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TMI Blog2017 (3) TMI 84X X X X Extracts X X X X X X X X Extracts X X X X ..... in the stand of the assessee with that of the earlier years. Therefore, we find that the assessee has shown the impugned loss from the source of the business correctly. The ld DR has also not brought anything contrary to the finding of ld CIT(A). In view of above, we are inclined not to interfere in the order of ld CIT(A). Hence this ground of appeal of the Revenue is dismissed. - ITA No. 2487/Kol /2013 - - - Dated:- 22-2-2017 - Shri Aby.T Varkey, Judicial Member And Shri Waseem Ahmed, Accountant Member By Appellant Shri Sallong Yaden, Addl. CIT-SR-DR By Respondent Shri Manish Tiwari, AR ORDER PER Waseem Ahmed, Accountant Member This appeal by the Revenue is directed against the order of Commissioner of Income Tax ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... further observed that there was investment in quoted share as well but there was no transactions in those quoted share. The quoted share was of lesser value in comparison to investment in mutual fund. AO also observed that the intention of assessee in dealing of mutual fund was earning capital gains. Further, AO observed that in preceding assessment year 2006-07 the loss from transactions in mutual fund was treated as capital loss . Accordingly, AO called upon assessee for treating the aforesaid loss of ₹ 1,40,12,844/- from mutual fund as capital loss. The assessee in compliance thereto submitted that it is Non-Banking Finance Company duly registered with Reserve Bank of India with the main object of business as loan / advance and i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... long term profits by way of earning of exempt income in the form of dividend. In view of above, AO treated the loss of mutual fund of ₹ 1,40,12,844/- as capital loss. 4. Aggrieved, assessee preferred an appeal before Ld. CIT(A). The assessee before the learned CIT(A) submitted that it is NBFC company registered with RBI and its objects permits to carry on the business of investment, acquire, hold and dispose of or otherwise invest in shares, debentures, bonds, obligations and securities. In the earlier assessment years for 2005-06 to 2007-08 the activities of the assessee was accepted as in the nature of business. 4.1 The AO himself in the assessment order has noted that the assessee has invested substantial capital in mutua ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted by the AO as business income. Hence, it is submitted that if profit on sale of investments is accepted as business profit, the loss arising from sale of similar investments should also be considered as business loss. I find force in the argument of the appellant that the nature of business of the Company remains the same as in the past except in quantum/volume of business and the assessments for 2005-06 to 2007-08 were completed by accepting the nature of profits from investments as business income. In the light of the above discussion and findings, after perusing the entire facts of the case and following the decision of my predecessor on the issue while adjudicating the appeal of the appellant for assessment year 2006-07, I am o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... such transactions as business transactions in its books of accounts. Of late the CBDT has issued Circular No. 6/2016 dated 29.2.2016 to avoid the litigation between the assessee and the Revenue. The relevant contents are extracted below: Disputes, however, continue to exist on the application of these principles to the facts of an individual case since the taxpayers find it difficult to prove the intention in acquiring such shares/securities. In this background, while recognizing that no universal principal in absolute terms can be laid down to decide the character of income from sale of shares and securities (Le. whether the same is in the nature of capital gain or business income), CBDT realizing that major part of shares/securities ..... X X X X Extracts X X X X X X X X Extracts X X X X
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