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2014 (4) TMI 681 - DELHI HIGH COURTNature of income – Sale of shares - Whether the income is business income or STCG - The shares were shown as investments by the assessee, and not as stock in trade - This is an important (though not conclusive) factor - The frequency of transactions speaks greatly to whether the shares were traded - the shares were traded irregularly is a strong pointer that they were held as investment, lest there be a new category of static trading or business - there was a limited dividend drawn from the shares - the fluctuation in the number of shares held, and also the companies in which shares are held, is minimal. Just as aggressive and constant behavior as regards the portfolio suggests business activity, its absence suggests that the shareholding was as an investment - to hold that the portfolio is to be treated as business would deny the possibility of selling an investment based on a market factors, or dealing in them it at all - the assessee has transacted in shares does not necessarily mean that it is a trading activity - shares held as investment may also be sold and purchased, the crucial factor being the frequency and volume of the trades to determine the true intention for which they are held - Considering the limited activity surrounding the shareholding of the assessee in relation to the 13 scrips, the order of the CIT(A) and the ITAT is upheld - the amount reported by the assesse is to be treated as STCG – Decided against Revenue.
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