TMI Blog2014 (7) TMI 170X X X X Extracts X X X X X X X X Extracts X X X X ..... ssion ” – Decided in favour of Assessee. - ITA No. 3704/Mum/2013 - - - Dated:- 24-6-2014 - Shri I. P. Bansal,JJ. For the Appellant : Shri . Vallabh Gokhale For the Respondent : Shri. B.Yadagiri ORDER Per I. P. Bansal (JM) : This is an appeal filed by the assessee. It is directed against the order passed by Ld. CIT(A)-3, Mumbai dated 31/05/2011 for assessment year 2006-07. The grounds of appeal read as under: The grounds set out hereunder are without prejudice to one another: 1. Treatment of income from sale of shares as Business Income instead of Capital Gains (a) The learned Commissioner of Income-tax (Appeals) - 3 ( CIT(A) ) erred in confirming the action of the Income Tax Officer-11(2)(1), Mumbai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... term capital gain had arisen to assessee from sale and purchase of shares. The purchase and sale of the shares by the assessee were to the tune of ₹ 68,47,116/- and ₹ 71,33,098/- respectively. It was also noticed that number of sale transactions were 58 and period of holding in nine instances was less than one day. The balance 37 transactions the period of holding was within a month and in five transactions the sales were effected next day. On these facts, Ld. AO relying upon Circular of Board dated 15/6/2007 and also certain judicial pronouncements has arrived at a conclusion that the transactions of sale and purchase of shares entered into by the assessee were in the nature of business. He, therefore, discarded the claim of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mentioned grounds of appeal. 4. At the time of hearing Ld. AR submitted that so far as it relates to grievance of the assessee with regard to Ground No.1(a), the assessee has nothing to say more. As this ground was not seriously contested by Ld. AR, Ground No.1 is dismissed. 5. Apropos Ground No.1(b), it was submitted by Ld. AR that assessee has also earned long term capital gain on similar transactions, which was to the tune of ₹ 26,351/-. He in this regard referred to the computation of income placed at page 3 4 of the paper book. It was submitted that it is not permissible to A.O to give different treatment to the transactions which are similar in nature. Ld. A.O has accepted the claim of the assessee regarding similar tran ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e. He submitted that seeing the volume of transactions and intra-day trading done by the assessee, Ld. CIT(A) was right in holding that the transactions have given rise to income from business. He submitted that assessee also borrowed funds to make investment in the shares from her husband and thus, the transactions were done with a motive to earn profit. 7. In the rejoinder it was submitted by Ld. AR that though there is a borrowing from the husband of the assessee but the borrowing did not carry any interest and the borrowing was interest free. 8. I have heard both the parties and their contentions have carefully been considered. The transactions entered into by the assessee have been summarized in the shape of a chart, copy of whic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nting to ₹ 2,08,775.66. Keeping in view the facts of the case as brought out in the aforementioned chart, I am of the opinion that the transactions entered into by the assessee cannot be treated to be transactions giving rise to income under the head profit and gains from business or profession . The shares have been shown under the head investment . The department has accepted long term capital gain shown by the assessee in respect of similar transactions giving rise to income under the head capital gain. Therefore, keeping in view the entirety of these facts, I am of the opinion that gain earned by the assessee from transactions of shares upon which assessee has earned gain of ₹ 2,08,775/- (as per computation in the chart) c ..... X X X X Extracts X X X X X X X X Extracts X X X X
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