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TMI Blog2018 (10) TMI 1349X X X X Extracts X X X X X X X X Extracts X X X X ..... listed shares and securities held for a period of more than 12 months as income from capital gains if the assessee so desires. The dismissal of the Special Leave Petition of the department by in the case of Pr. Commissioner of Income Tax vs. Bhanuprasad D. Trivedy (HUF) (2018 (7) TMI 1236 - SUPREME COURT OF INDIA) also comes to the aid of the assessee wherein the Hon ble Apex Court upheld the Hon ble High Court s impugned order that intention of the assessee at the time of purchase of shares is paramount. - Decided against revenue. - ITA No. 6064/Del/2014 - - - Dated:- 23-10-2018 - SHRI N.K.SAINI, HON BLE VICE PRESIDENT AND SHRI SUDHANSHU SRIVASTAVA, JUDICIAL MEMBER For The Revenue : Shri K. Tiwari, Sr. DR For The Assessee : ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aimed by the assessee. Accordingly, the AO proceeded to assess the gains derived from the share trading as business income as against capital gains as claimed by the assessee. The assessment was completed at an income of ₹ 2,15,49,360/- wherein the long term capital gain of ₹ 1,75,54,960/- claimed as exempt u/s 10(38) and short term capital gains of ₹ 19,22,796/- were assessed as business income. The consequential effect was that the set off of short term capital loss of ₹ 19,53,229/- was also not allowed. 2.1 Aggrieved, the assessee approached the Ld. CIT (A) challenging the treatment of capital gains as business income. The Ld. CIT (A) directed the AO to assess the gains of ₹ 2,14,75,356/- from sale of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as submitted that the assessee firm consisted of six partners who had come together to put their funds in a collective manner for better utilisation and, therefore, the activity was purely of business and not of investment. He referred to the objects, as mentioned in the partnership deed, and submitted that even the objects of the partnership firm mentioned that the object of the firm was to carry on business of funding and investments and, therefore, it was very much clear that the partnership had been constituted to carry on business. The Ld. Sr. Departmental Representative also submitted that the transactions were huge and, therefore, it was evident that the nature of activity was in the nature of business and not investment. The Ld. Sr. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -03 onwards. It was also submitted that during the year under consideration or in earlier years, the portfolios of the shares have not been inter-changed. It was further submitted that once the segregation of shares under two different portfolios has been made and accepted, the mere quantum of turnover and frequency of the transactions will not decide the nature of transactions. Reliance was placed on the judgment of the Hon ble Apex Court in the case of Pr. Commissioner of Income Tax vs. Bhanuprasad D. Trivedi (HUF) reported in (2018) 95 taxmann.com (SC) wherein the Hon ble Apex Court had dismissed the department s Special Leave Petition against the order of the Hon ble High Court wherein the Hon ble High Court, by the impugned order, had ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ansactions of sale of shares which have been duly disclosed under Short Term Capital Gains taxable at the normal tax rate of 30%. It is also not established by the department that the assessee has made repetitive transactions of purchase and sales of shares. It is also undisputed that the assessee has earned substantial dividend income by holding investments and the dividend income during the year amounted to ₹ 26,36,252/-. It is also to be noted that the assessee s two portfolios have been accepted by the department since assessment year 2002-03. The Ld. CIT (A) has given due credence to all these facts and the Ld. Sr. Departmental Representative has not been able to point out any factual error in the findings so recorded by the Ld. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at capital gains on listed shares and securities held for a period of more than 12 months as income from capital gains if the assessee so desires. The dismissal of the Special Leave Petition of the department by the Hon ble Apex Court in the case of Pr. Commissioner of Income Tax vs. Bhanuprasad D. Trivedy (HUF) (SC) also comes to the aid of the assessee wherein the Hon ble Apex Court upheld the Hon ble High Court s impugned order that intention of the assessee at the time of purchase of shares is paramount. Accordingly, in view of our above observations, we find no reason to interfere with the findings of the Ld. CIT (A) from this issue and we dismiss the grounds raised by the department. 6. In the final result, the appeal of the depart ..... X X X X Extracts X X X X X X X X Extracts X X X X
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