Capital Gains

This query is : Resolved

Mangesh (Querist)
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30 November 2009 Can capital gains on sale of shares be treated as business income by Assessing officer if it is only income of assessee ? Can u quote any case law / circular in this matter. All shares are delivery based and intension was to make investment.

HUZAIFA HUSSAIN

HUZAIFA HUSSAIN (Expert)
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30 November 2009 It depends on how often u do transactions of shares and r u purchasing the shares and securities as an investment or stock in trade. If it is done on a regular basis , and is the only source of income than ofcourse it is assessable as business income.

Mangesh

Mangesh (Querist)
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30 November 2009 Does person only has capital Gain income is determining point to treat it as business income ? Please quote any reference to case law or circular/notification by department.

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CA. Vinod Pandey

CA. Vinod Pandey (Expert)
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01 December 2009 Capital gain income is totally different from business income. If you see the meaning of short term capital gain that is depend on time period for holding the capital assest. And in case of share holding period is counted less than one year for STCG. Period of less than one year may be even one day. Further, whether you transact on regular basis or for investment purpose. Gain arises on this to be taxed under 'Income from Capital Gain' rather business income.

MAHENDRA KUMAR BAGRECHA

MAHENDRA KUMAR BAGRECHA (Expert)
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11 December 2009 It is depend on the volume of the transactions. CBDT has issued a notification regarding this and has given guidelines to AO, has to treat the cases of share tradings. Kindly go through that notification.Thanks