Shares income

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Querist : Anonymous

Querist : Anonymous (Querist)

01 November 2011 one of our client is having income from business & profession and he is also dealing in shares but in individual name not in firm name on regular basis.
can we still show his income from shres transcation undre capital gain or is it necessary to show as B&P income?

Also one of our client is dealing in shares in firm name along with their usual work of trade then in such case income from shares can be shown under capital gain head?

plz sugeest as LTCG on shares is exmept

CA PARAS BAFNA

CA PARAS BAFNA (Expert)
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01 November 2011 Q.- one of our client is having income from business & profession and he is also dealing in shares but in individual name not in firm name on regular basis.
can we still show his income from shres transcation undre capital gain or is it necessary to show as B&P income?

Reply-

It is not always necessary that the income from Share Transactions has to be shown as B&P income.

It depends upon the manner in which the assessee deals. Suppose he purchases 500 shares and keeps it for 1 month or more. It can be said as an investment activity.

If he regularly makes high value transactions, in compare to his investment, and frequently deals in number of scrips, then the activity may be treated as Trading Activity.

CA PARAS BAFNA

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01 November 2011 Q- Also one of our client is dealing in shares in firm name along with their usual work of trade then in such case income from shares can be shown under capital gain head?
.
Reply-
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The same thing applies here.

If the shares are kept with the intention of investment, capital gains can be shown on sale.

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