how to show the securities held by assessee as stock in trade to department....is there any kind of formalities to be done by assessee or just show pgbp income in return?
Supreme Court in the case of G.Venkata Swami Naidu & co. Vs. CIT (1959) 35 ITR 594. The Supreme Court held that in deciding the character of such transaction, several factors were relevant. For instance:-
i. Whether the purchaser was a trader and the purchase of the commodity and its resale were allied to his usual trade or business or were incidental to it.
ii. The nature and quantity of the commodity purchased and resold – if the commodity purchased is in very large quantity, it could tend to eliminate the possibility of investment for personal use, possession or enjoyment.
iii. The repetition of the transaction. If department raise any objection These instructions may please be brought to the notice of the Assessing officers in your region.
[F.No 181/1/89 – IT(AI) dated 31/08/1989 from Central Board of Direct Taxes]
Circular 6/2016 stand that assessee can show securities as sit or capital asset at his option once in life time...and department cannot raise any questions
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