KHIRMIN D. BHARUCHA, MUMBAI V. DCIT (OSD)-12, MUMBAI

ITA 3757/MUM/2012

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 1516 (ITAT-MUMBAI)
• Duration Of Justice: 4 year(s) 6 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-12-2016
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Next Hearing Date: 15-09-2015
• Assessment Year: 2008-2009
• Appeal Filed On: 28-05-2012
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: A RAMACHANDRAN
• Assessee Lawyers: VISPI T PATEL
• Keywords: Business income
• Section: 143(3)

Judgement Text

A IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, MUMBAI BEFORE SHRI MAHAVIR SINGH, JUDICIAL MEMBER AND SHRI RAMIT KOCHAR, ACCOUNTANT MEMBER ./ I.T.A. NO. 3757 /MUM/2012 ( / ASSESSMENT YEAR : 2008-09) MRS. KHIRMIN D. BHARUCHA, 4, 1ST FLOOR, JEHANGIR MANSION, IST MARINE STREET, FORT, MUMBAI -400036. / V. DY. COMMISSIONER OF INCOME TAX (OSD)-12, MUMBAI. ./ PAN : AAEPB 8187B ( / APPELLANT ) .. ( / RESPONDENT ) ASSESSEE BY SHRI VISPI T. PATEL REVENUE BY : SHRI A. RAMACHANDRAN / DATE OF HEARING : 19-10-2016 / DATE OF PRONOUNCEMENT : 07-12-2016 / O R D E R PER RAMIT KOCHAR, ACCOUNTANT MEMBER THIS APPEAL, FILED BY THE ASSESSEE, BEING ITA NO. 3757/MUM/2012, IS DIRECTED AGAINST THE APPELLATE ORDER DATED 5 TH MARCH, 2012 PASSED BY THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS)- 23, M UMBAI (HEREINAFTER CALLED THE CIT(A)), FOR THE ASSESSMENT YEAR 2008- 09, THE APPELLATE PROCEEDINGS BEFORE THE LEARNED CIT(A) ARISING FROM THE ASSESSMENT ORDER 16 TH DECEMBER, 2010 PASSED BY THE LEARNED ASSESSING OFFI CER (HEREINAFTER CALLED THE AO) U/S 143(3) OF THE INCOME-TAX ACT,1961 (HE REINAFTER CALLED THE ACT). ITA 3757/MUM/2012 2 2. THE GROUNDS OF APPEAL RAISED BY THE ASSESSEE IN THE MEMO OF APPEAL FILED WITH THE INCOME-TAX APPELLATE TRIBUNAL, MUMBA I (HEREINAFTER CALLED THE TRIBUNAL) READ AS UNDER:- THE APPELLANT OBJECTS TO THE ORDER PASSED BY THE LEARN ED COMMISSIONER OF INCOME TAX (APPEALS) - 23, MUMBAI [ CIT (A)] DATED 05 MARCH 2012 ON THE FOLLOWING AMONGST OTHER GROUNDS: 1. THE LEARNED CIT(A) ERRED IN CONFIRMING THE ASSESS ING OFFICER'S (AO'S) ACTION OF TREATING THE SHORT-TERM CAPITAL GAINS OF INR 2,47,33,233 AS BUSINESS INCOME. 2. THE LEARNED CIT(A) ERRED IN OBSERVING THAT PURCHA SES HAVE BEEN MADE WITH THE CLEAR INTENTION OF RESALE TO EARN PROFI TS. 3. THE LEARNED CIT(A) ERRED IN HOLDING THAT THE APPEL LANT HAS INDULGED IN BUSINESS ACTIVITY IN VIEW OF THE MAGNITUD E AND FREQUENCY OF TRANSACTIONS AND LOW PERIOD OF HOLDING. 