ACIT 21(1), MUMBAI vs. NAILESH P. DALAL, MUMBAI

आदेश / O R D E R

Per Joginder Singh (Judicial Member) The Revenue is aggrieved by the impugned order dated 24/07/2014 of the First Appellate Authority, Mumbai, whereas, the assessee has preferred cross objection.

3. During hearing, at the outset, the learned counsel for the assessee Shri Deepak N Kanabar contended that the impugned issue is covered in favour of the assessee for 3 CO No.46/Mum/2014 Nailesh P Dalal A.Y.2006-2007 (ITA No. 3337/Mum/2009). It was also explained that no borrowed funds were utilized by the assessee for making the investment and long term capital gain was accepted by the department and only dispute is with respect to short term capital gain. This factual matrix was not controverted by the learned DR.

“This appeal is preferred by the Revenue against the order of ld. CIT(A) - XXI, Mumbai dated 20-03-2009 for assessment year 2006-07 and the same is being disposed of along with the cross objection filed by the assessee.

4 CO No.46/Mum/2014 Nailesh P Dalal Short term capital gains from 01-04-2004 to 30-09-2005 No of shares bought and sold 2,51,604 Purchase amount 1,06,04,746 Sales Amount 1,63,73,121 No. of scrips 31 Total gains 57,68,375 Short term capital gains from 01-10-2005 to 31-03-2006 No of shares bought and sold 1,72,608 Purchase amount 1,90,72,340 Sales Amount 2,16,52,571 No. of scrips 18 Total gains 25,80,231 Total summary of Short term capital gains from 01-04-2005 to 31-03-2006 4,24,212 No of shares bought and sold 2,96,77,086 Purchase amount 3,80,25,692 Sales Amount 49 No. of scrips 83,48,606 Total gains On perusal of the above details furnished by the assessee, the A.O. was of the view that keeping in view the back ground of the assessee, regularity, volume, turnover of the transactions and the period of holding of shares, the profit earned by the assessee from the transactions in shares constituted business income of the assessee and not the capital gains as claimed in the return of income. He, therefore, required the assessee to offer his explanation in the matter which the assessee furnished vide his letter dated 6-10-2008 as under:-

“I have been an investor for the last 30 years and have been filing my returns regularly as an investor. Since the very first return I have been declaring all the investments in detail including purchases, sales and holdings as at the beginning as well as at the end of the financial year. I have taken all the shares at original rates and have never

5 CO No.46/Mum/2014 Nailesh P Dalal claimed any mark to market profits or losses against my investment shown under STCG and LTCG. I have made this investment out of my own funds and I have not availed of any credit facilities from any banks. I have taken delivery of all the shares for which I have booked short term capital gains. This can be verified from the copies of the enclosed demat statements. There were transactions in only 51 scrips declared under STCG. These were carried out through recognized stock exchanges. The securities transaction tax has been duly paid on all the transactions.” It was further submitted before the A.O. that the assessee was working as full time Director of M/s Dalal Broacha Stock Broking Pvt. Ltd. earning a salary of Rs. 52 lacs and he was not in a position to devote any time to carry on the business of trading in shares. It was submitted that the transactions in purchase and sale of shares were being done by the assessee as an investor and the profit earned from such transactions offered to tax under capital gain was accepted by the Department in the past. It was also submitted that the assessee had made the entire investment in shares out of his own funds and there was no amount borrowed for the purpose of making the said investment. It was pointed out that the assessee had entered in to purchase and sale transactions in only 39 scrips out of which 16 scrips were held in the form of opening investment. It was contended that the scale of this activity could not be said to be substantial and the transactions were also not entered into continuously and regularly during the year under consideration. It was also pointed out that the typical holding period of the shares as given in the statement of long term capital gain was between two to ten years while the said in the case of short term capital gain was more than six months. It was contended that the intention of the assessee thus was always to stay invested and earn dividend income over a period. Relying on the various judicial pronouncements cited before the A.O. as well as referring to the CBDT Circular No. 4/2007 issued on 15-6-2007, it was contended on behalf of the assessee that all the relevant facts and circumstances of the case should be taken into consideration to decide the intention of the assessee to acquire and hold the shares and if such intention is found to be that of making investment in shares rather than trading in shares, the profits arising from the transactions in shares should be assessed as capital gain.

