TMI Blog2018 (4) TMI 83X X X X Extracts X X X X X X X X Extracts X X X X ..... conversion of stock-in-trade into investment is to be treated as ‘business income’ and accordingly to be taxed. In view of the above findings of Ld. CIT(A) that the income from investment is to be taken as ‘capital gains’ and conversion of stock-in-trade into investment is to be taken as ‘trading income’, which is based on facts of the case and need no disturbance - Decided against revenue - I.T.A No. 171/Kol/2016 - - - Dated:- 7-3-2018 - Hon ble Shri Aby. T. Varkey, JM And Shri M.Balaganesh, AM For the Appellant : Shri Sallong Yaden, Addl. CIT For the Respondent : Shri S. Jhajharia, FCA ORDER Per M.Balaganesh, AM 1. This appeal by the Revenue arises out of the order of the Learned Commissioner of Income Tax(Appeal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... th bank. It also earns dividend icnoem from investment in shares and securities. During the year under appeal, the assessee company had claimed business loss at ₹ 19,40,817/- as well as capital gain of ₹ 98,35,801/- and LTCG of ₹ 1,38,27,474/-. It was replied that the shares were held by assessee as investment only in the audited accounts and hence the gain has to be assessed as capital gains only and it has only one portfolio. All the investments were made out of assessee s own funds and no amount was borrowed for making investments. The assessee in support of its arguments placed reliance on various decisions of High Courts and Tribunals. The ld AO on perusal of the objects in the Memorandum of Association of the assesse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t on the facts and circumstances of the case, the Ld. CIT(A) has erred by ignoring that the assessee has carried out its activities of share transactions in a systematic and organized manner and effected sale of shares at an opportune moment and arranged the transaction as per its own whims and fancy in its books of accounts to lower the tax incidence. 3. That the appellant craves leave to add/alter/modify the grounds of appeal before or at the time of hearing. 6. The ld DR vehemently relied on the order of the ld AO. In response to this, the ld AR stated that the issue under dispute is covered by the decision of this tribunal in assessee s own case for the Asst Years 2005-06 vide order dated 1.7.2015 and for Asst Year 2007-08 vi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Accordingly, the profit that has been attributable to this trading activity corresponding to conversion of stock-in-trade into investment is to be treated as business income and accordingly to be taxed. In view of the above findings of Ld. CIT(A) that the income from investment is to be taken as capital gains and conversion of stock-in-trade into investment is to be taken as trading income , which is based on facts of the case and need no disturbance. Accordingly, we confirm the findings of Ld. CIT(A). Respectfully following the same, we hold that the profit on sale of shares and mutual funds could be assessed only as capital gains (LTCG and STCG) depending upon the period of holding. Accordingly the grounds raised by the revenue ..... X X X X Extracts X X X X X X X X Extracts X X X X
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