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TMI Blog2013 (8) TMI 174X X X X Extracts X X X X X X X X Extracts X X X X ..... gainst business income treated by the A.O.?" 3. Briefly stated, the assessee, a private limited company engaged in the business of finance services, car hire, administrative services and trading had, during the year under consideration, disclosed following income and loss on account of purchase and sale of shares, securities and units of mutual funds:- Long Term Capital Gain on sale of shares and mutual funds Rs.753847/- Short Term Capital Gain in PMS accounts in mutual funds Rs.630661/- Short Term Capital Loss in PMS account and shares (-) Rs.943093/- The assessee had claimed the LTCG of Rs.7,53,847/- as exempt u/s 10(38) whereas the Net Short Term Capital Loss of Rs.3,12,432/- (9,43,093-6,30,661) has been claimed for carried forward ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nvestment, as even in the latter case, the expenses listed above will be incurred and claimed by the Company, many of them relating to the trading in books, administrative services, hire of car and other sources of income. Even in the case of investor, these items will appear in the Profit & Loss Account without leading to the conclusion drawn by the A.O. The absolute figures of sales and purchases cited by the A.O. cannot lead to a conclusion that the Appellant is trading in shares, as the volume of figures of purchases and sales depend upon the extent of investments made by the Appellant. Even in the case of the Investor, the shares can be sold after brief holding. The sale of shares held by way of investments will also have to be through ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he transactions of the Appellant. In view of the above facts and circumstances, I direct the A.O. to accept the Long Term Capital Gain of Rs.7,53,847/- and Short Term Capital Gain of Rs.6,30,661-/ as shown by the appellant and allow setting off the loss under the head Short Term Capital gain of Rs.9,43,093/-. These grounds of appeal are allowed." Aggrieved by the impugned order, the Revenue is in appeal before us. 4. Before us, the Ld.DR has stated that the order of the Ld.CIT(A) is not focused on the relevant issue and of confusing nature. Further, he relied on the order of the AO in support of the case of Revenue. On the other hand, the Ld. AR has placed his arguments in the similar line of contention earlier taken before the Ld.CIT(A) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ially a question of fact and it has to be determined with regard to the entirety of the circumstances. Where the assessee is engaged in systematic activities of holding portfolio through a PMS Manager, it cannot, by any stretch of imagination, be said that the main object of holding the portfolio is to make profit by sale of shares during the course of maintaining the portfolio investment over the period. The high number of transactions shown in the statement is misleading because these are computer-split transactions and not independent transactions. The decision of the ITAT has been upheld by the jurisdictional High Court in the appeal preferred by the Revenue against the said decision (336 ITR 287). We, relying on the said decision, are ..... X X X X Extracts X X X X X X X X Extracts X X X X
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