M/s Abhipra Capital Limited Vs. DCIT (Investigation) (Delhi High Court)
It is an accepted and admitted position that Rs. 5,00,000/- was paid by the appellant- assessee to acquire membership of the National Stock This was a fixed amount, which was paid at one time and is not an annual subscription fee. Without payment of the said amount, the appellant- assessee could not have acquired membership of the National Stock Exchange. On acquisition of membership, the appellant acquired right to trade in shares and act as a broker. Deposit of this amount was sine-qua-non for issue of and entitlement to the broker’s card. With the said card and having acquired membership, the assessee could enjoy benefits and privileges of a member which would enable it to carry on trade in said capacity.
Section 2 (14) of the Act defines “capital asset” as property of any kind held by the assessee, whether or not connected with the business or profession, but does not include any stock-in-trade, consumable stores or raw materials held for the purpose of business or profession. It is not the case of the appellant- assessee that the membership deposit was stock-in-trade, consumable or raw material for the purchase of business. The membership card was an asset or a property which the petitioner had acquired on non-refundable payment of Rs. 5,00,000/-. It was on acquisition of the said card/membership that the appellant could carry on business as a stock-broker, subject to other compliances including annual fee payment.
