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2014 (9) TMI 359 - AT - Income TaxNature of transaction - STCG on transaction in shares – Assessee trader in shares or an investor – STCG treated as business income – Held that:- Following the decision in Spectra Shares and Scrips Pvt. Ltd. vs. CIT [2013 (6) TMI 173 - ANDHRA PRADESH HIGH COURT] - the closing stock was valued in its books of account consistently at cost and not at cost or market price whichever is lower - all the transactions of purchase and sale were delivery basis except the some instance of Reliance Industries Ltd. - Merely because of large frequency and volume of transactions, a conclusion that an assessee is a trader cannot be drawn - The fact that the assessee is monitoring the stock markets and buying at dips and selling at highs with an intention to make profit from these transactions is not conclusive of the fact that the assessee is a trader because even an investor would not buy or sell blindly and take the risk of suffering losses - assessee changes the shares contained in the investment portfolio so that the capital is preserved - The fact that the assessee is making repetitive purchases and sales of the same shares is a factor in favour of holding that the assessee is an investor - Revenue had accepted that the assessee was an investor whose income is chargeable under the head "capital gains" for a number of years – thus, the assessee is an investor and not a trader –Decided in favour of assessee.
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