ITO, New Delhi V. Sh. Ashok Kumar, New Delhi

ITA 1046/DEL/2012

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 86869 (ITAT-DELHI)
• Duration Of Justice: 3 year(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-03-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 28-01-2015
• Assessment Year: 2007-2008
• Appeal Filed On: 02-03-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: VIKRAM SAHAI
• Assessee Lawyers: ROHIT JAIN ADV SA HIL MEHTA
• Keywords: Capital asset; Business income; Rule of consistency
• Section: 143(3); 2(14); 28

Judgement Text

ITA NO. 1046 & 1314/D/2012 ASSTT.YEAR: 2007-08, 2008-09 1 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES A NEW DELHI BEFORE SHRI G.D. AGRAWAL, VICE PRESIDENT AND SHRI CHANDRAMOHAN GARG, JUDICIAL MEMBER ITA NO.1046/DEL/2012 ASSTT.YEAR: 2007-08 ITA NO.1314/DEL/2012 ASSTT.YEAR: 2008-09 INCOME TAX OFFICER, VS ASHOK KUMAR, WARD-37(1), ROOM NO.409, 99, AMBICA VIHAR, VIKAS BHAVAN, I.P.ESTATE, PASCHIM VIHAR, NEW DELHI. NEW DELHI-110087 (PAN: AAJPK2672B) (APPELLANT) (RESPONDENT) APPELLANT BY: SHRI VIKRAM SAHAI DR RESPONDENT BY: S/SHRI ROHIT JAIN, ADV. , SA HIL MEHTA DATE OF HEARING:28.1.2015 DATE OF PRONOUNCEMENT: 2.3.2015 O R D E R PER CHANDRAMOHAN GARG, J.M. THE ABOVE CAPTIONED APPEALS HAVE BEEN FILED BY THE REVENUE AGAINST THE ORDER OF THE CIT(A)-XXVIII, NEW DELHI DATED 15. 12.2011 IN APPEAL NO. 94/2009-10 AND APPEAL NO.203/2010-11 FOR AY 2008-09 . 2. THE REVENUE HAS RAISED SOLITARY SIMILAR GROUND I N BOTH THE APPEALS WHICH READS AS UNDER:- ITA NO. 1046 & 1314/D/2012 ASSTT.YEAR: 2007-08, 2008-09 2 1. WHETHER THE CIT(A) WAS JUSTIFIED IN REJECTING THE AOS CONTENTION OF TREATING THE TRADING IN SHARES A S BUSINESS INCOME INSTEAD OF CAPITAL GAINS DESPITE THE NATURE OF TRANSACTIONS MADE BY THE ASSESSEE AND THE FREQUENCY AND THE VOLUME OF TRANSACTIONS. 3. WE HAVE HEARD ARGUMENTS OF BOTH THE SIDES AND CA REFULLY PERUSED THE RELEVANT MATERIAL PLACED ON RECORD BEFORE US. APRO POS AFORESAID GROUND OF THE REVENUE, LD/ DR SUBMITTED THAT THE CIT(A) WAS N OT JUSTIFIED IN REJECTING THE ACTION OF THE AO TREATING THE INCOME FROM TRADI NG IN SHARES AS BUSINESS INCOME INSTEAD OF CAPITAL GAINS AS CLAIMED BY THE A SSESSEE. LD. DR VEHEMENTLY CONTENDED THAT THE CIT(A) IGNORED THE NA TURE OF TRANSACTIONS MADE BY THE ASSESSEE AND THE FREQUENCY AND THE