
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....been uniformity in treatment and consistency when the facts and the circumstances are identical, particularly in the case of the same assessee. He also invited our attention to the Circular dated 29th February, 2016. He relied upon other decisions of the Apex Court including the decision in the case of Radhasoami Satsang v/s. Commissioner of Income Tax (1992) 60 Taxman 248 (SC) and in particular what is held in paragraph 13. He submitted that the Appellate Tribunal as far as Assessment Year 2007-08 is concerned has considered only one factual aspect namely that out of 86 transactions, the holding period in respect of 42 transactions was only upto 7 days. He submitted that in the case of remaining transactions, the holding period is much larger extending to 244 days. He urged that entire material as regards the sale and purchase of shares was placed before the Assessing Officer for both the years. However, there is no application of mind to the said material by the Appellate Tribunal. He pointed out that for the Assessment Year 2008-09, the Assessing Officer and CIT(A) accepted the claim of the assessee of STGC in respect of transactions of shares which were held for more than 30 d....
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....assessee to maintain two separate portfolios, one relating to investment in shares and another relating to business activities involving dealing in shares. The Tribunal held that the delivery based transactions in the present case, should be treated as those in the nature of investment transactions and the profit received therefrom should be treated either as short term or, as the case may be, long term capital gain, depending upon the period of the holding. A finding of fact has been arrived at by the Tribunal as regards the existence of two distinct types of transactions namely, those by way of investment on one hand and those for the purposes of business on the other hand. Question (a) above, does not raise any substantial question of law." (emphasis supplied) 11. Therefore, an assessee who is dealing with the shares and stocks can validly maintain two separate portfolios one relating to investment in shares and the another relating to business activities involving the shares. Thus, what follows is that the Assessing Officer will have to go into the transactions of sale and purchase and will have to determine which are relating to the investment in shares and which are ....
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.... during the year. The holding period of the transactions varies from one day to 244 days. Out of 86 transactions, the holding period in respect of 42 transactions is upto 7 days. Thus, it is clear that about 50% of the total transactions of sale of share during the year, the holding period is only upto 7 days. Further, as pointed out by the Assessing Officer that the assessee has carried out repetitive transactions of purchase and sale in the same scrips e.g. the shares of Aurobindo Pharma were purchased on 21.4.2006 and then sold on 27.4.2006 and thereafter again purchased on 22.5.2006 and resold on 24.5.2006. Thus, the repetitive transaction in the same scrip shows the assessee's intention of purchase of the shares for resale purposes and book profits at the earliest occasion. The holding period is upto one week as far as 42 transactions out of 86 transactions clearly show that the assessee is earning profit by taking advantage of the volatile market condition and thus it cannot be said that the transactions carried on 42 occasion were with the intention to hold these shares for enjoying of the ownership and yielding of dividend income. Further, the assessee is also engaged i....
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....s. The Appellate Tribunal held that the holding period is one of the several factors which is required to be taken into consideration. It concurred with the view taken by the CIT(A) in paragraph 8.1. Thus even after finding that the formula adopted by the CIT(A) based on holding period of 30 days was erroneous, the Appellate Tribunal has not gone into the details of all the transactions. There are two reasons given by the Appellate Tribunal. First reason is that the claim in the sum of Rs. 1,08,74,670/has been accepted by both the Assessing Officer and CIT(A). The second reason given is that in view of the reasons given for the Assessment Year 2007-08, there was no merit in the appeal of the Assessment Year 2008-09. In our view, after accepting that the formula of 30 days adopted by the CIT(A) was erroneous, the Appellate Tribunal ought to have considered the appeal on merits. The learned counsel appearing for the respondent Revenue tried to contend that the details of the sale and purchase transactions for the Assessment Year 2008-09 were not furnished to the Assessing Officer. The said submission appears to be factually incorrect as can be seen from the order of the Assessing O....