7/16/2020 delhihighcourt.nic.in/dhcqrydisp_o.asp?pn=21399&yr=2015 IN HIGH COURT OF DELHI AT NEW DELHI ITA 544/2013 COMMISSIONER OF INCOME TAX Appellant Through: Mr. N.P. Sahni, Sr. Standing Counsel. versus CHOWDRY ASSOCIATES Respondent Through: Mr. M.P. Rastogi with Mr. K.N. Ahuja, Advocates. CORAM: HON'BLE MR. JUSTICE S. RAVINDRA BHAT HON'BLE MR. JUSTICE R.K.GAUBA ORDER 30.01.2015 Revenue appeals to this Court under Section 260A of Income Tax Act, 1961 urging that ITAT fell into error in holding that sum of Rs.1,19,30,037/-, held by Income Tax Appellate Tribunal (hereafter referred to as ?ITAT?) to be short term capital gain, is in fact business income. brief facts are that respondent/assessee is non-banking finance company. In course of its finance activities, it had purchased and sold shares for sum of Rs.1,19,30,037/-. It is contended - in its return - that income on that count was short term capital gain. Assessing Officer (AO) rejected contention, holding that said amount was business income and brought it to tax on that count. assessee succeeded in appellate proceedings - both before CIT (A) and in course of Revenue?s appeal before ITAT. At outset, this Court notices that bulk of shares held by assessee were for substantial period; this persuaded delhihighcourt.nic.in/dhcqrydisp_o.asp?pn=21399&yr=2015 1/2 7/16/2020 delhihighcourt.nic.in/dhcqrydisp_o.asp?pn=21399&yr=2015 appellate authorities to hold that test indicated by previous rulings of Supreme Court, as to whether income was derived on account of liquidation of investments, stood satisfied. In similar circumstances, in Commissioner of Income Tax v. Devasan Investments Pvt. Ltd. (ITA 1102 and 1103/2011, decided on 16.04.2014) and other decisions, this Court has held that there cannot be single factor or criterion to determine whether income falls under head of short term capital gain or of business income. ITAT has followed reasoning indicated in judgment of Supreme Court and appropriately applied tests. Consequently, we find no infirmity in this order. No substantial question of law arises. It is, however, urged on behalf of appellant that no claim for expenditure could have been allowed, given that income is not business income. Consequently, we hereby direct that while giving effect to order of ITAT, AO shall examine permissibility of expenditure in relation to short term capital gain as well as in relation to business income, in accordance with law. appeal is disposed of in above terms. S. RAVINDRA BHAT, J R.K.GAUBA, J JANUARY 30, 2015 vikas 5-9 delhihighcourt.nic.in/dhcqrydisp_o.asp?pn=21399&yr=2015 2/2 Commissioner of Income-tax v. Chowdry Associate