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TMI Blog2012 (7) TMI 65X X X X Extracts X X X X X X X X Extracts X X X X ..... ta Consultancy Services Ltd. The assessee also carried on profession as trainer in computer software and carries on such activities as proprietor of M/s Om Enterprises. The assessee has been investing his surplus funds in various instruments including shares and securities. During the year under consideration, the assessee filed his return of income on 30/10/2006 declaring total income at Rs. 16,52,310/-, which was accepted u/s 143(1) of the Act. Subsequently, the case was selected for scrutiny and completed the assessment u/s 143(3) determining the total income of the assessee at Rs. 46,82,880/-, while doing so, the AO assessed the long term capital gain admitted by the assessee under the head business, which is the subject matter in this ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed under the head 'business'. He further held that the assessee maintained the books of account in a business like manner and expenses such as accounts of loans and advances taken, copies of ledger account with broker, interest paid, received etc. are maintained. Accordingly, the AO assessed the entire profit arising out of purchase and sale of shares/mutual fund units admitted as 'long term capital gain', under the head 'business'. Aggrieved, the assessee carried the matter in appeal before the CIT(A). 4. Before the CIT(A) the AR of the assessee submitted that the assessee is holding the post of Vice President in Tata Consultancy Services and had to travel in India and abroad frequently leaving very little time for trading in shares and s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or treating the profit under the head business. He further pointed out that as per the balance sheet, the total investment is Rs. 1,41,42,301/- out of which Rs. 95,02,709/- represents investment like bonds, super annuation fund, LIC premium, PF maintained by the employer and only a sum of Rs. 36,45,316/- was invested in the form of bullion, units of mutual fund and shares. He submitted that long term capital gain included Rs. 2,44,763/- on sale of units of mutual fund. He further submitted that some of the shares were held for more than two years. He finally submitted that principle of consistency should be followed as held by Hon'ble Mumbai Tribunal in the case of Gopal Purohit Vs. JCIT, 29 SOT 117. After considering the submissions of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... om the above, it is clear that as against the total long term capital gain of Rs.25,08,196/-, major portion i.e.Rs.19,22,696/- is Out of sale of units in mutual fund and sale of TCS shares which were allotted to the appellant under ESOP. The remaining shares are negligible and in fact the appellant held some of the shares for more than two years as seen from the long term capital gain working. The appellant has paid STT at the rate applicable to the investor. In view of the above facts, I hold that the long term capital gain admitted has to be accepted especially when the A. has accepted such long term capital gain in A. Y.2004-05 while completing the assessment u/s.143(3). I accept the plea of the of Gopal Purohit vs.JCIT (cited above) hel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e at all appropriate to allow the position to be chanced in a subsequent year." The same view, has been 'taken. by the Hon'blë Delhi Court in CIT V. Neo Poly Pack (P) Ltd [2000] 245 ITR 492. Further the Hon'ble Mumbal Tribunal in the case of Gopal Purohit (29 SOT 117) held that the delivery based transactions are to be treated as investment and there can be two types of transactions i.e one activity of investment and other activity of jobbing without delivery. 5.2 In the light of above jurisdictional Tribunal decisions and the factual findings given above, I direct the A.O. to accept the claim of the appellant that the profit on sale of shares held for more than 12 months is assessable under the head long term capital gain." Aggriev ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d sale of shares held for more than 12 months also treated as the head business. On the other hand, the CIT(A) after examining the facts of the case, directed the AO to accept the claim of the assessee that the profit on sale of shares held for more than 12 months is assessable under the head 'long term capital gain'. It is observed from the facts of the case that for AY 2004-05, the AO while completing the assessment u/s 143(3) on 31/10/2006 accepted the claim of long term capital gain and even converted the business income admitted in respect of shortterm- capital-gain. It is seen from the balance sheet that investment in shares was shown under the head investment and the investment in shares stood at Rs. 29,17,660/- as on 31/03/2006 as a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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