Share Gains Treated as Capital Gains Due to Consistent Treatment

PCIT Vs Smt. Sarah Faizal Hawa (Bombay High Court) The appeal before the Bombay High Court arose under Section 260A of the Income Tax Act, 1961, concerning Assessment Year 2007–08. The core issue was whether the assessee should be treated as an investor in shares or as a trader, thereby determining whether income from sale of shares should be taxed as capital gains or business income. The Assessing Officer held that the assessee was a trader, citing factors such as alleged borrowing of ₹2.35 crore, significant volume of share transactions, and absence of other business activities. Accordin...