VOLU ME OF THE TRANSACTIONS EFFECTED BY THE ASSSSEE DURING THE FINANCIAL YEAR U NDER CONSIDERATION. SUPPORTING THE ASSESSMENT ORDER, LD. DR SUBMITTED T HAT THE AO RIGHTLY OBSERVED THAT WHILE DETERMINING THE AMOUNT UNDER TH E HEAD OF INVESTMENT AND TRADING AND CONSEQUENTLY INCOME FROM THESE SOU RCES ARE TO BE FILED UNDER THE HEAD OF CAPITAL GAINS AND BUSINESS INCOME RESPECTIVELY, BUT ONE HAS TO LOOK INTO THE FACTS AND CIRCUMSTANCES OF THE CASE. LD. DR POINTED OUT THAT AS PER BOARD CIRCULAR NO. 4/2010 DATED 16.05.2 007 OF THE CBDT ON THIS ISSUE IS AMPLY CLEAR WHICH EXPRESSES THE DISTI NCTION BETWEEN SHARES HELD AS STOCK-IN-TRADE AND SHARES HELD AS INVESTMEN T AND ALSO MAKES DISTINCTION BETWEEN CAPITAL ASSET AND TRADING ASSET . LD. DR FURTHER SUBMITTED THAT CAPITAL ASSETS ARE DEFINED IN SECTIO N 2(14) OF THE INCOME TAX ITA NO. 1046 & 1314/D/2012 ASSTT.YEAR: 2007-08, 2008-09 3 ACT, 1961, LONG TERM CAPITAL ASSET AND GAINS ARE DE ALT U/S 2(29A) AND SECTION 2(29B) OF THE ACT AND SHORT TERM CAPITAL AS SET AND GAINS ARE DEALT WITH U/S 2(42A) AND 2(42B) OF THE ACT AND TRADING B ALANCE HAS BEEN DEFINED U/S 28 OF THE ACT. LD. DR HAS FURTHER DRAW N OUR ATTENTION TOWARDS CBDT INSTRUCTION NO. 1827 DATED 31.8.1989 AND SUBMI TTED THAT THROUGH THIS INSTRUCTION TO THE AO, A DISTINCTION BETWEEN S HARES HELD AS INVESTMENT (CAPITAL ASSET) AND SHARES HELD AS STOCK-IN-TRADE ( TRADING ASSET) HAS BEEN CARVED OUT AND IN THE LIGHT OF A NUMBER OF JUDICIAL DECISIONS PRONOUNCED ON THE ISSUE, IT WAS PROPOSED TO UPDATE THE ABOVE INST RUCTION FOR THE INFORMATION OF THE ASSESSEE AS WELL AS FOR THE GUID ANCE OF THE AO. 4. PLACING RELIANCE ON THE DECISION OF HONBLE SUPREME COURT IN THE CASE OF CIT VS ASSOCIATED INDUSTRIAL DEVELOPMENT CO MPANY (P) LTD. [1971] 82 ITR 586 (SC), LD. DR VEHEMENTLY CONTENDED THAT WHERE A PARTICULAR HOLDING OF SHARES IS BY WAY OF INVESTMEN T OR FORMS PART OF STOCK- IN-TRADE IS A MATTER WHICH IS IN THE KNOWLEDGE OF T HE ASSESSEE WHO HOLD SHARES AND IT SHOULD, IN NORMAL CIRCUMSTANCES, BE I N A POSITION TO PRODUCE EVIDENCE FROM ITS RECORD AS TO WHETHER IT HAS MAINT AINED ANY DISTINCTION BETWEEN THOSE SHARES WHICH ARE ITS STOCK-IN-TRADE A ND THOSE WHICH ARE HELD BY WAY OF INVESTMENT. LD. DR FINALLY SUBMITTED THA T THE AO WENT IN DETAIL TO DECIDE THE ISSUE OF STOCK-IN-TRADE AND INVESTMEN T FOLLOWING ALL