9911796707
TMI Blog2009 (11) TMI 956X X X X Extracts X X X X X X X X Extracts X X X X ..... hare transactions is a short term capital gain or business gain as assessed by the AO. 3. The assessee filed its return of income on 1.7.2006 declaring total income of ₹ 24,31,963/- and has shown in the statement of capital gain as short term capital gain of ₹ 25,92,222/- and short term capital loss of ₹ 1,65,535/- Accordingly, the net short term capital gain shown by the assessee as ₹ 24,26,687/-. The AO noted that the assessee included the speculation profit of ₹ 32,297/- and speculation loss of ₹ 9,560/- on certain scripts in the short term capital gain /losses. This speculation profit and loss is pertaining to the transactions which are in the speculating nature either intera day or within a day. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es sold were held for less than 30 days. The CIT(A) was of the view that the income cannot be assessed under a different head of income merely because the taxability of the same under a different head result in increase in revenue by following the decision of this Tribunal in the case of Gopal Purohit 20 DTR 99 (22 TTJ Mum 87). 5. Before us, the learned DR has submitted that the assessee has carried out the speculation transactions in as many as 31 transactions as details are given at page 2 of the assessment order. In the case of income tax, principle of resjudicata is not applicable and the transaction has to be considered independently by treating each assessment year as a separate unit. The intention of the party has to be seen for det ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The nature of activity in the earlier years and in the year under consideration is the same. There has been no change in modus operandi nor in the manner of carrying on investment activity. He has further contended that mere change in law in relation to change in the rate of tax in respect of short term capital gains from normal rate of tax to special rate of tax would not alter the head of income under which the gains ought to be assessed. The income cannot be assessed under a different head of income merely because the taxability of the same under a different head result in increase in revenue 7 The learned AR also submitted that the assessee was holding the shares as investment and it is the intention of the assessee which was to be se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... AO. It is pertinent to note that none of the script has been retained by the assessee up to one year and all the securities which were purchased by the assessee during the year were sold within the year. The number of transactions were sold within the period of 10 days and the holding period of around 100 of the transactions is less than 30 days. Taking loan or utilized is own fund is not the sole criteria for determining the nature of transactions as investment or trading activities. This is not a case where the assessee is maintaining more one portfolio in the books of account where some shares are kept for investment and others for trading by dealing under separate account. The assessee is not maintaining the books of account but doing t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ding period for good number of transactions, is only for few days that is less than 10 days. Thus, from the facts it is clear that the assessee had no intention to hold the shares for longer period for appreciation of the investment and earning the income of dividend income but the motive of the assessee is quite apparent from the frequency and the volume of the transactions carried out by the assessee. Accordingly, the case relied upon by the assessee are not relevant and applicable in the facts and circumstances of the case. Hence we set aside the order of the CIT(A) and restore that of the AO.
10. In the result, the appeal of the revenue is allowed. .
Order pronounced in the open court on 18th Feb, 2011 X X X X Extracts X X X X X X X X Extracts X X X X
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