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2022 (7) TMI 1255 - ITAT MUMBAIGain on sale of shares - business income or capital gain - HELD THAT:- We note that the shares are always valued at cost and assessee never took any benefit of valuation loss for invested shares, even if the market value had fallen below the cost. We note that this accounting practice has been consistently followed by the assessee for several years and is a deciding factor in such matters as held in the case of CIT VS. Gopal Purohit [2010 (1) TMI 7 - BOMBAY HIGH COURT] - Considering the aforesaid facts as well as taking into consideration the CBDT Circular No.04/2007 dated 15.06.2007, we find that the assessee’s intention of buying and selling of shares was that of an investor and therefore, the action of the AO to treat the consideration from sale of shares as business income has been rightly not agreed upon by the CIT(A). We find that there was no new facts before the AO to upset the earlier actions taken by the department to treat the assessee as an investor. So on the principle of consistency also the assessee has made out a case in her favour. Therefore, we are inclined to uphold the order of the Ld. CIT(A) and dismiss the ground of appeal raised by the revenue. Long Term Capital Loss (LTCL) from the off-market share transactions - whether the LTCL claim of the assessee on sale of seven scrips in the off-market transactions can be allowed to be set off and carried forwarded as per the provisions of the Act? - allegation of the AO was that the De-mat accounts of certain buyers of these seven scrips were handled by the share broking company of which the assessee was one of the Director - HELD THAT:- DR could not point out how this allegation of AO has any material bearing in this case. Moreover, it was brought to our notice that the AO in the assessment year for A.Y.2014-15 has accepted the same transaction in the scrutiny assessment u/s 143(2) (except in-respect of three scrips, where the reasons given by AO was that same were executed at a price more than the prevailing market price on the relevant date). We note that the AO has accepted the other transaction carried out by the assessee in the off-market transaction where the price was as per the prevalent market prices. Thus we note that the AO had no objection to off-market transactions per-se for A.Y.2014-15, when the same was transacted off-market. Coming back to the relevant AY 2013-14, it was brought to our notice that all the transactions (except) the scrip of Baroda Rayon where shares were not traded for long and hence market price was not available. Considering the aforesaid facts as well as the case laws in similar case wherein the Tribunal has accepted the off-market transaction of an assessee who had also made the claim of set off of or carried forward, as the case may be was allowed by the Tribunal. - Decided against revenue.
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