THE PRINCIPLES AS PER CBDT CIRCULAR AND VARIOUS JUDICIA L PRONOUNCEMENTS. LD. ITA NO. 1046 & 1314/D/2012 ASSTT.YEAR: 2007-08, 2008-09 4 DR HAS FURTHER DRAWN OUR ATTENTION TOWARDS ASSESSME NT ORDER AND SUBMITTED THAT THE AO WENT IN DETAIL TO CONSIDER AL L RELEVANT POINTS WITH REGARD TO PURCHASE/SALES OF SHARES AND THE TREATMEN T GIVEN BY THE ASSESSEE IN HIS BOOKS OF ACCOUNTS, MAGNITUDE OF PURCHASE AND SALES AND FREQUENCY OF TRANSACTION AND RATIO OF SALES TO PURCHASES AS SHOW N ON ACCOUNT OF INVESTMENT, PERIOD OF HOLDING OF SHARES AND DIVIDEN D ACTUALLY EARNED ON THE SHARES BEFORE SELLING THE SAME. LD. DR DISPUTING T HE IMPUGNED ORDER SUBMITTED THAT THE CIT(A) WAS NOT JUSTIFIED IN CONC LUDING THAT MERELY SELLING SHARES AT PROFIT OR BUYING SHARES WITH PROF IT MOTIVE WOULD NOT AMOUNT TO BUSINESS ACTIVITY. LD. DR VEHEMENTLY CON TENDED THAT LOOKING INTO THE FREQUENCY OF TRANSACTION AND PERIOD OF HOL DING, THE MAIN OBJECT OF THE ASSESSEE WAS TO EARN PROFIT FROM SALE AND PURCH ASE OF SHARES WHICH IS CLEARLY BUSINESS ACTIVITY AND INCOME THEREFROM CANN OT BE HELD AS CAPITAL GAIN. LD. DR FINALLY SUBMITTED THAT THE IMPUGNED O RDER MAY BE SET ASIDE BY RESTORING THAT OF THE AO IN BOTH THE ASSESSMENT YEA RS. 5. REPLYING TO THE ABOVE, LD. COUNSEL OF THE ASSESS EE SUBMITTED THAT FOLLOWING FACTS WOULD AMPLY DEMONSTRATE THAT THE SH ARES HELD BY THE ASSESSEE WERE IN THE NATURE OF INVESTMENT AND NOT S TOCK-IN-TRADE, THEREFORE, INCOME ARISING ON TRANSFER OF SHARES/SALE OF SHARES WERE RIGHTLY OFFERED FOR TAXATION BY THE ASSESSEE UNDER THE HEAD OF CAPITAL GAINS. DURING THE ARGUMENT, LD. COUNSEL OF THE ASSESSEE SUBMITTED WRI TTEN ITA NO. 1046 & 1314/D/2012 ASSTT.YEAR: 2007-08, 2008-09 5 SYNOPSIS/SUBMISSIONS TO SUPPORT THE STAND OF THE AS SESSEE WHICH READS AS UNDER:- ASSESSEE IS A CHARTERED ACCOUNTANT BY PROFESSION A ND IS PARTNER IN M/S. SUNIL GUPTA AND CO, CHARTERED AC COUNTANTS ; - SHARES WERE HELD AND CLASSIFIED AS 'INVESTMENTS' AND NOT AS 'STOCK IN TRADE' IN THE BOOKS OF ACCOUNT [REFER BAL ANCE SHEET FOR THE YEAR ENDED 31.03.2005, 31.03.2006, 31.03.20 07 & L31.03.2008 - PAGES 13-15 OF THE PAPER BOOK); - SHARES HELD AS INVESTMENTS ARE CONSISTENTLY VALUE D AT COSTAND NOT AT COST OR MARKET PRICE, WHICHEVER IS LOWER; -. ASSESSEE HAD NO INFRASTRUCTURE/ STAFF/EMPLOYEE T O UNDERTAKE BUSINESS ACTIVITY OF TRADING IN