CIT v. H. Holck Larsen

Vidyasagar M.P Sah, Mumbai vs. DCIT 23(3), Mumbai

In the result, this appeal by the assessee stands dismissed

Bench: Shri Shamim Yahya, Am & Shri Ram Lal Negi, Jm आयकर अपील सं./I.T.A. No. 527/Mum/2016 ("नधा"रण वष" / Assessment Year: 2012-13) Vidyasagar M. P. Sah Dy. Cit-23(3), बनाम/ 22-A, Bandstand Society, Matru Mandir, Tardeo Road, 197-C, Kane Road, Bandra (W), Mumbai Vs. Mumbai-400 050 "थायी लेखा सं./जीआइआर सं./Pan/Gir No. Aafps 5412 H (अपीलाथ" /Appellant) (""यथ" / Respondent) : अपीलाथ" क" ओर से / Appellant By : Shri Ajay R. Singh ""यथ" क" ओर से/Respondent By : Ms. Aarjoo Garodia सुनवाई क" तार"ख / : 04.12.2017 Date Of Hearing घोषणा क" तार"ख / : 04.12.2017 Date Of Pronouncement आदेश / O R D E R Per Shamim Yahya, A. M.: This Appeal By The Assessee Directed Against The Order By The Commissioner Of Income Tax (Appeals)-34, Mumbai (‘Cit(A)’ For Short) Dated 12.01.2016 & Pertains To The Assessment Year (A.Y.) 2012-13. The Grounds Of Appeal Read As Under: 1. Short Term Capital Gain Of Rs.3,51,66,426/- Treated As Business Income 1. The Learned Cit(A) Erred In Treating The Short Term Capital Gain Of Rs.3,51,66,426/- As 'Business Income1 Without Appreciating The Crucial Facts That The Assessee Is A Professional / Consultant For Exploration & Drilling Activities For Oil Wells / Rigs Etc. Which Is The Principal Source Of Income Since 32 Years, Wherein He Has To Devote Maximum Time & The Activity Has Been Accepted By The Department In All The Prior Years As Well As In The Relevant

…ows: '13. It is held that whether a transaction of sale and purchase of shares were trading transactions or they were in the nature of investment is a mixed question of law and facts as held by the Hon'ble Supreme Court in the case of CIT vs. H. Hoick Larsen 160 ITR 67. It is further held in the case of CIT vs. Associated Industrial Development Co. P. Ltd. 82 ITR 586 that it is possible that the assesses to be both an investor as well as dealer in shares. Whether a particular holding is by way of investment or form part of stock-in-trade is a mater within the knowledge of the assesses and it is for the assessee…

Mahalaxmi Innovative Services Ltd, Mumbai vs. DCIT Cir 2(2), Mumbai

The appeal of the assessee is partly allowed in light our aforesaid observations

Bench: Shri D. Karunakara Rao, Am & Shri Ravish Sood, Jm आयकर अपील सं./ I.T.A. No. 4856/Mum/2011 (निर्धारण वर्ा / Assessment Year: 2007-08) Mahalaxmi Innovative Services Ltd. Dcit Cir 2(2) बिधम/ 1004, 10Th Floor, Maker Chambers-V, Mumbai Nariman Point Vs. Mumbai, स्थायीलेखासं./जीआइआरसं./Pan/Gir No. Aadcm9810C (अपीलाथी/Appellant) (प्रत्यथी / Respondent) :

…x treatment to Short Term capital Gains under Section 111A, the principles/criteria culled out from judicial decisions rendered in the context of the law as it then read, have become redundant, that the decision of the Supreme court in CIT v. H. Holck Larsen (160 ITR 67) where the Supreme Court has upheld the decision of the High Court reversing the decision of the Appellate Tribunal, (even in a case where the assessee investor had borrowed money) provides a very good guide of the kind of approach which must be adopted while deciding the issue as to whether profit on the transfer of shares in a company is of capi…

Malini Agarwalla, Mumbai vs. DCIT 12(3), Mumbai

In the result, the appeal of the assessee is allowed

Bench: Shri Mahavir Singh, Jm & Shri Rajesh Kumar, Am आयकर अपीऱ सं./I.T.A. No.2161/Mum/2013 (ननधधारण वषा / Assessment Year : 2008-09) बनधम/ Mrs.Malini Agarwalla, Dcit-12(3), Aayakar Bahvan, 44-A, Mittal Tower, Vs. M K Road, Nariman Point, Mumbai-400020 Mumbai-400021 स्थधयी ऱेखध सं./ Pan :Aadpa3396G अपीऱार्थी ओर से / Appellant By Shri Pankaj Jain प्रत्यर्थी की ओर से/Respondent By Shri Suman Kumar सुनवाई की तारीख / Date Of Hearing : 23.1.2017 घोषणा की तारीख /Date Of Pronouncement :2..2.2017 आदेश / O R D E R Per Rajesh Kumar, A. M:

