Description:
- Given the definitions of the term “business” and “capital asset” in Ss. 2(13) and 2(14), shares, If held for more than 12 months, will be a long- term capital asset, in spite of continued and systematic dealings;
- On facts, as the assessee had engaged a portfolio manager to look after to buy and sell were taken by the portfolio manager and not by the assessee, the assessee cannot be called a “dealer”;
- The object of the PMS was to maximize the value of the portfolio. It was “wealth maximization” and not “Profit maximization”;
- In the balance sheet, the shares were valued at cost and not at lower of cost or market value.ARA Trading & Investment Pvt. Ltd. vs. DCIT (Pune) (ITAT).
Source:
1. www.aiftponline.org
2. AIFTP TIMES Volume.No.2 August, 2011, Page No.8.
3. www.itatonline.org.
Our Comment:
Only the actual trader will be treated for capital gains but not who deal through portfolio manager