SHARES. INVESTMENT TRANSACTIONS WERE UNDERTAKEN BY GIVING INSTRUCTIONS ON PHONE TO THE BROKER; - ENTIRE INVESTMENT WAS MADE OUT OF OWN FUNDS AND N OT OUT OF BORROWED FUNDS [REFER BALANCE SHEET AT PAGE 13 OF P APER BOOK]; - SHORT-TERM CAPITAL GAIN OF RS.1.43 CRORES WAS EA RNED FROM 39 SCRIPS ONLY [REFER PAGES 3-6 OF PAPER BOOK]; - TRANSACTIONS DECLARED AS 'CAPITAL GAINS' WERE DEL IVERY BASED, I.E., WHERE DELIVERY WAS TAKEN AFTER MAKING FULL PAYMENT FOR SUCH INVESTMENT; - OUT OF THE TOTAL CAPITAL GAIN OF RS.L,43,75,949/- , 85.30% GAIN WAS OUT OF FOUR SCRIPS (A) GREMACH OF AMOUNT 40,31,914/- AND (B) ALUWALIA CO. OF AMOUNT 61,90,598/- (C) IB REALTY OF AMOUNT RS.I0,15 ,2711- (D) GREAVES CRO.RS.10,24,3811- (REFER PGS 3-5 OF THE PB ) - MAJOR PART OF THE CAPITAL GAIN WAS EARNED IN RESP ECT OF SHARES HELD FOR MORE THAN 30 DAYS AS IS EVIDENT FRO M THE FOLLOWING CHART (REFER PG. 3-12 OF THE PB): ITA NO. 1046 & 1314/D/2012 ASSTT.YEAR: 2007-08, 2008-09 6 CAPITAL GAIN % OF TOTAL GAIN PERIOD OF HOLDING 1,306,190 16.18% 10 DAYS OR LESS 789,354 9.,78% 11 DAYS TO 30 DAYS 5,978,334 74.05% MORE THAN 30 DAYS 8,073,878 - OUT OF 365 DAYS IN AN YEAR, SHARE TRANSACTIONS WER E UNDERTAKEN IN 99 DAYS ONLY (REFER PG 10-15 0F PB); - SIMILAR CLASSIFICATION OF SHARES AS 'INVESTMENT' A ND CAPITAL GAINS ACCEPTED BY THE DEPARTMENT IN THE PRECEDING A SSESSMENT YEARS 2004-05, 2005-06 AND 2006-07 UNDER SECTION 14 3(1) OF THE INCOME TAX ACT, 1961 ('THE ACT'); - OUT OF TOTAL GAIN OF RS.1.43 CRORES, CAPITAL GAIN ON SHARES HELD IN THE PRECEDING YEAR AMOUNTED TO RS.33,46,480 /- (REFER PG 9 OF PB); - CLASSIFICATION OF SHARES AND GAINS ALSO ACCEPTED B Y THE ASSESSING OFFICER IN THE SUCCEEDING ASSESSMENT YEAR 2009-10 VIDE ORDER DATED 25.11.2011 PASSED UNDER SECTION 14 3(3) OF THE ACT [REFER PAGES 37-39 OF THE PAPER BOOK). 6. LD. COUNSEL LASTLY SUBMITTED THAT AFOREMENTIONE D FACTS CLEARLY ESTABLISH BEYOND ANY DOUBT THAT THE INVESTMENT MADE BY THE ASSESSEE IN SHARES/SECURITIES WERE PART OF THE INVESTMENT ON CA PITAL ACCOUNT AND THE SAME WAS NOT STOCK-IN-TRADE AND, THEREFORE, THE AO WAS NOT JUSTIFIED IN HOLDING THAT THE INCOME ARISING FROM TRANSFER OF SU CH SHARES WAS BUSINESS INCOME AND THE CIT(A) WAS RIGHT IN CONCLUDING THAT THE INCOME AROSE FROM TRANSFER OF SHARES WHICH WAS KEPT AS INVESTMENT WAS CLEARLY IN THE NATURE OF CAPITAL GAINS