…in the shares in question as an investor is to be assessed under the head "Income from Business" or whether the same is to be assessed under the head "Capital Gains" as disclosed by the assessee in his return of income. In the case of CIT Vs. H. Holck Larsen, 160 ITR 67(SC) been held that the question whether the transactions of sale and purchase of shares were trading transactions or whether they were in the nature of investment is a mixed question of law and facts. In the case of P .M.Mohd. Meerakhan 73 ITR 735 (SC), it has been held that the answer whether a transaction is adventure in the nature of trade or n…

DCIT Cir 2(2)(1), Mumbai vs. State Bank of Saurashtra, Mumbai

In the result, appeal of the assessee is allowed

Bench: Shri R.C.Sharma, Am & Shri Ravish Sood, Jm Ms. Krishna Sharma Vs. Addl Cit – 19(1), Mumbai G-3, Black Diamond Chs, Khar Danda Road, Khar(W), Mumbai – 400 052 Pan/Gir No. Aaops5770R Appellant) .. Respondent)

…of assessee. Here, the Apex Court defined „business as an occupation which engaged the time, attention and labour of the person normally with object of making profit. 23. Reliance can also be placed on Supreme Court decision in CIT vs. H. Holck Larsen (1986) 160 ITR 67 (SC) wherein, it was held that activities undertaken by an investor in purchase and sale of shares to nurse his investment in shares and avoid erosion of its value of shares does not amount to trading in shares but are investment activities. 24. From the Order of CIT(A) we observe that the CIT(A) has relied on Delhi ITAT decision in Radial Interna…

Krishna Sharma, Mumbai vs. Addl CIT 19(1), Mumbai

In the result, appeal of the assessee is allowed

Bench: Shri R.C.Sharma, Am & Shri Ravish Sood, Jm Ms. Krishna Sharma Vs. Addl Cit – 19(1), Mumbai G-3, Black Diamond Chs, Khar Danda Road, Khar(W), Mumbai – 400 052 Pan/Gir No. Aaops5770R Appellant) .. Respondent)

…of assessee. Here, the Apex Court defined „business as an occupation which engaged the time, attention and labour of the person normally with object of making profit. 23. Reliance can also be placed on Supreme Court decision in CIT vs. H. Holck Larsen (1986) 160 ITR 67 (SC) wherein, it was held that activities undertaken by an investor in purchase and sale of shares to nurse his investment in shares and avoid erosion of its value of shares does not amount to trading in shares but are investment activities. 24. From the Order of CIT(A) we observe that the CIT(A) has relied on Delhi ITAT decision in Radial Interna…

R.R. Hosiery, Mumbai vs. Asst CIT 18(2), Mumbai

In the result, the appeal of the assessee is allowed

Bench: Shri Saktijit Dey, Jm & Shri Rajesh Kumar, Am आमकय अऩीर सं./I.T.A. No.5408/Mum/2013 (ननधधारण वषा / Assessment Years : 2008-09) बनधम/ M/S R R Hosiery, Asstt. Commissioner Of Income Tax, Shri Laxmi Woolen Mills Estate 18(2) Vs. Off Dr.E Mosel Road, Mumbai. Mahalaxmi, Mumbai-400011 स्थधयी ऱेखध सं./ Pan : Aaafr1054R (अऩीराथी /Appellant) (प्रत्मथी / Respondent) ..

…of consistency was required to be followed in the current year also. In defence of his arguments, the ld.AR relied on the decisions in the case of CIT V/s Associated Industrial Development Co.(P.) Ltd. [1971] 82 ITR 586 (SC) and CIT V/s H. Holck Larsen [1986] 160 ITR 67 (SC). Finally, the ld.AR placed before us a copy of circular issued by the CBDT vide Circular No.6 of 2016, dated 29.2.2016 wherein it has been provided that if the shares and securities held for a period of more than 12 months before the transfer and the assessee desires to treat the income arising from sale of transfer of said shares /securities…

