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2018 (12) TMI 1332 - HC - Income TaxProfit arising on the frequent and voluminous transactions initiated with borrowed funds in shares - 'Long Term Capital Gain' OR 'Business Income' - Held that:- Circular No. 6 of 2016 dated 29.2.2016 issued by the Central Board of Direct Taxes (CBDT) issued with regard to the issue of taxability of surplus on sale of shares and securities, - whether as capital gain or business income in case of long term holdings of shares and securities i.e in excess of 12 months. It has clarified therein that with a view to reduce litigation and uncertainty in the matter of taxibility, as long term capital gains or business income - the assessee has an option to treat the income from sale of listed shares and securities as income arising under the head 'Long Term Capital Gains', them the same shall be accepted by the assessing officer. However, the stand once taken by the assessee would not be subject to change and consistently the income on the sale of securities which are held as investment would continue to be taxed as long capital gains or business income as opted by the Assessee. The circular makes no distinction whether the investments made in shares were out of borrowed funds or out of its own funds. Thus, the distinction which has been sought to be made by the Revenue cannot override the above CBDT Circular, which is binding upon it - issue stands concluded in favour of the Respondent by the above CBDT Circular, the above question as proposed does not give rise to any substantial question of law. Hence, not entertained. Treatment to the notional loss incurred on Futures & Option transaction as normal business loss - Held that:- This issue stands concluded against the Revenue by the decision of this Court in the case of Commissioner of Income Tax Vs. Bharat R. Ruia (HUF) reported in [2011 (4) TMI 37 - BOMBAY HIGH COURT].
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