4. The submissions made by the assessee were considered by the A.O. in the light of certain tests laid down in various judicial pronouncements as well as in the Circular issued by the CBDT in order to distinguish between shares

6 CO No.46/Mum/2014 Nailesh P Dalal held as stock-in- trade and shares held as investment. In this regard, he recorded his findings/observations as under:-

“(1) Whether the purchase and sale of securities was allied to his usual trade or business/ was incidental to it or was an occasional independent activity. The assessee is having predominant activity of buying and selling of shares where the transactions were entered into continuously, regularly and systematically during the assessment year under consideration.

(ii) Time devoted to the activity and the extent to which it is the means of livelihood. In the given case the share trading activity is the only activity being undertaken b the assessee and is a whole time occupation for the assessee. This is strengthened by the fact that the salary income from the company is in lieu of the share trading activity of the company. The nature of the business of company and individual is the same.

(iii) Whether scale of activity is substantial. The scale of activity is definitely substantial in the case of the assessee. The number of transactions and the quantum of sale and purchase of shares have been elaborated in the earlier paras of this assessment order from where it is clear that both the number and quantum of transactions are substantial. Holding period of securities bought and sold and frequency of transactions. It will not be out of place to mention even at the cost of repetition that taxability of transactions will not depend on presentation of accounts or by showing the shares as investment. It will depend on the facts of the case. The volume, frequency and regularity of share transactions done in organized manner indicate business activity.”

On the basis of above findings/observations recorded by him as well as relying on various judicial pronouncements explaining the meaning of the word “business”, the A.O. held that the assessee was mainly engaged in the activity of earning profit through purchase and sale of shares and such profits therefore was chargeable to tax in his hands as business income and not capital gain. Accordingly, such profit declared by the assessee as short term capital gains and long term capital gains was entirely brought to tax by the A.O. in the hands of the assessee as business income in the assessment completed u/s 143(3) of the Income Tax Act, 1961 vide an order dated 21-11- 2008.

7 CO No.46/Mum/2014 Nailesh P Dalal Against the order passed by the A.O. u/s 143(3) of the Act, appeal was preferred by the assessee before the ld. CIT(A) and the following submissions were made on behalf of the assessee before the ld. CIT(A) in support of his case that the transactions in shares were entered into as investor and not as trader and the profit arising from shares was chargeable to tax as capital gain and not business income:-

That the general principles of law applicable, for determining when certain activities constitute a business or are on capital or investment account, would have to be applied to the activities of share investing in order to determine whether the transactions result in a business income or capital gains. There is no express provision in the law to determine when an activity is one of investment and when it constitutes a business. The guidance that is available in the Income tax Act is basically in the form of the inclusive definition of the term “business under section 2(13). This definition does not provide much guidance so far as determining whether share transactions constitute a business or not, since the definition is inclusive definition and therefore merely illustrative and not all-embracing.

(ii) That the appellant is the director of M/s Dalal & Broacha stock Broking Pvt Ltd., since more than 10 years. The appellant has received Rs,52,00,000/- as salaries from this company. For this purpose the appellant is required to devote his full time and energy towards the activity of the Company. Therefore, there cannot be any other systematic business activities carried by the appellant except as the employee of the company. The appellant is required to attend to the clients of the company between 9.00 AM to 4.00 PM related to securities transaction of BSE & NSE. Thereafter, he is required t look into the collection of dues from he clients and settlement of account with the stock exchanges the next day. A typical working day extends from 8.00 AM to 8 PM devoted wholly to the affairs of the company. Therefore, the appellant cannot carry out this activity as a primary occupation.

(iii) That the livelihood of the appellant does net depend upon the returns on Investment as income from salary is much higher than the returns of the Investment in most number of years. Therefore it cannot

