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TMI Blog2015 (9) TMI 284X X X X Extracts X X X X X X X X Extracts X X X X ..... scrips carried over from preceding assessment year only. This leaves behind other four scrips. Two of them have holding period less than a month i.e. 18 days and two days; respectively involving profits of ₹ 7,873/- and ₹ 2,600/-. We take into account non usage of borrowed funds, separate portfolio being maintained along with judicial consistency as in preceding assessment year and hold that these transactions do not involve any trading element therein. We accept assessee’s grounds and reverse the CIT(A)’s corresponding findings. Decided in favour of assessee. - ITA No. 1028/Ahd/2010, ITA No. 427/Ahd/2010 - - - Dated:- 26-8-2015 - Shri G.D. Agrawal and Shri S.S. Godara, JJ. For The Revenue : Shri Dinesh Singh, Sr. D.R. For The Assessee : Shri S.N. Soparkar, A.R. ORDER PER : S. S. GODARA, JUDICIAL MEMBER:- These cross appeals by assessee and the Revenue for A.Y. 2005-06, arise from order of the CIT(A)-VIII, Ahmedabad dated 20- 11-2009 in appeal no. CIT(A)-VIII/DC-4/259/259/07-08, in proceedings under section 143(3) of the Income Tax Act, 1961; in short the Act . 2. The assessee s sole substantive ground challenges the CIT(A) s order affir ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... me of finalisation of account. Learned A. O. has not clarified as to how and in what manner he has been able to understand and conclude the intention. The facts of the matter is, in the course of assessment proceedings, various details, including copies from the statutory records like Accounts maintained by us has been provided. From the copies of said Accounts, it is absolutely clear that at the time of purchase, shares acquired as Investments has been taken on the same day to investment Account and shares acquired for the purpose of trading business has been taken to Purchase Account. Copies of the said account are attached for your ready reference. The finding given is without any basis or clinching evidence and therefore it is nothing but presumption only. Moreover, the factual summarized position of the transactions under reference is as under: Sr. No. Name of the Script No. of transa ctions Quantity Sales Price Purchase Price Gain (Loss) 1 Nirma Ltd. 2 1300 4,69,058 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5 scripts, which has been held as investment for a period of less than twelve months and hence income has been correctly computed under the head short term capital gain. From the above facts, your honour would appreciate the basis on which conclusion has been drawn, itself from fact and reality. Thus considering the number of transactions, volume of business, assessee's capital reserves and f/r%ainly intention of the assessee and accounting treatment given in the books of accounts, income has 3n correctly computed under the head capital gain and as none of the provision relating to business 'income are applicable on facts of the case, income assessed as business income need to be deleted and it may kindly be directed to assess the same as per the total income computed. (b) The assessee by writing the transactions in particular fashion can not change the nature of transaction. The nature of transaction has been explicitly explained in the course of assessment. The writing of transactions, audited by independent Chartered Accountants following the Accounting Standards and Statutory requirement, clearly reflects the intention of the Company and which explai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1700 30 mths 10,200 73,100 (62,900) Total Gain / (Loss) 8,52,221 Short term Capital Gain Sr. No. Name of the scrip No. of transactio ns Quantity Period of holding (Approx) Sales Price Purchase Price Gain (loss) 1 Guj. Heavy Chemical s Ltd. 7 416847 7 to 10 mths 1,26,54,9 35 1,04,45,6 08 22,09,327 2 Reliance Cap. Ltd. 1 500 18 days 89,943 82,070 7,873 3 GTL 2 2400 2 days 2,70,220 2,67,620 2,600 4 Vishal Exports ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is ground of appeal is therefore allowed partially. 5. We have heard both the parties and gone through the case file. Both sides argue strongly for their respective grounds. The sole issue that arises for our consideration is as to whether the assessee s claim of impugned share profits of ₹ 8,52,221/- and ₹ 23,95,326/- treated as long term and short term capital gains respectivly is to be accepted in toto, in part; or to be rejected; as done by the CIT(A) and Assessing Officer; respectively. The CIT(A) s findings extracted hereinabove demonstrate frequency and magnitude of share transactions, assessee s accounting treatment, holding period, absence of any borrowed funds being utilized in shares etc. to name a few decisive factors. It has come on record that assessee s identical profits in preceding assessment year stand treated as capital gain only. It entered into 10 transactions in relevant previous year. The former head of long term capital gains comprise of shares held from minimum 15 months to holding period as long as 32 months. The same can in no way be taken an instance of a trading activity. More particularly, when such a long term investment covers almost ..... X X X X Extracts X X X X X X X X Extracts X X X X
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