4. WITHOUT PREJUDICE TO THE ABOVE, THE LEARNED CIT(A) ER RED IN NOT DIRECTING THE AO TO ALLOW EXPENDITURE WHICH WAS INCU RRED WHOLLY AND EXCLUSIVELY FOR CARRYING OUT THE BUSINESS OF TRADING IN SHARES (IN RELATION TO RE-CHARACTERISATION OF SHORT-TERM CAPITAL GAINS AS BUSINESS INCOME). 3. THE BRIEF FACTS OF THE CASE ARE THAT THE A.O. OB SERVED THAT DURING THE YEAR THE ASSESSEE HAS MADE INVESTMENTS IN SHARES AN D MUTUAL FUNDS. THE ASSESSEE HAS ALSO DECLARED INCOME FROM SHORT TERM C APITAL GAIN AS WELL EXEMPTED LONG TERM CAPITAL GAIN FROM SHARES AND MUT UAL FUND , APART FROM DIVIDEND FROM MUTUAL FUNDS AND SHARES. DURING THE COURSE OF ASSESSMENT PROCEEDINGS U/S/ 143(3) R.W.S. 143(2) OF THE ACT, I T WAS OBSERVED BY THE A.O. THAT THE ASSESSEE HAS SHOWN AN AMOUNT OF RS. 2,47,3 3,233/- AS SHORT TERM CAPITAL GAINS. THE A.O. ACCORDINGLY ASKED THE ASSES SEE TO FURNISH DETAILS OF SUCH SHORT TERM CAPITAL GAINS , AND FROM THE DETAIL S OF THESE CAPITAL GAINS SUBMITTED BY THE ASSESSEE IT WAS NOTICED BY THE AO THAT DURING THE RELEVANT ASSESSMENT YEAR THE ASSESSEE CARRIED OUT HUGE VOLU MES OF TRANSACTIONS FOR ITA 3757/MUM/2012 3 BUYING AND SELLING OF SHARES AND SECURITIES WITH HI GH FREQUENCY. IT WAS OBSERVED BY THE AO THAT THE ASSESSEE HAS DEALT IN 3 41 TRANSACTIONS OF SALE OF SHARES OF NUMEROUS COMPANIES INCLUDING PURCHASES AN D SALES. DURING THE RELEVANT ASSESSMENT YEAR , THE ASSESSEE HAS PURCHAS ED SHARES OF RS. 32,67,31,843/- AND TOTAL SALES AMOUNTED TO RS.35,14 ,65,076/-. THE ASSESSEE WAS ASKED AS TO WHY THE SHORT TERM CAPITAL GAIN SHO WN SHOULD NOT BE TREATED AS BUSINESS INCOME. IN REPLY, THE ASSESSEE SUBMITT ED BEFORE THE AO THAT THE ASSESSEE IS ASSESSED TO TAX FOR THE LAST MORE THAN 20 YEARS AND THE SOURCE OF INCOME IS SHARE OF PROFIT AND SALARY RECEIVABLE FRO M TWO FIRMS IN WHICH THE ASSESSEE IS A PARTNER. BESIDES THIS THE ASSESSEE SU BMITTED THAT SHE HAS INCOME FROM DIVIDENDS, CAPITAL GAINS AND INTEREST F ROM BANK AND DEBENTURES. IT WAS SUBMITTED THAT AS ON 31 ST MARCH, 2007 , THE ASSESSEES CAPITAL WAS RS.15.84 CRORES WHEREAS IT INCREASED TO RS.26.06 CR ORES AT THE END OF THE FINANCIAL YEAR 2007-08. IT WAS SUBMITTED THAT THE A SSESSEE HAS NOT TAKEN ANY LOANS EXCEPT A CAR LOAN OF RS.5.34 LAKHS AS ON 31 ST MARCH, 2008. IT WAS SUBMITTED THAT THE ASSESSEE HAS INVESTED IDLE CAPIT AL IN SHARES AND SECURITIES AS REFLECTED IN BALANCE SHEET. THE ASSESSEE INVEST ED IN THE SHARES AMOUNTING TO RS. 24.82 CRORES AS ON 31 ST MARCH, 2008 AS AGAINST RS.14.92 CRORES AS ON 31 ST MARCH, 2007. THE