|QUERY:||I am holding some shares for investment purposes and other shares for trading. I have made gains from the investment shares. Is the AO correct in treating the gains as business income?|
|ANSWER:||Click here to read the full answer of the expert|
|SECTION(S):||28, 45, 48|
|CATCH WORDS:||business profits, capital gains, shares, stock-in-trade|
No! One has to be careful to ensure that there is a proper segregation of the shares held on investment account from the shares held on trading account. The investment shares must be valued at cost while the trading shares can be valued at market price if that is lower.