Dismissing the appeal of the revenue the Court held that , merely holding shares for a short period will not convert capital gain into business income. This would be contrary to be legislative mandate which itself provides that investment held for less than 12 months is to be termed as short term capital gain. If the assessee has two portfolios, one for “Investment” and other for “Trading” and if the investments are out of own funds and not borrowed funds, the gains have to be assessed as short term capital gains . (CBDT Circular No.4 of 2007 dt. 15 -06-2007 (2007) 291 ITR 384 (St) CIT v. Gopal Purohit (2011) 336 ITR 287 (Bom.) SLP of department rejected (2011) 334 ITR 308 (St) ) (ITA No. 485 of 2016, dt. 26.11.2018) ( AY.2008 -09)
CIT v. Viksit Engineering Ltd (2018) 100 taxmann.com 436 (Bom.)(HC) . www.itatonline.org
S.45: Capital gains – Business income – Merely holding shares for a short period will not convert capital gain into business income-.This would be contrary to be legislative mandate which itself provides that investment held for less than 12 months is to be termed as short term capital gain-If the assessee has two portfolios, one for “Investment” and other for “Trading” and if the investments are out of own funds and not borrowed funds, the gains have to be assessed as short term capital gains [ S.28 (i)]
Sir,
Thank you for the information.
It was very useful to me.