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2015 (9) TMI 952 - AT - Income TaxPurchase and sale of shares - Short term capital gain v/s business income - Held that:- AO has accepted the capital gains from sale of shares held by the assessee for more than one year as long term capital gain which means that the AO has accepted that assessee is having some part of his portfolio as for investment and not for business which further gives support to the claim of assessee by showing income from share transactions in two heads i.e. ‘capital gains’ and ‘business income’. The intention of the assessee at the time of purchase of shares was very clear and the shares held by the assessee at the close of the Financial Year were shown under the investment account in the balance sheet under the head “shares in securities”. The AO has already accepted the claim of assessee of long term capital gains on sale of shares. The investment in shares has been shown at the cost price which otherwise if held for business would have been shown as “stock-intrade” to be valued at cost or market price whichever is lower. From the perusal of the balance sheet of the assessee it is quite clear that no specific funds were borrowed for the purchase of shares and the main source of investment in shares and securities was from the capital account of the assessee. Assessee has also maintained separate profit and loss account for F & O business and no link between investment account and F & O business has been brought on record by the AO and the investment in shares and securities have been brought forward from Financial Year wherein as on 31st March, 2005 the investment in shares and security ₹ 1,05,11,605/-and thereafter during the Financial Year 2005-06 the shares purchased and sold under the investment account have been treated as short-term and long term capital gains. However, looking to the transactions entered into by the assessee as shown under the head short term capital gains, have been properly analyzed by the CIT(A) and, therefore, in view of above, we do not find any error at the end of learned first appellate authority and, therefore, no interference is called for in the order of CIT(A). - Decided against revenue.
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