ASSESSEE SUBMITTED THAT THE SHAR ES WERE PURCHASED IN ORDER TO GAIN MORE INCOME BY WAY OF DIVIDENDS AND A PPRECIATION IN THE VALUE OF SHARES , AND TO SELL SHARES AS AND WHEN THERE WA S SUBSTANTIAL APPRECIATION IN THE VALUE OF SHARES. THE ASSESSEE USED TO SELL S HARES AND TO BOOK PROFIT AND SIMILARLY USED TO PURCHASE SHARES WHEN MARKET CONDI TIONS WERE FAVOURABLE BY REINVESTING THE SALE PROCEEDS. IT WAS SUBMITTED THA T THE ASSESSEE HAS NOT BORROWED ANY FUNDS FOR MAKING INVESTMENTS IN SHARES AND ALL THE INVESTMENTS IN SHARES WERE HER OWN CAPITAL. THE ASSESSEE HAS TA KEN DELIVERY OF THE SHARES PURCHASED AND SIMILARLY SHE HAS GIVEN DELIVERY IN R ESPECT OF SHARES SOLD AND THE PROFIT/LOSS RESULTING FROM SUCH TRANSACTIONS IN SHARES WERE DECLARED SHORT TERM CAPITAL GAINS OR LONG TERM CAPITAL GAINS DEPEN DING UPON THE PERIOD OF HOLDING OF THE SHARES. IT WAS SUBMITTED THAT THE AS SESSEE HAS NOT ENTERED INTO ITA 3757/MUM/2012 4 ANY DAY TO DAY TRADING OR SETTLEMENT OF ANY TRANSAC TIONS WITHOUT DELIVERY OF SHARES OR ANY FUTURES OR OPTIONS TRANSACTIONS IN SH ARES AND THE ASSESSEE HAS NOT CLAIMED ANY EXPENSES SUCH AS S.T.T., INTEREST, ETC. OR PORTFOLIO MANAGEMENT FEES FROM THE PROFIT MADE ON SALE OF SHA RES. IT WAS SUBMITTED THAT THE ASSESSEE HAS SHOWN SUBSTANTIAL PROFIT AS C APITAL GAINS IN EARLIER YEARS AND THE SAME WERE ACCEPTED BY THE REVENUE. IT WAS SUBMITTED THAT THE ASSESSMENTS FOR ASSESSMENT YEARS 2004-05 AND 2007- 08 WERE COMPLETED U/S 143(3) OF THE ACT WHEREIN THE A.O. TAXED THE SAID P ROFIT AS CAPITAL GAINS AS DECLARED BY THE ASSESSEE IN HER RETURN OF INCOME FI LED WITH REVENUE. IT WAS SUBMITTED THAT REGULAR BOOKS OF ACCOUNT WERE MAINTA INED BY THE ASSESSEE AND ALL THE SHARES PURCHASED WERE SHOWN AS INVESTMENTS IN THE BOOKS OF ACCOUNT AND THE ASSESSEE HAS NOT SHOWN ANY SHARES AS STOCK IN TRADE IN HER BALANCE SHEET NOR HAD SHE SHOWN ANY PROFIT ON SALE OF SHARE S, AND HENCE IT WAS SUBMITTED THAT THE ASSESSEE IS AN INVESTOR IN SHARE S AND NOT A TRADER IN SHARES. THE A.O. REJECTED THE CONTENTIONS OF THE ASSESSEE A ND OBSERVED THAT THE ASSESSEE IS ENGAGED IN THE ACTIVITY OF DEALING IN S HARE TRANSACTIONS. THE INTENTION OF THE ASSESSEE IS TO EARN PROFIT. THE M OTIVE OF THE INVESTOR WAS TO EARN RETURNS ON THESE INVESTMENTS BY MEANS OF DIVID END AND EARN CAPITAL APPRECIATION IN THE LONG RUN AND THE ONLY INTENTION WOULD BE TO EARN PROFIT BY TAKING ADVANTAGE OF STOCK MARKET FLUCTUATIONS. THE A.O. OBSERVED THAT ASSESSEE IS NOT A SMALL SCALE RETAIL INVESTOR AND D ETAILS SUBMITTED SHOWS