TMI Blog2012 (8) TMI 427X X X X Extracts X X X X X X X X Extracts X X X X ..... sive of the fact that the stock valued was not stock-in-trade. The finding of the first appellate authority as well as the Tribunal that the shares held by the assessee, which earned dividend income, constituted stock-in-trade; does not necessarily give rise to a question of law. The appellate authorities having concurred on facts that the dividend income earned by the assessee was eligible to be brought forward as loss of the previous years, in our opinion, cannot be interfered with in this appeal - Decided in favor of assessee. - I.T.A.No.96 of 2000 - - - Dated:- 3-8-2012 - Thottathil B Radhakrishnan And K Vinod Chandran, JJ. For Appellant : Sri P K R Menon, Sr, Adv Sri Jose Joseph, Standing Counsel for Govt. of India For Respo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... States Trading co. P. Ltd. v. C.I.T. [(1971) 80 ITR 21] and also the decision of the Delhi High Court in C.I.T. v. R.Dalmia [(1974) 96 ITR 463] , reversed the disallowance and held that the dividends on shares would form part of income from business. The Tribunal concurred with the first appellate authority. 4. The learned counsel for the assessee Smt.Preetha S.Nair would rely on the above decisions to contend that the assessee being engaged in the business of stock trading, necessarily retain certain stocks in the course of its business; and in the process, would gain dividend on such retention; which could only be treated as income from business and any business loss carried forward could be set off against such dividend income. Both ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l nature, was a mixed question of fact and law. Though the finding for the other assessment years could not be held to be conclusive, the same was held to be good and cogent evidence of the nature of transaction in shares and securities carried on by the assessee even with respect to the relevant year. Holding that no firm conclusion could be drawn from the treatment of such security as "investment" as disclosed in the balance-sheet, it was found that on facts the securities were stock-in-trade and the loss suffered even for the relevant year was a revenue loss. 7. Western State Trading Co. case (supra) was a case in which the assessee owned a colliery, which was sold in the relevant year and together with the issue of the claim of loss i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s as did the assessee in Commissioner of Income-tax v. Bai Shirinbai K.Kooka [(1962) 46 ITR 86 (SC)]". Since in the said case no facts were brought out to show that the company was in any way carrying on business in shares and the business of the company was merely investment with a view to holding them for the purpose of earning dividends, the stock held by the company was held to be not in the nature of business and, hence, was not stock-in-trade. All the decisions cited above were under the Income-tax Act, 1922; but the principle would squarely apply here too. 9. We are of the opinion that the Bengal Assam Investors Ltd. case (supra) is one in which there was nothing to show that the assessee was carrying on business in shares. T ..... X X X X Extracts X X X X X X X X Extracts X X X X
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