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2016 (11) TMI 1601 - AT - Income TaxEarning on sale of shares of Talent Infoway Ltd - change of head of income - disputes under the head of income from other sources - Held that:- The option of the assessee in matters of the claim relating to the profits / gains on sale of shares based on the entries in the books of accounts, assumes significance. The Officers are prevented from changing the head of income for taxing the said gains arbitrarily and without having contrary evidence against the assessee. The said Circular No. 6/2016 enlists certain conditions and the Revenue Authorities are required to examine the said Circular (supra) closely and adjudicate this issue after grating a reasonable opportunity of being heard to the assessee. For this purpose, we remand this matter to the file of the AO. Prima facie, we find, the contents of para 3(a) and other paragraphs of the said Board Circular do not permit the Revenue Authorities to change the head of income from "business income" to "the capital gains" or vice versa, unless the conditions specified in para 4 of the said Circular (supra) ie bogus claims or sham transactions / questionable transactions are involved. The Revenue Authorities are required to honour the books of account and the entries therein pertaining to the shares - Appeal of the assessee is allowed for statistical purposes.
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