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TMI Blog2014 (9) TMI 393X X X X Extracts X X X X X X X X Extracts X X X X ..... cision of the Income Tax Appellate Tribunal dated 7 January 2014. The assessment year to which the appeal relates is A.Y. 2005-06. The following questions of law have been framed in support of the appeal : "A. Whether the ITAT erred in law in ignoring circular no.4 of 2007 dated 15.6.2007 where distinction has been drawn between shares held as stock-in-trade and shares held as investment. B. Whe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uently treated an amount of Rs. 29.03 lacs as business income. The CIT(A) allowed the appeal of the assessee and made the following factual determinations: "(i) The assessee is full time employee with a company for financial year 2006-07 onwards. There is nothing on record to show that she has expertise in share market; (ii) The sequence of evidence supports her view that as her daughter gifted ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e shares have been sold before completion of a year; cannot be taken as a basis to penalize the assessee with the view that it was a business transaction; when the assessee is duly showing it as short term capital gain; (vii) Long term capital gain/loss has been accepted on similar purchase and sale; (viii) The assessee had never used any borrowed funds; (ix) The assessee has not claimed any ex ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ncome as arising from them as a business transaction when the assessee had duly shown it as short term capital gains. The CIT(A) had duly considered all the facts and circumstances of the case and had come to the conclusion that the intention of the assessee was to make an investment and not to carry on any trade or business in shares or securities. This finding has been affirmed by the Tribunal. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tock-in-trade and those which are held by way of investment." In the case of Commissioner of Income-tax, Bombay v. H. Holck Larsen [1986] 160 ITR 67, the Supreme Court observed: "The High Court, in our opinion, made a mistake in observing whether transactions of sale and purchase of shares were trading transactions or whether these were in the nature of investment was a question of law. This was ..... X X X X Extracts X X X X X X X X Extracts X X X X
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