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2012 (10) TMI 485 - ITAT, DELHIIncome from sale purchase of shares - income from short term capital gain v/s business income - Held that:- Habitual dealing in a particular item is indicative of the assessee’s intention of trading. Merely for taking benefit of provisions of sec. 111A applicable from the AY 2005-06, the assessee can not be categorised as an investor, especially when the aforesaid facts speak otherwise and lead to the conclusion that the assessee is indulging in activities of a trader in shares - the character of a transaction cannot be determined solely on the application of any abstract test or rule and the cumulative factors affecting the transactions have to be seen The voluminous share transactions were in the nature of the business, purchase of shares by them was not for the purpose of earning dividend, but with the dominant intention of resale in order to earn profits, the profit made by the assessee is not of mere enhancement of value of the shares, but is a profit made in the carrying on of a business scheme of profit making & huge volume of share transactions, the repetition and continuity of the transactions, give them a flavour of “trade”, the magnitude, frequency and the ratio of sales to purchases on the total holdings is evidence that the assessee had not purchased the shares as an investment, but with the intention to trade in such scrips. Thus the CIT(A) was not justified in accepting the claim of the assessee as investor in shares. Accordingly the findings of the CIT(A) are vacated and restore the order of the AO - against assessee.
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