AS DECLARED BY THE ASSESSEE. ITA NO. 1046 & 1314/D/2012 ASSTT.YEAR: 2007-08, 2008-09 7 7. ON CAREFUL CONSIDERATION OF ABOVE SUBMISSIONS, W E NOTE THAT THE CIT(A) GRANTED RELIEF FOR THE ASSESSEE WITH FOLLOWI NG CONCLUSION:- 47. I HAVE ALSO SEEN THE CHART FILED BY THE APP ELLANT TO SHOW THAT TOTAL PURCHASE AND SALE CARRIED OUT BY TH E APPELLANT IN THE WHOLE YEAR COMES TO ONLY 66 DAYS. TOTAL TRANSACTIONS DONE BY HIM IN 66 DAYS COMES TO 101 AV ERAGING LESS THAN 2 TRANSACTIONS PER DAY WITH REFERENCE TO 66 DAYS ON WHICH TRANSACTIONS WERE DONE AND ONLY 0.27 TRANSACT IONS PER DAY WITH REFERENCE TO THE WHOLE YEAR. PURCHASE AND SALE OF SHARES ARE DONE JUST BY MAKING TELEPHONE CALLS TO T HE BROKER. MAKING PHONE CALLS TAKES HARDLY A FEW MINUTES. TOTA L TIME DEVOTED BY THE APPELLANT FOR THE TRANSACTION OF PUR CHASE AND SALE OF SHARES DOES NOT TAKE EVEN FEW MINUTES. THUS I AGREE WITH THE APPELLANT THAT SALE AND PURCHASE OF SHARE WAS NOT THE REGULAR BUSINESS ACTIVITY OF THE APPELLANT AND HENCE I HOLD THAT THE PROFIT DERIVED BY HIM FROM THE SAME C ANNOT BE TREATED TO BE A BUSINESS PROFIT. ASSESSING OFFICER IS THEREFORE DIRECTED NOT TO TREAT THE PROFIT FROM SALE OF SHARE S DECLARED BY THE APPELLANT AS BUSINESS PROFIT. AUTHORIZED REPRESENTATIVE OF THE APPELLANT HAS FAIRLY CONCEDED THAT ONCE PROFIT FROM SALE OF THESE SHARES IS HELD AS CA PITAL GAIN, DEDUCTION OF STT PAID AT RS. 83,377/- WILL NOT BE A LLOWABLE. IN THAT EVENT PROFIT OF RS. 79,80,789 WILL BECOME T AXABLE AS SHORT TERM CAPITAL GAIN @10% AND PROFIT OF RS. 93,0 89/- WILL BE FULLY EXEMPT AS LONG TERM CAPITAL GAIN. ASS ESSING OFFICER IS ACCORDINGLY DIRECTED TO TAX PROFIT OF RS .79,80,789 FROM SALE OF SHARES AS SHORT TERM CAPITAL GAIN @10% U/S 111A AND GRANT FULL EXEMPTION TO THE PROFIT OF RS. 93,089/- AS LONG TERM CAPITAL GAIN. THIS GROUND IS THEREFORE AL LOWED. 8. IN VIEW OF ABOVE, WE ARE OF THE CONSIDERED OPINI ON THAT THE AO HAS NOT BROUGHT OUT ANYTHING TO CONTROVERT THIS FACT TH AT THE SALE AND PURCHASE OF SHARES BY THE ASSESSEE WAS NOT A REGULAR BUSINES S ACTIVITY AND THEREFORE PROFIT DERIVED BY THE ASSESSEE FROM THE SAME CANNOT BE TREATED TO BE ITA NO. 1046 & 1314/D/2012 ASSTT.YEAR: 2007-08, 2008-09 8 BUSINESS INCOME FROM PROFIT. FROM PAPER BOOK PAGE NO. 13 TO 15, WE NOTE THAT THE ASSESSEE HAS SHOWN INVESTMENT IN SHARES AS IN AY 2005-06, 2006- 