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TMI Blog2013 (1) TMI 821X X X X Extracts X X X X X X X X Extracts X X X X ..... g the Assessing Officer not to treat otherwise the income declared under the head Short Term Capital Gains ignoring the fact that during the year under consideration the assessee was engaged in the business of trading and investment of shares and securities. 3. Brief facts giving rise to this appeal are that the case of assessee was selected for scrutiny and a notice u/s 143(2) of the Income Tax Act, 1961 (for short the Act) was served on the assessee. During the assessment proceedings, the Assessing Officer observed that the assessee had an income from sale of investment and he treated the same as business income instead of income under the head capital gains . With this observation, the amount of ₹ 37,81,329 was treated as sh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and the total number of transactions were quite few. All the shares purchased were not sold and held for quite a number of days. It was held that transactions were to be treated as giving rise to capital gains and could not be branded as trading in shares. The case in hand stands on an equal footing and, therefore, has to be treated as income out of capital gains and not trading. 4. Ld. DR submitted that the Commissioner of Income Tax(A) has erred in law and facts in directing the Assessing Officer to not to treat otherwise the income declared under the head short term capital gains . Ld. DR further submitted that the Commissioner of Income Tax(A) ignored the fact that during the year under consideration, the assessee was engaged in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... we observe that the ld. Commissioner of Income Tax(A) has considered the duration of holding of shares by the assessee considering the time taken for purchase and sale of the shares. From the audited balance sheet of the assessee available from page no. 71 to 80, it is revealed that the assessee has made investment of ₹ 37,57,962 at the end of relevant financial year. As per period of holding, considered by ld. Commissioner of Income Tax(A) in para 7 of his order, we observe that the assessee had held shares minimum from 5 months to 9 months. This period of holding suggests that the intention of the assessee was not to do the business of shares but for short term investment purpose and income from sale of these short term investments ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... this count was originally made by the Assessing Officer amounting to ₹ 50,000 on estimated basis with an observation that the assessee has shown dividend income of ₹ 67,737 as exempted income and expenses related to this income needs to be disallowed as per section 14A of the Act. The DR submitted that although the addition u/s 14A of the Act amounting to ₹ 50,000 was made by the Assessing Officer but in the appellate proceedings it was reduced to ₹ 23,087/- by Commissioner of Income Tax(A) considering the arguments of the assessee. 12. After careful consideration of rival submission on this issue placed before us by both the parties, we observe that the Commissioner of Income Tax(A) has considered various decisio ..... X X X X Extracts X X X X X X X X Extracts X X X X
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