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2016 (7) TMI 17 - AT - Income TaxRevision u/s 263 - whether gain from sale of shares is to be assessed as a business income or short term capital gain/long term capital gain? - Held that:- CIT(A) did not dispute with regard to the contention of the assessee that in the books the assessee has shown share transaction as an investor. Her status as investor was accepted by the department in preceding year as well as in subsequent year. The assessee has not used any borrowed funds. It has not incurred any expenditure for portfolio management or keeping a track on the investment. The shares were not valued either at market value or at cost, whichever is lower on the close of the year. We have also perused the details of long term capital gains and short term capital gains reproduced by the ld.CIT. Only reason assigned by the CIT is that some of the shares were sold immediately after their acquisition. But the CIT nowhere pointed out that whether the deliveries of the shares were taken by the assessee or not. In our opinion, the ld.CIT failed to make a case that the assessee was trading in shares and not made investment. The reason assigned by the CIT is based only one circumstance, which was also not being conclusively demonstrated. No doubt, three scrip were sold by the assessee in very short span of time, but the total investment made by the assessee, with regard to the short term capital gain is in nine scrip. Similarly, under long term capital gain, it has purchased shares of three companies only. Therefore we are of the view that the ld.CIT could not bring sufficient material on record demonstrating the fact that the assessee was acting as trader and not an investor. Therefore, we allow the appeal of the assessee, and set aside the order passed under section 263 of the Income Tax Act, 1961 - Decided in favour of assessee.
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