SANJEEV MITTAL Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) THE assessee is aggrieved by the order of the Income Tax Appellate Tribunal (hereinafter referred to as "the ITAT") to the extent that it remitted the case for reconsideration by the Assessing Officer (AO) on the assumption that additional evidence had been filed, or was sought to be led by the assessee. The question sought to be urged is whether in the circumstances of the case the nature of the remand ought to have been limited, given that the CIT(Appeals) considered all materials on record and held that the sum of ?1,97,17,460/ -, reported during assessment year 2007 - 08, constituted capital gains.

(2.) THE assessee concededly is a medical practitioner. He reported ?1,39,097/ -, as his professional income in his returns. The AO noticed that professional receipts of the appellant amounted to ?7,49,500/ -. This was a mere 1/37th of the gains from transactions in shares. Before the AO, the appellant contended that the said amount of ?1,97,17,460/ - constituted capital gain and could not be treated as professional or business income. The assessee's primary submission was that in the concerned assessment year, 57 transactions recording sale of shares of various companies held by him, for periods ranging from 366 days to over 1150 days were involved. Consequently, given the settled position in law on the question of whether the income was a capital account or a business income, it had to be treated as capital gain. The AO however rejected this contention and treated the entire amount as business income, thus applying a higher rate of tax. The assessee's appeal to the CIT(Appeals) succeeded. The CIT(Appeals) pertinently held as follows :

(3.) LIKEWISE the CIT(Appeals) noted that even though certain loans had been availed from banks and private sources the materials on record did not suggest any link between the acquisition of shares, which were ultimately sold, and the availing of such credit. The CIT(Appeals) pertinently noticed that "It may be worth noting, however, that all the gains resulted during the year in question were from the holdings of the prior period when the credit line from the bankers were started availing by the appellant. Moreover, the interest paid on loans was neither claimed as an expense against LTCG/STCG nor against professional income."