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TMI Blog2013 (8) TMI 533X X X X Extracts X X X X X X X X Extracts X X X X ..... fficer instead of Long Term Capital Gains and Short Term Capital Gains shown by the assessee. 3. The relevant facts in brief are that the assessee is a non-banking finance company and is having income from sale of shares, dividend income and profit on sale of investment. The assessee has filed return of income showing income of Rs. 22,64,696/-, which included income from profit and gain of business, long term and short term capital gains, income from house property and income from other sources. During the course of assessment proceedings, the Assessing Officer observed that during the relevant assessment year, the assessee has purchased and sold 2,55,630 shares and 43,83,376 quantity of mutual funds resulting into short term and long term ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... wn as short term / long term capital gain and the same has been accepted in all the years by the Assessing Officer mainly under scrutiny proceedings u/s 143(3) of the Act. In support of this contention, reliance was place on the decision of the ITAT, Mumbai Bench in the case of Gopal Purohit vs. JCIT [29 SOT 117]. 5. Ld. CIT (A) after analysing the object clause of the assessee as given in the Memorandum of Association which provided that company could invest or trade in stock / shares and from the scrutiny proceedings of Profit & Loss Account, he observed that entire income disclosed is with respect to dealing in shares only. Even in the Profit & Loss Account, sale of shares and profit on sale of investments have been shown separately. Fu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... are and also for shares shown under the head 'long term capital gain'. A comparative chart was also filed from AY 2001-2002 to 2006-2007. The details of period of holding of investments were given as under: LONG TERM Exceeding 3 years Exceeding 1 year Mutual Funds 54,48,865 22,07,688 Shares 1,99,162 3,25,492 SHORT TERM Less than a month More than a month More than three months More than six months Mutual Funds 2426 2,45,743 63,382 15,68,410 Shares - 25,41,060 30,27,224 39,09,965 7. Learned Sr. DR on the other hand submitted that most of the scrips were repetitive and period of holding was very less which is evident from the details submitted by the assessee. He also pointed out that PMS expenses have ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Purohit reported in (2010) 228 CTR 582 (Bom.) gets squarely applicable, wherein the decision of ITAT, Mumbai Bench as has been relied on by the learned AR has been affirmed. In a recent decision by the Hon'ble jurisdictional High Court in the case of CIT vs. Suresh R Shaw vide order dated 5th July, 2012 has upheld the proposition of Gopal Purohit decision has been upheld, that there is no bar for an assessee to maintain two separate portfolios i.e. one in relation to investment in shares and other relating to business activities involved in dealing of shares. It is also noticed that, in the case of assessee, under the head 'short term capital gains' most of the shares have been held for a period of more than three months and six months and ..... X X X X Extracts X X X X X X X X Extracts X X X X
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