9911796707
TMI Blog2018 (3) TMI 137X X X X Extracts X X X X X X X X Extracts X X X X ..... it occasionally deals in equity shares then such gain is normally shown ca capital gain but in the case of the assessee it has no other source of income and is engaged in trading of shares and securities consistently since long and major source of income is from trading in shares only and if such assessee subsequently opts to show transactions of purchase and sale of shares as capital gains and simultaneously also shows trading in shares then both the things cannot go together unless otherwise demarketed with proper records. No reason to interfere with the findings of the Commissioner of Income Tax (Appeals) treating as business income relying in the case of Wallfort Financial Services (2010 (6) TMI 510 - ITAT, MUMBAI) and Puran Associates Pvt. Ltd., (2012 (4) TMI 266 - ITAT DELHI ) - Decided against assessee - ITA No. 516/Ind/2013 - - - Dated:- 28-2-2018 - Shri Kul Bharat, Hon ble Judicial Member and Shri Manish Borad, Hon ble Accountant Member Appellant by Shri C.P. Rawka Respondent by Shri K.G.Goyal ORDER Per Shri Manish Borad, AM This appeal of the assessee relating to the assessment year 2005-06 is directed against the order of the Commissioner of Inco ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eferred appeal before the Commissioner of Income Tax (Appeals) on various grounds but failed to succeed on any of them. Even the Commissioner of Income Tax (Appeals) enhanced the addition by treating total short term capital gain of ₹ 76,30,666/- as business income. Now the assessee is in appeal before the Tribunal. 4. Apropos ground no. 1 challenging the order of the Commissioner of Income Tax (Appeals) confirming the disallowance u/s 14A of the Act, we have heard rival contentions and perused the record placed before us. We find that the assessee has earned dividend income of ₹ 13,51,268/-. There is an investment in equity shares of ₹ 3,80,35,247/-. Further there have been regular transactions of purchase and sale of shares and no specific expenditure has been disallowed suo moto in the return of income. It is beyond imagination that the assessee has not incurred any expenditure. Even through the method provided in Rule 8D read with rule 14A has been brought into effect from the assessment year 2008-09 but still, in our view, minor disallowance of ₹ 2,39,108/- is justified at the end of the Assessing Officer. We find no infirmity in the findings of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nuity. It may kindly be appreciated in the instant case, there is only one ingredient of volume. He submitted that there is neither the frequency nor the continuity and regularity. Even the aspect of frequency noted by the Ld Assessing Officer does not find place in our case. The total transaction as per the chart annexed clearly suggests that the prime motive of the assessee was all along that of investment. There is no iota of trade in any of the transaction listed in the annexed chart. The learned counsel for the assessee also submitted that the learned Commissioner of Income Tax (Appeal) has referred to the assessee s computation of Income for Assessment year 2004-05. In his own wisdom the Ld Commissioner of Income Tax (Appeal) has taken note of Income from business in the Assessment year 2004-05 and made observation in which share held in stock were reflected on the basis of above observation. Ld Commissioner of Income Tax appeal has held that like Assessment year 2004-05,the assessee was carrying on Income from business from share trading and enhanced the income of ₹ 27,17,730/- from Short Term Capital Gain to Income from Business. The learned counsel for the assessee a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hares as business. In the profit and loss account there appears opening stock, purchases, sales and closing stock. In the balance sheet also the assessee has shown closing stock of equity shares of ₹ 1,96,43,532/-. In the computation of income for the assessment year 2004-05, the assessee has shown profit from purchase and sale of shares under the head business income and has also set off brought forward losses of ₹ 33,20,098/-. So there cannot be any dispute at the end of the assessee that for the assessment year 2004-05 the assessee has shown purchase and sale of shares as business income. Now coming to the year, under appeal, we observe that in the profit and loss account the assessee has not shown the closing stock of preceding financial year as opening stock. It has only shown income from share trading at ₹ 9,58,920/- and the remaining gain from purchase and sale of shares has been shifted under capital gains head. In the stock market for the assessment year under appeal, the assessee has dealt with in around 100 scripts of equity shares and the total quantity of shares as on 1.4.2004 was 369381, purchase 2911916, sales 1795817 and closing quantity 14,8 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... applies to the assessee s case as it opted to show the holding of equity shares as stock in trade during the assessment year 2004- 05 and thereafter the consistency should have been maintained. 10. Even if we go through clause (b) of para 3 relied upon by the assessee, we observe that in the last four lines it reads however, this stand, once taken by the assessee in a particular assessment year, shall remain applicable in subsequent assessment years also and the tax payer shall not be allowed to adopt a different/contrary statement in this regard in subsequent years . Even clause (b) of para 3 also does not support the contention of the assessee because the stand of showing the business has been taken up to the assessment year 2004-05 then the same cannot be changed in the subsequent years just for the sake of taking benefit of lower rate of taxation/exemption. The case would have been different if the assessee had been successful to bifurcate the transactions through a separate D-mat account which would have been otherwise used one for the purpose of investment in shares and the other for the regular trading in shares. This is not the case of the assessee as apart from non-mai ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
