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2015 (9) TMI 970 - HC - Income TaxGains from Share Transactions - Short Term Capital Gain OR Business Income - Held that - On examination of all the facts it has inter alia come to the conclusion that the activities carried out by the respondent assessee cannot be classified under the head business income but more appropriately as claimed by the respondent assessee under the head short term capital gains . This is particularly so on application of CBDT circular. This finding of fact by the CIT (A) has been upheld on examination by the Tribunal. In view of the concurrent finding of fact arrived at by the CIT (A) and the Tribunal, according to us, no substantial question of law would arise to warrant admission of the question as proposed. It is to be noted that even according to the Revenue, there can be difference of opinion on the appreciation of facts. If that be so, the CIT (A) and the Tribunal has taken a particular view which is not shown to be perverse or arbitrary in the context of the facts. The view taken is a possible view on the facts and therefore, calls for no interference. Thus we see no reason to entertain the question as proposed. - Decided against revenue.
Issues:
- Challenge to the order of the Income Tax Appellate Tribunal regarding the treatment of gains from share transactions as short term capital gains instead of business income. Detailed Analysis: 1. The appeal under Section 260A of the Income Tax Act, 1961 challenges the Tribunal's order dated 27th February, 2013, regarding the Assessment Year 2008-09. The main question raised by the Revenue was whether the gains from share transactions should be treated as short term capital gains or business income. 2. The respondent-assessee, a senior citizen, had income from capital gains, business income, and other sources. The Assessing Officer considered the claimed short term capital gains of Rs. 9.25 crores as business income due to various factors such as dealing with shares of over 60 companies, short holding periods, speculative transactions, and low dividend income. Consequently, the assessee was taxed under the head 'business income'. 3. In the appeal before the Commissioner of Income Tax (Appeals) (CIT (A)), it was argued that the assessee had consistently treated shares as investments, not stock-in-trade, and had earned 75% of income as short term capital gains by holding shares for over nine months. The CIT (A) found that the shares were held as investments based on various criteria, including compliance with CBDT circular, and allowed the appeal, treating the income as short term capital gains. 4. The Tribunal upheld the CIT (A)'s decision, noting that the facts were similar to a previous case involving the assessee's son, where gains from share transactions were treated as short term capital gains. The Tribunal found no reason to interfere with the CIT (A)'s decision, leading to the dismissal of the Revenue's appeal. 5. The Revenue argued for admission of the appeal, claiming a different perspective on the facts compared to the CIT (A) and the Tribunal. However, the High Court found that the CIT (A) and Tribunal had considered all relevant facts and applied the law correctly. The decision to treat the income as short term capital gains was upheld as a possible view on the facts, not warranting interference. 6. The High Court also addressed the Revenue's argument regarding the decision not to appeal a previous case involving the assessee's son. It emphasized the need for consistency in the department's approach to similar cases unless substantive reasons exist for a different view. The lack of substantial differences in facts between the cases led to the dismissal of the appeal. 7. Ultimately, the High Court found no grounds to interfere with the Tribunal's decision, as the CIT (A) and Tribunal had correctly analyzed the facts and applied the law. The appeal was dismissed with no order as to costs.
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