8 CO No.46/Mum/2014 Nailesh P Dalal be said that the appellant s in the business of trading of shares / securities.

(iv) That, as the company in which the appellant is an employee is in the business of brokerage on BSE or NSE, the appellant carries out occasional transaction on personal account. Thu investments in ITA shares, units of mutual funds, government securities, debentures, unlisted companies and listed equity shares are independent of activities of the Company. If a company can be both a trader as well an investor, then why an individual cannot be attached to a broking firm and still he an investor in individual capacity. v) That the appellant has been filling his return of Income from year to year for the past more than 25 years along with computation of income wherein similar transaction in sale and purchase of shares on both long term and short term basis have been duly accepted by the department as an investor. Though the principle of res judicata does not apply to income tax proceedings as each year is independent year of assessment, however, in order to maintain the consistency, it is judicially accepted principle that same view should he adopted for the subsequent year, unless there is a material change in the facts. This principle has been followed by Mumbai ITAT in Janak S Rangwala V ACIT 2007 - 11 SOT 627 (Mum.) (Pg.58-60 of APB). vi) That similar issue came up for consideration by the Bombay bench of ITAT Bombay Gymkhana VS. ITO (IT Appeal No. 249 of 2005 pronounced on 31.10.2007). It was held that in the instant case, the real question that came up for consideration was as to whether the first step, i.e. purchase of shares was in the course of trading transaction or in the course of investment. It was seen that the purchase of units was made as investment and the same was shown by the appellant in its books of account as investment and in earlier years, said stand of the appellant was accepted by the department. If the purchase of units was accepted as purchase in course of investment, at the time of sale thereof, income arising on sale had to be assessed as capital gain and it could not be assessed as business income merely for the reason that quantum was high or the number of transactions was high. Following more judgments along with copies of the orders were furnished by the ld. A.R. of the appellant.

9 CO No.46/Mum/2014 Nailesh P Dalal a) CIT vs. Lagan Kala Upavan : (2003) 259 ITR 489(Del) Pg 70-71 b) CIT vs. A.R.J.Security Printers : (2003) 264 ITR 276 (Del) Pg72-73 c) DIT vs. Lovely Bal Shiksha : (2004) 236 ITR(Del) Pg 74-75 d) CIT vs. H.P.Cotton Textile Mills Ltd : IT Appeal No. 264 of 2007 Pg 76.77 e) DIT vs. Escorts Cardiac Diseases Hospital Society IT Appeal No.28/2006 Pg 78-79 f) CIT vs. Dalmia Promoters Developers: ITAppeal.No.755 of 2005 Pg 8041 g) CWT vs: Allied Finance (P) Ltd. (2007) 289 ITR 318(Del) Pg 82- 83 h) CIT vs. Sood harvester (2008) 304 ITR 279 Pg 84-85 i) Pukhraj Rikhabdass vs. CWT: (1995) 203 ITR 770 (Raj) Pg 86-87 j) CIT V India Forge & Drop Stamping Ltd. (1999) 240 ITR (Mad) Pg 88-89 vi) That the appellant has been assessed to tax u/s 143(3) in the proceeding assessment year i.e. assessment years 2004-05 wherein the shares /MF Units sold during the previous year have been accepted as Capital Gains / Loss Further the appellant has been filling Income tax returns since’ last 25 years along with Balance Sheet and detail groupings of Capital account, Cash and Bank Balances, Investments, other Assets in Liabilities. The I.T department has accepted the classification of assets as well as the heads of Income in the computation filed with the return of Income. It appears that just because the appellant has earned relatively high amount of profit on sale of shares during the year, the A.O. has overturned the classification of assets accepted all through the past 25 years, which should not be permitted. vii) That the appellant has made all the investment out of his own Funds/ Capital and that not borrowed any amount for the purpose of investment in shares/securities. This indicates that the appellant never

10 CO No.46/Mum/2014 Nailesh P Dalal intended to leverage his assets by obtaining loans based an the assets and making investments in shares based on loan funds, which even the appellant understands that it would be liable to be treated as business as the dividends are much smaller compared to the interest liability that may be incurred. viii) That the appellant has entered into purchase/shares transaction resulting into capital gains in 39 scrips, of which purchases pertaining to 16 scrips were in the form of opening investments. The purchases relating to these investments were showr3 as closing investment in preceding previous year and same has been accepted as investment. Therefore total number of stock dealt in by the appellant can not be called substantial number of stock as the number of scrips listed on both the stock exchanges are in excess of 10,000 companies Therefore, the scale of activity cannot be said to be substantial and the transactions are also not entered into continuously and regularly during the previous year. On the basis of the decision of Jurisdictional Tribunal in the case of Bombay Gymkhana V ITO (ITA No. 249 of 2005) dated 31.10.2007, it must be held that whatever has already been shown and accepted purchase in course of Investment in the earlier year cannot be treated as business / trading activity at the time of sale even if quantum and/ or the frequency of transaction is high. ix) That, as regards the ratio of sales to purchases and holding, it is stated that the appellant has sold investment worth Rs.529 as against opening stock and purchase worth Rs. 818 lacs. This works out to sale purchase ratio of 0.64 1. In a typical trading situation this would be much higher as the trader maximizes his returns as his turnover increases. x) That typical holding period of the investment by the appellant is normally between 2-10 years. This is evident from the statement of long term capital gain amounting to 31,18,439 submitted herein. Even in the short term capital gain the average period exceeds 6 months. The intention of 1ie appellant has always, been to stay invested and earn dividends over a substantial period of time. However, during the previous year there was unprecedented boom on the stock market which led to amendment in the holding period of the appellant. Further, the appellant has earned dividends of Rs. 3.50 lacs during

