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2014 (9) TMI 173 - ALLAHABAD HIGH COURTIncome from dividend, commission and interest from the business of trading in shares – Business income or income from other sources – Shares held as stock in trade - Held that:- Assessee held shares as stock-in-trade - The dividend income earned by him on the shares does not cease to be income which arises in the course of business, though for the purpose of chargeability to tax, such income would be included under the head "Income from other sources" - where a shareholder receives dividends in respect of the shares held by him, the dividend is received because of the fact of his holding the shares - There may be no doubt of earning substantial dividends on the shares but one has to consider from the point of view that the assessee 's business income consist of purchase and sale of shares - assessee does not purchase the shares with a view to get dividend, but the object of purchasing his shares is to earn profit by the sale of those shares - earning of dividends is merely the incidental result to the main activity of the purchase and sale of shares - receipt of dividends will not be chargeable to income tax under the head "profits & gains from business or profession" - relying upon Commissioner of Income-Tax, Bombay City-II Vs. D.G.Goenka [1980 (4) TMI 41 - BOMBAY High Court] the dividend income arrived at by the appellant was chargeable under the head "Income from other sources" – the order of the Tribunal is upheld – Decided against Assessee.
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