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TMI Blog2013 (10) TMI 1182X X X X Extracts X X X X X X X X Extracts X X X X ..... Tax Appeal No. 406/2013 & CM No. 12622/2013 - - - Dated:- 22-10-2013 - Sanjiv Khanna And Sanjeev Sachdeva,JJ. For the Appellant : Mr. Sanjeev Sabharwal, Sr. Standing Counsel Mr. Puneet Gupta, Advocate For the Respondent : Nemo ORDER Sanjiv Khanna, J. (Oral): This appeal by the Revenue, which pertains to Assessment Year 2006-07, is delayed by 156 days. The appellant had earlier filed an appeal before the Allahabad High Court, which was withdrawn for lack of jurisdiction and now this appeal has been preferred before the Delhi High Court. Before issuing notice on the application for condonation of delay, we deem it appropriate to examine and consider the appeal on merits. 2. The assessee is a company. In the return for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... der the head investment on 1st April, 2004. This factual position was not disputed or questioned. The shares in question were sold during the period ending 31st March, 2006, nearly 2 years after the date of conversion of stock in trade into investment with a specific declaration. Mere fact that Section 10(38) was introduced in the statute by Finance Act 2004 with effect from 1st April, 2005, does not mean that the said conversion was improper or illegal. After the said Section was inserted, the assessee on noticing the tax benefit, was entitled to convert and change his holding from stock in trade into investment. Such conversion cannot be dealt with and rejected on the ground that Section 10(38) of the Act was introduced with effect from ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... me. The Commissioner (Appeals) noticed that for the Assessment Year 2005-06 assessment was concluded under Section 143(3) vide order dated 27th November, 2007 but the Assessing Officer did not object to the said conversion. These shares were subsequently sold as detailed in paragraph 2.9 of the order of the Commissioner (Appeals) in August, 2005, September, 2005 and substantial portion was sold in March, 2006 and long-term capital gains was declared. He observed that statute did not reject or frown upon conversion of stock in trade into investment and the said conversion was permissible. Commissioner (Appeals) referred to the Circular No. 4/2007 dated 15th June, 2007 issued by the Central Board of Direct Taxes, which stipulates that two por ..... X X X X Extracts X X X X X X X X Extracts X X X X
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