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TMI Blog2011 (2) TMI 1486X X X X Extracts X X X X X X X X Extracts X X X X ..... ee is an individual and during the year has shown share trading income, speculative loss, capital gains and income from other sources. During the assessment proceedings, the AO noticed that the capital account of the assessee shows that the receipts of the assessee are arising out of transactions in shares and securities. However, in the computation of income, the assessee has bifurcated these receipts and offered the profit and gains on sale of shares as capital gain as well as business income separately. The AO noted that the short term capital gain shown by the assessee was to the tune of ₹ 26,36,439/- as business income. The AO was of the view that looking into the volume, frequency and continuity in the purchase and sale of share ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erm capital gain and long term capital gain and submitted that the assessee has earned about ₹ 1,60,00,000/- as long term capital gain during the period and also earned dividend income of more than ₹ 33 lakhs. Thus, the intention of the assessee is clear from the investment in shares which are kept for long term and earning the dividend income there from. The short term capital gain of the assessee is ₹ 26,36,000/- and part of it was taxable under normal tax rates. The assessee was having only one loan of ₹ 1,58,000/- from Anush M Shah of the HUF which was taken temporarily for the purposes of investing in IPO and was repaid in the same year without any interest. The assessee has not claimed any expenditure against t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... AY-2005- 06 dt. 23.7.2010 Karishma V Shah V ACIT 4 ITAT Order in ITA No.2731/Mum/2009 for AY-2005- 06 dt.26.2.2010 Vinod V Shah V Shah V ACIT 5 ITAT Order in ITA No.181/Mum/2010 dt.3.12.2010 ACIT V/s Vinod K Nevatia 6 ITAT Order in ITA No.2733/Mum/2009 dt.15.12.2010 Nehal V Shah V/s ACIT 7 ITAT Order in ITA No.799/Mum/2009 dt.24.11.2010 DCIT V. M/s SMK Shares and stock broking pvt ltd 8 Delhi High Court order dated 18.10.2010 in the case of ITA No.306/2010 CIT V/s PNB Finance and industries ltd 6. On the other hand, the learned DR has submitted that some of the analysis filed by the assessee in the paper book were not before the AO. He has further submitted that the assessee is purchasing the shares at large volume and transac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... transactions in shares and securities under separate heads and portfolio under trading and investments and accordingly offered the income from sale of securities under different heads. The assessee offered the business income, short term capital gain, long term capital gain, dividend income and interest. The details of income are as under : Heads of income Income % of income Business income 454,200 1.96% Short term capital gains 26,36,004 11.39% Long term capital gains 1,60,23,772 69.26% Dividend 33,11,974 14.31% Interest 7,11,358 3.07 9. The assessee is having its own capital of ₹ 7.45 crores as on 1.4.2004 and ₹ 9.29 crores as on 31.3.2005 as against the investment in shares at ₹ 4.49 crores as on 31 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ude. It does purchase and sales of shares in hundreds crores and it deals in lacs of scripts. Volume of shares is in hundreds of cores of transaction. Numbers of shares transacted are in crores. It does it on day to day basis. It took loan from private parties and institution. It does the business through brokers. Members o f APO are keeping complete watch on market and dealing accordingly. All this shows that the appellant AOP is engaged in adventure in the nature of trade. It is worthwhile to maintain that " 10 From the above facts it is clear that these facts do not pertain to the assessee and therefore the order of the CIT(A) is based on assumption of facts which do not emerge from the record of the assessee's case. The assessee has al ..... X X X X Extracts X X X X X X X X Extracts X X X X
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