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TMI Blog2015 (7) TMI 444X X X X Extracts X X X X X X X X Extracts X X X X ..... gain' depending upon the period of their holding. There is no doubt that shares of Satyam Computers were not purchased or treated as Investment in any of the earlier years, but at least this factor shows that the assessee was also engaged in the purchase of shares as Investment and showing profit from their sale under the head 'Capital gains'. This treatment of profit from sale of shares held as investment has not been disputed by the AO in the assessments made u/s 143(3) of the Act. The assessee has placed on record a copy of the assessment orders for immediately preceding assessment year in which there was 'Short-term capital gain' of ₹ 17.21 crore which has been accepted by the AO vide his order dated 29.12.2011. Similarly, there i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... profit of ₹ 16,41,33,017/- from the sale of shares of Satyam Computers Ltd., which was declared as 'Short-term Capital gain'. The AO observed that the assessee purchased 70,44,801 shares of Satyam Computers during the period 9.4.2009 to 3.6.2009 and such shares were sold in entirety during the period June,2009 to January, 2010 for a consideration of ₹ 51.18 crore, realizing a profit of ₹ 16.41 crore, on which security transaction tax (STT) was paid to the tune of ₹ 6,39,749/-. On being called upon to explain as to why profit from sale of such shares be not considered as 'Business income' as against the 'Short-term capital gain' claimed by the assessee, it was submitted that the assessee was ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... % stake in Satyam Computers @ ₹ 58 per share and, hence, made an open offer to all Satyam shareholders at this rate. He, therefore, held that the object of the assessee was not to stay invested in these shares and earn dividend, but, to realize immediate profit on increase in the price of such shares. Considering this and other reasons, the AO treated the profit of ₹ 16.41 crore from sale of shares of Satyam Computers Ltd., as 'Business income.' The ld. CIT(A) got convinced with the assessee's submissions and directed to treat such shares as 'Investment' and the resultant profit as 'Short-term capital gain'. The Revenue is aggrieved against this view canvassed by the ld. first appellate authority. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ld be no possibility of making Investment, cannot be considered as decisive for holding such shares as stock-in-trade. A person may think of making investment in the shares of a company at a price which is quite low and, then, maintain position in it for a period by allowing it to prosper. There is no rule of purchasing shares as investment only when the price of shares of a company is at the peak. 6. There is Annexure to the assessment order which divulges the dates of purchase of these shares starting from 9th April till 1st June, 2009 on ten occasions and, thereafter, the sale started from 4th June, 2009 till 18th January, 2010. The assessee paid STT at the time of sale of such shares. This Annexure indicates that the assessee firstly ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sale by declaring profit as 'Short-term capital gain' or 'Long-term capital gain' depending upon the period of their holding. There is no doubt that shares of Satyam Computers were not purchased or treated as Investment in any of the earlier years, but at least this factor shows that the assessee was also engaged in the purchase of shares as Investment and showing profit from their sale under the head 'Capital gains'. This treatment of profit from sale of shares held as investment has not been disputed by the AO in the assessments made u/s 143(3) of the Act. The assessee has placed on record a copy of the assessment orders for immediately preceding assessment year in which there was 'Short-term capital gain' ..... X X X X Extracts X X X X X X X X Extracts X X X X
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