11 CO No.46/Mum/2014 Nailesh P Dalal the year which indicates that the predominant motive was to earn dividends and not to trade in the securities. xi) That the transactions have all been paid or received for and is not merely reflected by book entries. The assessee has taken delivery in case of purchases and give delivery for sales. These are not merely book entries. Even the Payments have been made out of own funds at every stage. xii) That the dominant object of the appellant was to get out of the volatile equity investment to more stable Mutual Funds / RBI Relief Bonds Investments. This is evident from the fact that out of proceeds of sale of equity, the appellant has bought MF Units worth 74,96,000 and RBI Relief Bonds worth Rs. 14,46,000 thereby handing over the Investments to professional financial advisors and the RBI fot earning dividends / tax free interest rather than the equity markets where the risk to returns are very high.”

6. The ld. CIT(A) found substance in the submissions made on behalf of the assessee. According to him, the following submissions made by the assessee were sufficient to successfully rebut all the objections raised by the A.O. in his impugned order “The appellant’s activity may be called regular, but not systematic. Further, the large number of transaction are small in quantum and value and scale of activity does not justify such conclusion. Further, the appel1ant would not require much infrastructure to carry out these litany transactions as in present times the traisaction3 are made either online through web or on telephone lines which invoices meager investment. ii) The appellant is a full time employee drawing a salary of Rs.51,90,000 and expected to devote full time and energy to the business of company. Hence, the AO’s contention that the appellant is in full time activity of trading is not tenable. In any case, it has been held by various judicial authorities and CBDT’s Circular No.4.2007 that a person can have both activities i.e trading as well as investments. Therefore, a person working in a share market related firm can also be an invest in his personal capacity.

12 CO No.46/Mum/2014 Nailesh P Dalal iii) The appellant has been held to be an investor in the past many years and an assessment order for A/Y 2004-05 passed u/s 143(3) clearly indicates that he has been accepted as an investor throughout the period. The appellant has also been Filing a detailed balance sheet alongwith the Return of Income clearly showing the shares as investment and as not as inventory. iv) That the appellant’s financial position is not at leveraged and the entire investment is coming out of his own funds. This kind of situation is very rare in case of business activity us the business is always looking to increase its turnover with someone else’s money. v) Circular No. 4/2007 dated 15.06.2001, while dealing with the ratios laid down by the Hon’ble Supreme Court, lays down three principles which are required to be ascertained. First principle is regarding Memorandum & Articles of Association, which is not applicable to the appellant, being an Individual. The second part of this principle requires that a verification be done whether the shares were shown as stock-in- trade or were shown as investment in capital assets. The appellant clearly fulfills this requirement as he has over number of years been showing his shares / securities as investments which is not even disputed by the AO. Second Principle is o ascertain that nature of transactions, its magnitude and ratio between purchase and sales and the holding. The appellant has brought the fact that the magnitude of the transaction is not large by any standard as there are only 64 scrips in the whole year. Further, even the ratios of purchase to sale (cost) is approximately 0. 90 : 1 i.e. purchase are almost as much as that of sales another ratio on opening stock + purchases to sales 1.97: Therefore, this principle also is met. Third Principle is about the motive. To this the appellant has provided a detailed analysis of various sources of income for past 5 years and contends that dividends and interest from bonds constitutes a major source of ins income and it is higher than even capital gains in 2 out of 5 years. During the year also the appellant has earned Rs. 9,93,438/- as dividends. In addition to the above the appellant contends that even for sale of shares the dominant objective was to get out of the volatile share investments and get into debt / equity mutual fund which are much more stable and managed by professional fund managers. This is evident from the fact that he has purchased MF units worth Rs.89.42 lacs out of toe total purchase of Rs.217.36 Lacs. This 13 CO No.46/Mum/2014 Nailesh P Dalal sufficiently explains the motive of investments as well as the sale of share during the previous year. vi). The Circular further states that it is possible for an assessee to have both trading as well as investment portfolio. It goes on to say that Assessing Officer are advise that no single principle would be decisive and total effect of all the principle should be considered to determine whether in a given case the shares held by the assessee are investment or stock in trade. This means that the AO should not base his assessment on one single criteria but must bring out totality of facts before making an assessment contrary to the claim of the assessee. vii) Last but not the least, the appellant contended that his average holding period for LTCG has been 2 to 10 years and that of STCG is 6 months.”