Kamal Kishore Agarwal, Mumbai vs. ITO 24(2)(1), Mumbai

In the result, appeals for A

…capital gain) and the shares in that case were held for very short-period, in some cases for even a week. In that case, the assessee also earned speculation profit in addition to short-term and long-term capital gain. 8. In the case of H. Holck Larsen v/s CIT 160 ITR 67 (SC) The Hon‟ble Supreme court laid down that the frequency of transactions was not decisive. The assessee in this case was an investor in shares and not a dealer in shares. 9. Furthermore authority for advance ruling in the case of Fidelity Northsatr Fund & another 288 ITR 641 (AAR) despite number of shares transactions held that the assessee wa…

DCIT 24(2), Mumbai vs. Kamal Kioshor Agarwal, Mumbai

In the result, appeals for A

…capital gain) and the shares in that case were held for very short-period, in some cases for even a week. In that case, the assessee also earned speculation profit in addition to short-term and long-term capital gain. 8. In the case of H. Holck Larsen v/s CIT 160 ITR 67 (SC) The Hon‟ble Supreme court laid down that the frequency of transactions was not decisive. The assessee in this case was an investor in shares and not a dealer in shares. 9. Furthermore authority for advance ruling in the case of Fidelity Northsatr Fund & another 288 ITR 641 (AAR) despite number of shares transactions held that the assessee wa…

Kamal Kishor Agarwal, Mumbai vs. Addl CIT RG 24(2), Mumbai

In the result, appeals for A

…capital gain) and the shares in that case were held for very short-period, in some cases for even a week. In that case, the assessee also earned speculation profit in addition to short-term and long-term capital gain. 8. In the case of H. Holck Larsen v/s CIT 160 ITR 67 (SC) The Hon‟ble Supreme court laid down that the frequency of transactions was not decisive. The assessee in this case was an investor in shares and not a dealer in shares. 9. Furthermore authority for advance ruling in the case of Fidelity Northsatr Fund & another 288 ITR 641 (AAR) despite number of shares transactions held that the assessee wa…

ACIT Cir 6(3), Mumbai vs. Laxmi Ventures (India) Ltd, Mumbai

In the result, the appeal of the assessee is partly allowed while the Revenue’s appeal is allowed

Bench: Shri Sanjay Arora, Am & Shri Pawan Singh, Jm आयकर अपील सं./I.T.A. No. 4303/Mum/2009 ("नधा"रण वष" / Assessment Year: 2005-06) Laxmi Ventures (India) Ltd. Asst. Cit-6(3), बनाम/ 36/40, Mahalaxmi Bridge Arcade, Aaykar Bhavan, M. K. Marg, Vs. Mahalaxmi, Mumbai-400 034 Churchgate, Mumbai-400 020 "थायी लेखा सं./जीआइआर सं./Pan/Gir No. Aaacl 1082 G (Assessee) : (Revenue) आयकर अपील सं./I.T.A. No. 4243/Mum/2009 ("नधा"रण वष" / Assessment Year: 2005-06) Asst. Cit-6(3), Laxmi Ventures (India) Ltd. बनाम/ Aaykar Bhavan, M. K. Marg, 36/40, Mahalaxmi Bridge Arcade, Vs. Churchgate, Mumbai-400 020 Mahalaxmi, Mumbai-400 034 "थायी लेखा सं./जीआइआर सं./Pan/Gir No. Aaacl 1082 G (Revenue) (Assessee) : Assessee By : Shri Haridas Bhatt : Shri S. R. Singh Revenue By सुनवाई क" तार"ख / : 20.4.2016 Date Of Hearing घोषणा क" तार"ख / : 30.6.2016 Date Of Pronouncement आदेश / O R D E R Per Sanjay Arora, A. M.: These Are Cross Appeals, I.E. By The Assessee & The Revenue, Arising Out Of The Order By The Commissioner Of Income Tax(Appeals)-Vi, Mumbai (‘Cit(A)’For Short) Dated 20.5.2009, Partly Allowing The Assessee’S Appeal Contesting Its’ Assessment Under Section 143(3) Of The Income Tax Act, 1961 (‘The Act’ Hereinafter) Dated 31.12.2007 For The Assessment Year (A.Y.) 2005-06. 2

…TR 65 (SC); v. CIT vs. Associated Industrial Development Co. (P.) Ltd. [1971] 82 ITR 586 (SC); vi. G. Venkataswami Naidu & Co. vs. CIT (35 ITR 194); vii. CIT vs. Sutlej Cotton Mills Supply Agency Limited (100 ITR 706); and viii. CIT vs. H. Hoick Larsen [1986] 160 ITR 67 (SC). However, for the sake of completeness of our order, we may analyse his findings and which remains undisputed or uncontroverted even before us: (a) Firstly, in terms of Accounting Standard-17 (AS-17), requiring it to report on its different business segments, clearly states to be dealing in buying/selling of shares and securities and tradin…