THAT IT HAS DEALT WITH ABOUT 341 TRANSACTIONS IN SALES O F SHARES ONLY. MAJORITY OF SHARES TRANSACTIONS WHEREIN THE ASSESSEE HAS ENTERE D PURCHASE AND SALE OF SHARES IN THE ASSESSMENT YEAR 2008-09 ITSELF. DURIN G THE RELEVANT ASSESSMENT YEAR , THE ASSESSEE HAS CARRIED OUT HUGE VOLUMES OF TRANSACTIONS FOR BUYING AND SELLING OF SECURITIES. IT WAS OBSERVED BY THE A O THAT DURING THE RELEVANT ASSESSMENT YEAR THE ASSESSEE HAS PURCHASED AND SOLD MORE THAN 5,12,399 NUMBER OF SHARES AND EARNED SHORT TERM CAPITAL GAIN /LOSS, HENCE, THE ITA 3757/MUM/2012 5 ASSESSEE WAS NOT AN INVESTOR BUT WAS A DEALER IN SH ARES. THUS, THE ASSESSEE IS ENGAGED IN THE ACTIVITIES OF TRADING IN SHARES A ND EARNED HUGE PROFIT WHICH HAS BEEN OFFERED UNDER THE HEAD CAPITAL GAINS IN OR DER TO LOWER ITS TAX LIABILITY HENCE, KEEPING IN VIEW THE FACTS AND CIRCUMSTANCES OF THE CASE, THE A.O HELD THAT THE ASSESSEE'S INCOME ARISING FROM SHARE TRANS ACTIONS IS BUSINESS INCOME. IN SUPPORT , THE A.O. RELIED ON THE CBDT C IRCULAR NO. 4 OF 2007 DATED 15 TH JUNE, 2007. THE MOTIVE OF THE ASSESSEE IS TO EARN PROFIT FROM THE SALE OF SHARES AND IN MANY SCRIPS MULTIPLE PURCHASE S AND SALES OF SHARES OF THE SAME SCRIP WAS UNDERTAKEN BY THE ASSESSEE SHOWI NG HIGH FREQUENCY OF DEALINGS. THE AO RELIED UPON DECISION OF HONBLE SU PREME COURT IN THE CASE OF G. VENKATASWAMI NAIDU & CO. V. CIT (1959) 35 ITR 59 4(SC) WHEREIN THE HONBLE APEX COURT HAS HELD THAT WHERE PURCHASE HAS BEEN MADE SOLELY AND EXCLUSIVELY WITH INTENTION TO RESELL AT PROFIT AND THE PURCHASER HAS NO INTENTION OF HOLDING PROPERTY OR ENJOYING OR USING IT, PRESENCE OF SUCH AN INTENTION IS A RELEVANT FACTOR AND UNLESS IT IS OFF SET BY PRESENCE OF OTHER FACTORS, WOULD RAISE A STRONG PRESUMPTION THAT TRAN SACTION IS IN THE NATURE OF TRADE. THE VOLUME OF FREQUENCY IN THE CASE OF THE A SSESSEE WHILE DEALING IN SHARES IS HUGE. THE SHORT TERM GAIN OF RS. 2,47,33 ,233/- HAS BEEN DERIVED FROM ABOUT 341 TRANSACTIONS AND FOR THIS THE ASSESS EE HAD SOLD SHARES TO THE TUNE OF RS. 35,14,65,076/- AND THE COST OF THEIR PU RCHASE WAS RS. 32,67,31,843/- , WHEREBY THE PERIOD OF HOLDING WAS 1 TO 30 DAYS WHEREIN NUMBER OF TRANSACTIONS WERE 75 , WHILE WHEREIN PER IOD OF HOLDING WAS FROM 31 TO 100 DAYS THE NUMBER OF TRANSACTIONS WERE 126 , WHICH SHOWED THAT THE MAXIMUM NUMBER OF SHARES WERE SOLD WITHIN 3 TO 4 MO NTHS WHICH CLEARLY SHOWS THAT SHARES WERE PURCHASED TO EARN PROFIT AND NOT DIVIDEND. IT WAS ALSO OBSERVED BY THE AO THAT THE SHARES OF THE SAME COMP ANY WERE PURCHASED AND