PCIT vs. NDR Promoters Pvt. Ltd (Delhi High Court)
S. 68 Bogus share capital in form of
accommodation entries: The transactions are clearly sham and make-believe with
excellent paper work to camouflage their bogus nature. The reasoning is
contrary to human probabilities. In the normal course of conduct, no one will
make investment of such huge amounts without being concerned about the return
and safety of such investment. The Tribunal's order is clearly superficial and
adopts a perfunctory approach and ignores evidence and material referred to in
the assessment order
The transactions in question were
clearly sham and make-believe with excellent paper work to camouflage their
bogus nature. Accordingly, the order passed by the Tribunal is clearly
superficial and adopts a perfunctory approach and ignores evidence and material
referred to in the assessment order. The reasoning given is contrary to human
probabilities, for in the normal course of conduct, no one will make investment
of such huge amounts without being concerned about the return and safety of
such investment
PCIT vs. Hardik Bharat Patel (Bombay High Court)
Capital Gains vs. Business Profits:
As per CBDT Circular No. 6 of 2016 dated 29.2.2016 gains on shares held for
more than 12 months are treated as long-term capital gains and not as business
profits. The fact that the amount invested in shares were out of borrowed funds
and there were frequent and voluminous transactions is irrelevant
Our attention is drawn to Circular
No. 6 of 2016 dated 29.2.2016 issued by the Central Board of Direct Taxes
(CBDT). This circular issued with regard to the issue of taxability of surplus
on sale of shares and securities, – whether as capital gain or business income
in case of long term holdings of shares and securities i.e in excess of 12
months. It has clarified therein that with a view to reduce litigation and
uncertainty in the matter of taxibility, as long term capital gains or business
income – the assess has an option to treat the income from sale of listed
shares and securities as income arising under the head ‘Long Term Capital
Gains’, them the same shall be accepted by the assessing officer
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