ITA No. 261/Mum/2017. Case: Mr. Shailendra Nahar Vs ITO 25(2)(3). ITAT (Income Tax Appellate Tribunal)
| Case Number | ITA No. 261/Mum/2017 |
| Counsel | For Appellant: Shri R.S. Khandelwal, Adv. and For Respondents: Miss Bharti Singh, Adv. |
| Judges | Shri B.R. Baskaran (AM) |
| Issue | Direct Tax |
| Judgement Date | May 03, 2017 |
| Court | ITAT (Income Tax Appellate Tribunal) |
Order:
-
The assessee has filed this appeal challenging the order dated 13-10-2016 passed by Ld CIT(A)-44, Mumbai for assessment year 2010-11, wherein he has confirmed the assessment of Short term capital gain arising on sale of shares as business income of the assessee.
-
The assessee is deriving income from brokerage & commission, rent, dividend, interest and capital gains. During the year under consideration, he declared short term capital gains as well as long term capital gains arising from sale of shares. The assessee has also held certain shares as stock in trade and has declared business income there from. The AO held that the short term capital gains declared by the assessee should be treated as business income of the assessee, since
(a) The volume and quantity of trade were high.
(b) holding period of shares was less
(c) activities are carried on continuously and recurring in nature
(d) income from share transactions is major livelihood and
(e) the assessee has spent majority of time in share trading activity. Accordingly he assessed the short term capital gains as business income of the assessee.
The Ld CIT(A) also confirmed the same and hence the assessee has filed this appeal.
-
The Ld A.R submitted that the assessee has not used borrowed funds for investing in shares. He further submitted that the majority of shares have been held for a reasonable period. He submitted that the assessee has been classifying shares as "Stock in trade" and "Investments" at the time of making purchases itself. He submitted that a person can act both as trader and investor. At the year end, the shares have been valued at Cost only. He further submitted that the assessee has earned Short term capital gain of Rs.16.16 lakhs in one Scrip named M/s Gangotri Iron and those shares have been held for an average period of 7 months. He submitted that the aggregate amount of net Short term capital gains declared by the assessee was Rs.14.35 lakhs, meaning thereby the entire amount mainly represents gain realized on sale of M/s Gangotri Iron shares. He submitted that the in the assessment years 2006-07 and 2007-08, the short term capital gain declared by the assessee has been accepted by the AO u/s 143(3) assessments. In AY 2009-10, the same has been accepted u/s 143(1) of the Act. He further submitted that the long term capital gain declared by the assessee during the instant year has been accepted by the AO. He submitted that the AO had made identical...
To continue reading
Request your trial