The assessee which is engaged in manufacturing of chemicals and gases has claimed gain arising from sale and purchase of shares as capital gains. The AO held that turnover of sale of shares is more than the turnover of sale of gas assessed the gains on sale of shares as business income.  Appellate Authority allowed claim of assessee. On appeal by revenue the Court held that  that memorandum of association of assesse company clearly showed that business of purchase and shares and securities was not main object of company and assessee had also maintained distinction between trading assets and non-trading assets in books of account and only net surplus or loss arising out of shares and securities was reflected in profit and loss account  and since the assessee had continuously treated transaction in shares and securities as investment, Assessing Officer could not have treated same as business transaction so as to treat surplus as business income.    (AY.  2005-06 to 2011-12).