On the basis of the above discussion, the ld. CIT(A) held that the transactions in shares entered into by the assessee giving rise to long term capital gains were entirely made as investor. Accordingly, he directed the A.O. to allow the claim of the assessee for long term capital gains of Rs. 31,18,439/-. As regards the claim of the assessee for short term capital gains, the ld. CIT(A) held that the same was acceptable to the extent it was relating to the transactions in shares held by the assessee for more than one month and the balance profit earned by the assessee on sale of shares held for more than one month was chargeable to tax as business income of the assessee. Accordingly, he directed the A.O. to accept the claim of the assessee for short term capital gain to the extent of Rs. 76,34,570/- out of short term capital gain of Rs. 83,60,088/- offered by the assessee. The action of the A.O. in treating the balance short term capital gain of Rs. 7,25,518/- as business income of the assessee was upheld by the ld. CIT(A).

8. The ld. D.R. strongly relied on the order of the A.O. in support of the Revenue’s case on the issue. He submitted that although the 14 CO No.46/Mum/2014 Nailesh P Dalal assessee was a full time Director of M/s Dalal Broacha Stock Broking Pvt. Ltd., the said company was also engaged mainly in the business of trading in shares. He contended that the prime activity of the assessee thus was buying and selling of shares which was clearly evident from the continuous, regular and systematic transactions entered into by the assessee in shares on personal account too. He submitted that the motive of the assessee, as clearly pointed out by the A.O., behind purchase of shares was to sell them subsequently after lapse of some time to make profit and this motive was sufficient to establish that the transactions in shares were made by the assessee as trader and not as investor. He contended that the profit earned by the assessee on the transactions in shares thus was chargeable to tax as business income as rightly held by the A.O. and the ld. CIT(A) was not justified in treating the same as capital gain.

15 CO No.46/Mum/2014 Nailesh P Dalal book to show that the average period of holding in the case of shares giving long term capital gain was 1214 days while it was 129 days in the case of short term capital gain. He also invited our attention to the details of total income earned by the assessee during the immediately preceding five years given at page 51 of his paper book to show that the major source of income of the assessee was not capital gain. He contended that the assessee was treated as investor in shares in all the earlier years by the Department and there was no justifiable reason for the A.O. to change the said treatment. He contended that the ld. CIT(A), on the other hand, has rightly considered all the relevant facts of the assessee’s case to treat him as investor in his order. In support of his contention, the ld. counsel for the assessee relied on various judicial pronouncements including the decision of the Tribunal in the case of assessee’s son Hriday Nailesh Dalal rendered vide order dated 30-4-2010 passed in wherein the order of the ld. CIT(A) treating the profit arising from the transactions in shares as capital gain was upheld by the Tribunal in the similar facts and circumstances.

“(1) What is the intention of the assessee at the time of purchase of the shares. This can be found out from the treatment it gives to such purchase in its books of account. Whether it is treated as stock-in-

16 CO No.46/Mum/2014 Nailesh P Dalal trade or investment? Whether shown in opening/closing stock or shown separately as investment or non-trading asset?

(2) Whether assessee has borrowed money to purchase and paid interest thereon. Normally, money is borrowed to purchase goods for the purpose of trade and not for investing in an asset for retaining.