07 AND 2007-08 AND THE SAME HAS BEEN SHOWN AT COST AND NOT AS STOCK-IN- TRADE WHICH IS VALUED AT COST OR MARKET PRICE WHICH EVER IS LOWER. FROM BALANCE SHEET PAGE NO. 13, WE ALSO NOTE THAT IN AY 2007-08, THE CAPITAL BROUGHT FORWARD BY THE ASSESSEE WAS RS.1,19,66,247 WHEREAS INVESTMENT IN SHARES WAS OF RS.59,94,734. AT THE SAME TIME FR OM PAPER BOOK PAGE NO. 3 TO 6, WE ALSO OBSERVE THAT SHORT TERM CAPITAL GAI N OF RS. 79 LAKH WAS EARNED FROM 25 SCRIPS ONLY AND THE PROFIT DECLARED AS CAPITAL GAIN WAS EARNED FROM DELIVERY BASED PURCHASE AND SALE OF SHA RES AND DELIVERY WAS TAKEN AFTER MAKING FULL PAYMENT FOR SUCH TRANSACTIO N. WE ALSO NOTE THAT AS PER PAPER BOOK PAGE NO. 3 AND 5 OF THE ASSESSEE, SH ORT TERM CAPITAL GAIN WAS EARNED OUT OF 3 SCRIPS WHICH ONLY COMES TO 93.6 2% OF THE TOTAL PROFIT FROM PURCHASE AND SALE OF SHARES AND MAJOR PART OF THE CAPITAL GAIN WAS EARNED FROM THE SHARES HELD BY THE ASSESSEE FOR MOR E THAN 30 DAYS. THE AO HAS NOT BROUGHT OUT ANY FACT OR MATERIAL TO CONTROV ERT OR TO DEMOLISH ABOVE FACTS SUPPORTING THE CASE OF THE ASSESSEE. 9. LD. COUNSEL HAS ALSO RAISED ISSUE OF CONSISTENC Y AND SUBMITTED THAT SIMILAR CLASSIFICATION OF SHARES AS INVESTMENT AND CAPITAL GAINS WAS ACCEPTED BY THE DEPARTMENT IN THE PRECEDING ASSESSM ENT YEARS 2004-05, 2005-06 AND 2006-07 U/S 143(1) OF THE ACT. LD. COU NSEL ALSO SUBMITTED ITA NO. 1046 & 1314/D/2012 ASSTT.YEAR: 2007-08, 2008-09 9 THAT CLASSIFICATION OF SHARES AND GAINS WAS ALSO AC CEPTED BY THE AO IN THE SUCCEEDING ASSESSMENT YEAR 2009-10 VIDE ORDER DATED 25.11.2011 PASSED U/S 143(3) OF THE ACT (PB PAGE 89-90). 10. LD. DR REPLIED THAT THE PRINCIPLE OF RES JUDICA TA DOES NOT APPLY TO THE TAXATION MATTER AND HENCE IF CLAIM OF THE ASSESSEE WAS ALLOWED IN THE PRECEDING YEARS IN THE ASSESSMENT FINALISED U/S 143 (1) OF THE ACT, THEN DEPARTMENT IS NOT PREVENTED TO VERIFY AND EXAMINE T HE ISSUE IN THE SUCCEEDING YEARS I.E. 2007-08 AND 2008-09. HOWEVER , LD. DR FAIRLY ACCEPTED THAT SIMILAR CLASSIFICATION OF SHARES AND TREATMENT OF PROFIT SUBMITTED BY THE ASSESSEE WAS ACCEPTED BY THE AO IN THE SUCCEEDI NG AY I.E. 2009-10 VIDE ORDER DATED 25.11.2011 (SUPRA) PASSED U/S 143(3) OF THE AC T. 11. AT THE OUTSET, WE ARE IN AGREEMENT WITH THIS LE GAL CONTENTION OF THE LD. DR THAT PRINCIPLE OF RES JUDICATA DOES NOT APPLY TO THE TAXATION PROCEEDINGS