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TMI Blog2019 (1) TMI 1362X X X X Extracts X X X X X X X X Extracts X X X X ..... d arm of the settler company. It is not holding the shares in its own absolute rights, as has been contended by the Revenue also. Under these circumstances, it will be very difficult to categorise these shares as business assets, meant for trading by the assessee trust. In the case of a trader, the motive is to maximize the profits, as the main object of the proper is mechanized the profits by doing the business of trading. The attributes available in the transaction of the assessee trust are unlike that of a trader and are more like that of an investor. The assessee trust is not free or authorized to sell the shares, held by it on behalf of the settler company, to any person in the free market at fair market price. Under such circ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed by the employer. As per the Trust deed, it was established for the welfare of the employees of the settler company. The activities of the Trust included investing in equity shares, to hold equity shares of the company and to administer the fund as instructed by the Compensation Committee for the benefit of the eligible employees. The Committee would recommend granting of options to the eligible employees. Such options would include a right to choose Employees Stock Option Scheme. The Assessing Officer noted that during the year under consideration several employees had exercised such option and the Trust had allotted shares to such employees in terms of their options. The proceeds received from the employees were recognized by the Trust ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e also. Under these circumstances, it will be very difficult to categorise these shares as business assets, meant for trading by the assessee trust. In the case of a trader, the motive is to maximize the profits, as the main object of the proper is mechanized the profits by doing the business of trading. The attributes available in the transaction of the assessee trust are unlike that of a trader and are more like that of an investor. The assessee trust is not free or authorized to sell the shares, held by it on behalf of the settler company, to any person in the free market at fair market price. Under such circumstances, the assessee trust is not in a position to earn maximum profits. Thus, it could be safely said that certainly ..... X X X X Extracts X X X X X X X X Extracts X X X X
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