SOLD REPEATEDLY BY THE ASSESSEE . IT WAS FURTHER O BSERVED THAT THE PRINCIPLE OF RES-JUDICATA IS NOT APPLICABLE IN THE INCOME-TAX PR OCEEDINGS , RELYING ON DECISION OF NEW JEHANGIR VAKIL MILLS LIMITED V. CIT (1963) 49 ITR 137(SC). THE AO , THEREFORE, HELD THAT THE ASSESSEE IS A TRA DER IN SHARES AND THE GAINS ITA 3757/MUM/2012 6 EARNED ON SHARES TRANSACTION AMOUNTING TO RS. 2,47, 33,233/- ARE TO BE BROUGHT TO TAX AS BUSINESS INCOME AND NOT AS CAPITA L GAINS, VIDE ASSESSMENT ORDERS DATED 16.12.2010 PASSED BY THE AO U/S 143(3) OF THE ACT. 4. AGGRIEVED BY THE ASSESSMENT ORDER DATED 16.12.20 10 PASSED BY THE A.O. U/S. 143(3) OF THE ACT, THE ASSESSEE FILED FIRST AP PEAL BEFORE THE LD. CIT(A). 5. BEFORE THE LD. CIT(A) , THE ASSESSEE REITERATED THE SUBMISSIONS AS WERE MADE BEFORE THE AO DURING THE COURSE OF ASSESSMENT PROCEEDINGS. THE LD. CIT(A) AFTER CONSIDERING THE SUBMISSIONS OF THE ASS ESSEE AND RELYING UPON VARIOUS CASE LAWS HELD THAT THE MAGNITUDE AND FREQU ENCY OF TRANSACTIONS, THE LOW PERIOD OF HOLDING AND REPETITIVE TRANSACTIONS I N THE SAME SCRIP CLEARLY SHOWS THAT THE ASSESSEE HAS INDULGED IN BUSINESS AC TIVITY AND THE A.O. IS QUITE RIGHT IN TREATING THE PROFITS ON SALE OF SHAR ES/SECURITIES UNDER THE HEAD PROFITS AND GAINS FROM BUSINESS OR PROFESSION AND ACCORDINGLY LEARNED CIT(A) UPHELD THE ASSESSMENT ORDER OF THE A.O., VIDE APPEL LATE ORDERS DATED 05-03- 2012 PASSED BY THE LEARNED CIT(A). 6. AGGRIEVED BY THE ORDER OF THE LD. CIT(A), THE AS SESSEE IS IN APPEAL BEFORE THE TRIBUNAL. 7. BEFORE THE TRIBUNAL, THE LD. COUNSEL FOR THE ASS ESSEE SUBMITTED THAT THE ASSESSEE IS A SENIOR CITIZEN AND HAS BEEN ASSESSED TO TAX FOR THE LAST MORE THAN TWO DECADES. THE LD. COUNSEL RELIED UPON THE DECISION OF THE HONBLE BOMBAY HIGH COURT IN THE CASE OF CIT V. GOPAL PUROH IT (2010) 336 ITR 287(BOM.) TO CONTEND THAT GAINS ARISING FROM SALE O F SHARES AND MUTUAL FUND IS CHARGEABLE TO TAX AS CAPITAL GAINS. IT WAS SUBM ITTED THAT THE SHORT TERM CAPITAL GAIN EARNED BY THE ASSESSEE ON SALE OF SHAR ES IS TREATED AS BUSINESS INCOME BY THE AUTHORITIES BELOW. IT WAS SUBMITTED THAT THE ASSESSEE HAS BEEN ASSESSED TO TAX U/S 143(3) OF THE ACT FOR ASSE SSMENT YEARS 2003-04, ITA 3757/MUM/2012 7 2004-05 AND 2007-08 AND THE DEPARTMENT HAS ACCEPTED THE PROFITS EARNED ON SALE OF SHARES AS CAPITAL GAINS IN THE SCRUTINY ASS ESSMENTS . THE COPIES OF THE ASSESSMENT ORDERS ARE PLACED IN PAPER BOOK / PAGE 3 2-37. IT WAS SUBMITTED THAT EVEN FOR THE ASSESSMENT YEAR 2012-13 , THE REV ENUE HAS FRAMED THE ASSESSMENT