BUT AT THE SAME TIME, WE CANNOT IGNORE THIS LEGAL P ROPOSITION THAT THE RULE OF CONSISTENCY HAS TO BE FOLLOWED IN GOOD CONSCIENC E AND BONA FIDE UNTIL AND UNLESS CHANGED FACTS AND CIRCUMSTANCES ARE FOUN D IN THE SUBSEQUENT ASSESSMENT YEAS. AS WE HAVE NOTED EARLIER THAT THE ASSESSEE HAS SHOWN SHARES IN ITS BALANCE SHEET DURING THE PRECEDING AS SESSMENT YEARS AS AN INVESTMENT AND THE SAME HAS BEEN VALUED AT COST OF PURCHASE. AT THE COST OF REPETITION, WE ALSO TAKE NOTE OF THIS FACT THAT OUT OF TOTAL CAPITAL GOODS, THE ASSESSEE EARNED 93.62% FROM THE TRANSACTIONS IN THR EE SCRIPS OF LOK ITA NO. 1046 & 1314/D/2012 ASSTT.YEAR: 2007-08, 2008-09 10 HOUSING, KARUTARI, AND OKPLAY. IN THIS SITUATION, SIMILAR CLASSIFICATION OF INCOME HAS BEEN ACCEPTED BY THE DEPARTMENT IN THE P RECEDING THREE CONSECUTIVE ASSESSMENT YEARS U/S 143(1) OF THE ACT AND ALSO SAME CLASSIFICATION OF SHARES AND PROFIT FROM PURCHASE A ND SALE OF SHARES HAS BEEN ACCEPTED BY THE AO IN AY 2009-10 AS CAPITAL GA INS IN ORDER DATED 25.11.2012 PASSED U/S 143(3) OF THE ACT, THEN FOR T HE ASSESSMENT YEARS UNDER CONSIDERATION, THE REVENUE CANNOT TREAT THE S AME INCOME AS BUSINESS INCOME IN ABSENCE OF ANY SUBSTANTIALLY CHANGED FACT S AND CIRCUMSTANCES. THEREFORE, WE ARE INCLINED TO HOLD THAT THE AO WAS NOT JUSTIFIED IN TREATING THE INCOME FROM PURCHASE AND SALE OF SHARES AS BUSI NESS INCOME IGNORING THE TREATMENT GIVEN BY THE ASSESSEE IN HIS BOOKS OF ACCOUNTS AND FINANCIAL STATEMENT FILED ALONG WITH THE RETURN OF INCOME AND IN THE LIGHT OF ABOVE NOTED FACTS, THE CIT(A) WAS RIGHT IN FOLLOWING THE PRINCIPLE OF CONSISTENCY AND REACH TO A LOGICAL CONCLUSION THAT THE INCOME ACCRUED TO THE ASSESSEE FROM PURCHASE AND SALE OF SHARES WAS CAPITAL GAINS. WE ARE UNABLE TO SEE ANY AMBIGUITY, PERVERSITY OR ANY OTHER VALID REASON TO INTERFERE WITH THE IMPUGNED ORDER AND WE UPHOLD THE SAME. ACCORDINGLY , SOLE GROUND IN BOTH THE APPEALS OF THE REVENUE BEING DEVOID OF MERITS I S DISMISSED. 12. IN THE RESULT, THE APPEALS OF THE REVENUE ARE D ISMISSED. ITA NO. 1046 & 1314/D/2012 ASSTT.YEAR: 2007-08, 2008-09 11 ORDER PRONOUNCED IN THE OPEN COURT ON 02.03.2015. SD/- SD/- (G.D. AGRAWAL) (CHANDRAMO HAN GARG) VICE PRESIDENT JU DICIAL MEMBER DT. 2 ND MARCH, 2015 GS COPY FORWARDED TO:- 1. APPELLANT 2. RESPONDENT 3. C.I.T.(A) 4. C.I.T. 5. DR BY ORDER ASSTT. REGISTRAR