TMI Blog2014 (2) TMI 505X X X X Extracts X X X X X X X X Extracts X X X X ..... and the profit from transfer of shares was accepted as capital gain on the strength of similar view taken and accepted in the earlier orders – the CIT(A) has taken an unimpeachable view on the issue and the order is upheld – Decided against Revenue. Nature of F/O losses – Business loss OR Speculative loss – Held that:- The decision in CIT v/s Bharat R. Ruia (HUF) [2011 (4) TMI 37 - BOMBAY HIGH COURT] followed - the loss on account transactions in derivatives is speculative up to A.Y. 2005-06 and further that the insertion of clause (d) to the proviso to the section 43(5) is prospective and hence applicable from assessment year 2006-07 - As the assessment year under consideration is prior to the insertion of clause (d) – the order of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... from sale of shares as short term capital gain as against the `Business income' held by the AO. 3. Briefly stated the facts of these grounds are that the assessee purchased and sold certain shares, profit from which was claimed as Short term/Long term capital gain depending upon the period of holding. The Assessing Officer did not dispute the long term capital gain. However, due to reasons discussed in the assessment order, he treated the assessee as a trader instead of investor and accordingly recharacterized the amount shown as `Short term capital gain' as `Business income'. The ld. CIT(A) noticed that the assessee consistently held the shares as `Investment' and this treatment of profit from sale of shares as `capital gain' stood accep ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ort term capital gain which was assessed by the Assessing Officer as such in assessment made u/s 143(3) of the Act. A copy of the such assessment order has also been placed on page nos. 81 to 84 of the paper book. This shows that the assessee held and declared the shares as `Investment' and this stand came to be accepted by the Revenue. We fail to understand as to how a different treatment can be given in the previous year relevant to the assessment year under consideration. The Hon'ble jurisdictional High Court in the case of CIT vs. Gopal Purohit (2010) 336 ITR 287 (Bom) approved the view taken by the Tribunal in which the principle of consistency was followed and the profit from transfer of shares was accepted as capital gain on the stre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce applicable from assessment year 2006-07. A Special Bench of the Tribunal in Shree Capital Services Ltd. vs. ACIT (2009) 124 TTJ 740 (Kol)(SB) has also decided this issue against the assessee. As the assessment year under consideration is prior to the insertion of clause (d), we overturn the impugned order and restore the assessment order on this issue. The ld. AR was fair enough to accept this position. These two grounds of the Revenue's appeal are allowed. 7. In the result, the appeal is partly allowed. A.Y.-2006-07 8. This appeal by the assessee has been filed against the order passed by the ld. CIT(A) in assessing income of Rs.1.24 crores as `Business income' instead of `Short term capital gain.' 9. Filtering out unnecessary d ..... X X X X Extracts X X X X X X X X Extracts X X X X
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