(3) What is the frequency of such purchases and disposal in that particular item? If purchase and sale are frequent, or there are substantial transactions in that item, it would indicate trade. Habitual dealing in that particular item is indicative of intention of trade. Similarly, ratio between the purchases and sales and the holdings may show whether the assessee is trading or investing (high transactions and low holdings indicate trade whereas low transactions and high holdings indicate investment):

(4) Whether purchase and sale is for realizing profit or purchases are made for retention and appreciation in its value. Former will indicate intention of trade and latter, an investment. In the case of shares whether intention was to enjoy dividend and not merely earn profit on sale and purchase of shares. A commercial motive is an essential ingredient of trade.

(5) How the value of the items has been taken in the balance sheet? If the items in question are valued at cost, it would indicate that they are investments or where they are valued at cost or market value or net realizable value (whichever is less), it will indicate that items in question are treated as stock-in-trade.

(6) How the company (assessee) is authorized in memorandum of association/article of association? Whether for trade or for investment? If authorized only for trade, then whether there are separate resolutions of the board of directors to carry out investments in that commodity? And vice versa.

(7) It is for the assessee to adduce evidence to show that his holding is for investment or for trading and what distinction he has kept in the records or otherwise, between two types of holdings. If the assessee is able to discharge the primary onus and could prima facie show that 17 CO No.46/Mum/2014 Nailesh P Dalal particular item is held as investment for say, stock-in-trade), then onus would shift to Revenue to prove that apparent is not real.

(8) The mere fact of credit of sale proceeds of shares (or for that matter any other item in question) in a particular account or not so much frequency of sale and purchase will alone will not be sufficient to say that assessee was holding the shares for the items in question) for investment.

(9) One has to find out what are the legal requisites for dealing as a trader in the items in question and whether the assessee is complying with them. Whether it is the argument of the assessee that it is violating those legal requirements, if it is claimed that it is dealing as a trader in that item? Whether it had such an intention (to carry on illegal business in that item since beginning or when purchases were made?

(10) It is permissible as per CBDT’s Circular No. 4 of 2007 of 15th June, 2007 that an assessee can have both portfolios, one for trading and other for investment provided it maintaining separate account for each type, there are distinctive features for both and there is no intermingling of holdings in the two portfolios. (11) Not one or two factors out of above alone will be sufficient to come to a definite conclusion but the cumulative effect of several factors has to be seen.”

18 CO No.46/Mum/2014 Nailesh P Dalal turnover which could happen only in the case of an investor and not in the case of trader in shares. The average period of holding of shares giving rise to long term capital gain was 1214 days while the same was 129 days in the case of shares giving rise of short term capital gain which again goes to show that the shares were held by the assessee for a considerably long period before the sale showing low frequency. The investment portfolio of the assessee was comprising of mutual funds, shares of unlisted companies etc. and this pattern of investment further shows that the assessee was investor in shares and securities and not a trader. All the investments made by the assessee in shares and securities were consistently valued at cost which further shows that the shares were treated by the assessee as investment and not stock-in-trade. The assessee was a working director in M/s Dalal Broacha Stock Broking Pvt. Ltd. earning a remuneration of Rs. 52 lacs and although the said company was engaged in the business of trading in shares, the fact that he was in full employment of that company shows that he was not left with sufficient time to carry on the business of trading on shares on his personal account. In our opinion, if all these relevant facts of the assessee’s case are taken into consideration in totality, it becomes abundantly clear that the transactions in shares were made by the assessee as in investor and not as a trader and the profit earned by him from the said transactions was capital gains and not business income as rightly held by the ld. CIT(A). We, therefore, find no infirmity in the impugned order of the ld. CIT(A) directing the A.O. to treat the profit earned by the assessee from share transactions as capital gains and upholding the same, we dismiss this appeal filed by the Revenue.

19 CO No.46/Mum/2014 Nailesh P Dalal Court in CIT vs. Gopal Purohit (2010) 188 Taxman 140 (Bom.), CIT vs. Merlin Holdings Pvt. Ltd. (2015) of 2011 (Cal.), Gopal Purohit vs. JCIT 29 SOT 117 (Mumbai ITAT); Janak S Rangwala vs. ACIT (2007) 11 SOT 627 (Mum) and various other decisions already deliberated upon in the aforesaid order, we find no infirmity in the conclusion of the learned CIT(A). Therefore, the appeal of the revenue is dismissed.

Following the aforesaid order in Cross objection also, the 7. cross objection raised by the assessee is also allowed as there is no change in the relevant facts. Therefore, direct the Assessing Officer to treat the profit earned on sale of shares, held for less than one month, as short term capital gain.