U/S 143(3) OF THE ACT AND ACCEPTED THE G AINS ON SALE OF SHARES AS CAPITAL GAINS . THUS IT WAS SUBMITTED THAT THE REV ENUE HAS ACCEPTED IN ALL THE YEARS , THAT THE ASSESSEE IS AN INVESTOR AND TH E INCOME HAS BEEN ACCEPTED AS CAPITAL GAINS AND IT HAS NEVER ASSESSED AS BUSIN ESS INCOME EXCEPT DURING THE IMPUGNED ASSESSMENT YEAR. THE SAID ASSESSMENT ORDER IS PLACED IN THE FILE AS SUBMITTED BY THE ASSESSEES COUNSEL DURING THE COURSE OF HEARING BEFORE THE TRIBUNAL. THE ASSESSEE COUNSEL ALSO SUBM ITTED THAT THE ASSESSEE HAS ALSO NOT AVAILED ANY LOAN FOR THE PURPOSES OF I NVESTING IN SHARES/MUTUAL FUNDS. 8. THE LD. D.R. RELIED UPON THE ORDER OF THE LD. CI T(A). 9. WE HAVE CONSIDERED THE RIVAL CONTENTIONS AND ALS O PERUSED THE MATERIAL AVAILABLE ON RECORD. WE HAVE OBSERVED THAT THE ASS ESSEE HAS BEEN REGULARLY ASSESSED TO TAX IN THE PAST YEARS AND SCRUTINY ASSE SSMENTS HAVE BEEN FRAMED AGAINST THE ASSESSEE FOR ASSESSMENT YEARS 2003-04, 2004-05, 2007-08 AND 2012-13 U/S 143(3) OF THE ACT WHEREIN REVENUE HAS A CCEPTED THAT THE GAINS EARNED BY THE ASSESSEE ON SHARE TRANSACTIONS ARE TO BE ASSESSED TO TAX AS CAPITAL GAINS. THE ASSESSEE HAS EARNED PROFIT ON S ALE/PURCHASE OF SHARES WHICH WAS ASSESSED TO TAX UNDER THE HEAD PROFIT AN D GAINS FROM BUSINESS OR PROFESSION BY THE AO IN THE RELEVANT ASSESSMENT YE AR, INSTEAD OF GAINS BEING OFFERED TO TAX AS SHORT TERM CAPITAL GAIN BY THE AS SESSEE FOR THE IMPUGNED ASSESSMENT YEAR IN THE RETURN OF INCOME FILED WITH THE REVENUE. WE HAVE OBSERVED THAT IT IS ONLY FOR THIS IMPUGNED ASSESSME NT YEAR , WHEREBY THE SHORT TERM CAPITAL GAIN EARNED BY THE ASSESSEE ON S HARE TRANSACTIONS WERE ASSESSED TO TAX AS BUSINESS INCOME. THE ASSESSEE HAS RELIED UPON THE ITA 3757/MUM/2012 8 DECISION OF HONBLE BOMBAY HIGH COURT IN THE CASE O F GOPAL PUROHIT(SUPRA) . WE HAVE OBSERVED THAT NO BORROWED FUNDS WERE UTILIZ ED BY THE ASSESSEE FOR ACQUIRING SHARES. WE HAVE HOWEVER ALSO OBSERVED THA T HUGE TRANSACTIONS IN SHARES HAVE BEEN ENTERED INTO BY THE ASSESSEE DURIN G THE IMPUGNED ASSESSMENT YEAR, WHEREIN THE SHARES ARE BOUGHT AND SOLD REPEATEDLY OF THE SAME COMPANIES WITH A SMALL PERIOD OF HOLDING, WHIC H REFLECT INDICA OF TRADE WHEN THE TRANSACTIONS ARE SQUARED OF WITHIN A SHORT PERIOD OF TIME . HONBLE SUPREME COURT IN THE CASE OF G. VENKATASWAMI NAIDU & CO. V. CIT (1959) 35 ITR 594(SC) HELD THAT WHERE PURCHASE HAS BEEN MADE SOLELY AND EXCLUSIVELY WITH INTENTION TO RESELL AT PROFIT AND THE PURCHASE R HAS NO INTENTION OF HOLDING PROPERTY OR ENJOYING OR USING