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TMI Blog2019 (9) TMI 1090X X X X Extracts X X X X X X X X Extracts X X X X ..... ase of the assessee was selected for scrutiny and the Assessing Officer completed the assessment u/S. 143(3) the Income Tax Act, 1961 vide assessment order dated 21/12/2010. It has been stated in the appeal that the Assessing Officer, while completing the assessment, accepted and assessed the long term capital gain derived as a result of sale of shares, but treated the short term capital gain derived from purchase and sale of shares, as income from business only on the ground that there were large number of transactions and ignoring the fact that the appellant is a regular investor in shares for past many years. The assessing officer levied tax at higher rate of 30% on such income and against 10% leviable on short term gain which resulted in additional demand of Rs. 37,33,743/-. Being aggrieved by the assessing order dated 21/12/2010, the appellant preferred an appeal before the Commissioner of Income Tax (Appeals) on various grounds and the Commissioner of Income Tax (Appeals), as earlier similar orders were passed on 30/5/2011 in the case of the assessee for the assessment year 2004-05, has allowed the appeal by an by order dated 5/3/2012. The Department being aggrieved by ord ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ar business of trading of shares. He has not kept designated employees / portfolio managers to take care of investment and as there were huge number of transactions of regular purchase / sale of equity shares of various listed Companies which were carried out by the assessee and the assessee has earned income from futures and option transaction of equity shares, the same has to be assessed as business of share trading. He has also argued that the frequency of transactions carried out during the year shows that approximately 288 transactions took place for the purchase of equity shares through out the year and about 162 transactions of sale have been entered with various share brokers including Arihant Capital; JM Finance P. Ltd., etc., and in those circumstances the assessee has entered into multiple transactions for various listed Companies and in those circumstances it was a regular feature of the assessee to trade in shares to obtain short term gain and, therefore, short term gain has rightly been included as business adventure and had rightly been included in the income of the assessee. It has been argued that the Assessing Officer and the Tribunal were justified in treating th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sessing officer levied tax @ 30% on such income against 10% leviable on short term gain and the same has resulted in additional demand of Rs. 37,33,743/-. Against the order dated 21/12/2010 an appeal was preferred and the same was allowed against which the Department has preferred an appeal and the appeal preferred by the Department has been allowed by the Income Tax Appellate Tribunal. The order passed by the Income Tax Appellate Tribunal, in paragraphs 10, 12, 16, 17, 18 and 19 reads as under: 12. It is an established fact that the issue relating to taxability of gain/loss from purchase/sale of equity shares is purely a matter of fact and the treatment of such gain/loss can be decided only on the basis of the facts of the particular assessee. Though the Ld. Counsel for the assessee has relied on many judgments but in our humble view the decision cannot be applied squrely on the facts of the Rajeev Choudhary ITA Nos.293/Ind/2012& C.O.No.65/Ind/2012 assessee. Though the facts before the Hon'ble High Court of Bombay in the case of ITO vs. Gopal Purohit are similar to a considerable extent but the view cannot be applied on the facts of the assessee because it does not fulfil ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for the purchase of equity shares which have been carried out throughout year. Similarly, around 162 transactions for sales have been entered with various share brokers including Arihant Capital Market Ltd., J.M. Finance P. Ltd. etc. Undisputedly the assessee had entered into multiple transactions for various listed companies however in the case of BOC India Ltd. around 70 transactions of sales took place during the year and the assessee purchased 1,07,640 equity share valuing at Rajeev Choudhary ITA Nos.293/Ind/2012& C.O.No.65/Ind/2012 Rs. 1,58,73,054/- and sold the equity shares of the same quantity. In the case of Escorts Ltd. 253934 equity shares were purchased and sold during the year on 52 occasions. In case of Fortis Health Care Ltd. 1,88,690 equity shares were purchased and sold scattered over on 31 transactions. 16. Frequency of transactions also plays vital role in examining taxability of such transactions. Though it is pleaded that the assessee is a very busy Doctor engaged in the professional work but what transpires from the records is that the assessee is devoting his time and knowledge for regular purchase and sale of equity shares round the year. Even otherwise th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... also justified in treating the income as business income in respect of purchase / sale of shares (short term gain). The aforesaid findings of the Assessing Officer which have been affirmed by the Income Tax Appellate Tribunal are purely the findings of facts. Learned counsel for the appellant placed reliance upon the judgment delivered in the case of Hiren M. Shah (supra) and the facts of the case are distinguishable especially keeping in view the frequency of the transactions in respect of the short term gain as it was certainly a business adventure on the part of the assessee. In the case of Gopal Purohit (supra), the frequency of purchase of share has not at all been considered. Similarly, in the case of Om Prakash Suri (supra) and in the case of Anoop Karwa (supra), decided by this Court, similar issue was not at all involved. The findings of fact in respect of the numerous transactions have not been touched in any of the judgment relied upon by the learned senior counsel for the appellant and, therefore, the judgment relied upon by the learned counsel for the petitioner are of no help to the petitioner. On the other hand, learned counsel for the respondent - Department has ..... X X X X Extracts X X X X X X X X Extracts X X X X
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