IT, PRESENCE OF SUCH AN INTENTION IS A RELEVANT FACTOR AND UNLESS IT IS OFFSET BY PRESENCE OF OTHER FACTORS, WOULD RAISE A STRONG PRESUMPTION THAT TRANSACTION IS IN THE NATURE OF TR ADE. THE VOLUME OF FREQUENCY IN THE CASE OF THE ASSESSEE WHILE DEALING IN SHARES IS HUGE. THE SHORT TERM GAIN OF RS. 2,47,33,233/- HAS BEEN DERIV ED FROM ABOUT 341 TRANSACTIONS AND FOR THIS THE ASSESSEE HAD SOLD SHA RES TO THE TUNE OF RS. 35,14,65,076/- AND THE COST OF THEIR PURCHASE WAS R S. 32,67,31,843/- , WHEREBY THE PERIOD OF HOLDING WAS 1 TO 30 DAYS WHER EIN NUMBER OF TRANSACTIONS WERE 75 , WHILE WHEREIN PERIOD OF HOL DING WAS FROM 31 TO 100 DAYS THE NUMBER OF TRANSACTIONS WERE 126 , WHICH SH OWED THAT THE MAXIMUM NUMBER OF SHARES WERE SOLD WITHIN 3 TO 4 MONTHS FRO M THE DATE OF PUCHASE. WE ARE ALSO CONSCIOUS OF THE FACT THAT PRINCIPLE OF RES-JUDICATA IS NOT APPLICABLE TO THE INCOME-TAX PROCEEDINGS BUT PRINCI PLE OF CONSISTENCY IS TO BE APPLIED , REFERENCE DECISION OF HONBLE SUPREME COU RT IN THE CASE OF RADHASOAMI SATSANG V. CIT (1992) 193 ITR 321 (SC). IN OUR CONSIDERED VIEW, INTEREST OF JUSTICE WILL BE BEST SERVED IF THE GAIN ARISING FROM THE SALE/PURCHASE OF SHARES WHICH ARE HELD FOR A PERIOD OF UP-TO 30 DAYS FROM THE DATE OF PURCHASE IS TO BE TREATED AS BUSINESS INCOM E, WHILE WHEREIN THE PERIOD OF HOLDING OF SHARES IS MORE THAN 30 DAYS, T HE GAINS ARISING THERE-FROM WOULD BE TREATED AS SHORT TERM CAPITAL GAIN/LONG CA PITAL GAIN DEPENDING UPON ITA 3757/MUM/2012 9 THE PERIOD OF HOLDING AS STIPULATED IN THE ACT. OUR ABOVE VIEW IS SUPPORTED BY SEVERAL DECISION OF THE TRIBUNAL , RECENT DECISION BEING ACIT V. DIMENSION CONSULTING PRIVATE LIMITED ORDERS DATED 20-09-2016( DELHI TRIBUNAL DECISION IN ITA NOS. 2321/DEL/2010 AND 1834/DEL/2012, CO NOS . 224/ DEL/2010 AND 217/DEL/2012 FOR ASSESSMENT YEARS 2006-07 & 200 8-09). WE ORDER ACCORDINGLY. 10. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IN ITA NO. 3757/MUM/2012 FOR THE ASSESSMENT YEAR 2008-09 IS PA RTLY ALLOWED AS INDICATED ABOVE. ORDER PRONOUNCED IN THE OPEN COURT ON 7 TH DECEMBER, 2016. # $% &' 07-12-2016 ( ) SD/- SD/- (MAHAVIR SINGH) (RAMIT KOCHAR) JUDICIAL MEMBER ACCOUNTANT MEMBER $ MUMBAI ; & DATED 07-12-2016 [ .9../ R.K. R.K. R.K. R.K. , EX. SR. PS !'#$%&%# / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. : ( ) / THE CIT(A)- CONCERNED, MUMBAI 4. : / CIT- CONCERNED, MUMBAI 5. =>( 99?@ , ?@ , $ / DR, ITAT, MUMBAI A BENCH 6. (BC D / GUARD FILE. / BY ORDER, = 9 //TRUE COPY// / ( DY./ASSTT. REGISTRAR) , $ / ITAT, MUMBAI