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IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW ‘A’ BENCH, LUCKNOW

BEFORE SH. SUDHANSHU SRIVASTAVA, JUDICIAL MEMBER AND

SH. NIKHIL CHOUDHARY, ACCOUNTANT MEMBER

ITA No.174/LKW/2023 A.Y. 2014-15

Apurva RK Hotels India Pvt. Ltd., vs. Asstt. Commissioner of

5, Gautam Buddha Marg, Old RTO Income Tax, Range-1, CPoAmNp: AouAnICd,A L7u8c6k6nRow -226001, Lucknow

Uttar Pradesh

(Appellant) (Respondent)

Assessee by: Sh. P.K. Kapoor, C.A. Revenue by: Sh. Amit Kumar, DR

Date of hearing: 07.0 1.2026 Date of pronouncement: O3 0R.0 D3 .E2 0R2 6

PER NIKHIL CHOUDHARY, A.M.:

This is an appeal filed by the assessee against the orders of the ld. CIT(A)-

3, Lucknow under section 250 of the Income Tax Act, 1961 on 11.04.2023, wherein the ld. CIT(A), after considering fresh evidences brought on record by him, has confirmed the additions made by the AO but under another section. The grounds of appeal are “a1s. BuEnCdAeUr:S -E the Ld. CIT(A) has erred in law and on facts in confirming the action

of the assessing officer in treating short-term capital gain of Rs. 18,63,745/-as business income by holding that the claimed STCG was as a result of pre-arranged transactions used to bring back the unaccounted income in the capital and in

further making the addition of the said amount under section 68 of the Act.

2. BECAUSE the income of Rs. 18,63,748/- claimed in the return of income under the head short-term capital gain was derived from genuine transactions of sale of shares and view to the contrary taken by Ld. CIT(A) to the effect that the transactions were pre-arranged ones so as to bring back the unaccounted income is based on surmises and conjectures and consequently the order of Ld. CIT(A) is

not sustainable either on facts or in Law.

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ITA No.174/LKW/2023 A.Y. 2014-15 Apurva RK Hotels India Pvt. Ltd.

3. BECAUSE the assessing officer had wrongly treated the income of Rs. 18,63,748/-(claimed in the return of income as short-term capital gain) as business income on the ground that the assessee had made frequent sale and purchase transactions in the shares and the id assessing officer had not doubted upon the genuineness of the transactions resulting in capital gain to the assessee, the Id. CIT(A) could not have upheld the action of assessing officer and further making the addition under section 68, by completely changing the basis on which the assessing officer had changed the head of income, by allegedly holding the genuine sale transactions as pre-arranged ones used to bring back unaccounted

income in the capital

4. BECAUSE on a due consideration of material and information placed on record, the Ld. CIT(A) was not correct in confirming the action of the Assessing Officer in shifting the head of income from "Income from capital gains" to "Profits and gains of business or profession and also in making addition of the said amount under

section 68 of the Act.

5. BECAUSE the income of Rs. 18,63,748/-was derived by the assessee from the sale of shares held as "investment" therefore the income derived from transfer of such shares was correctly claimed by the assessee under the head "Short Term

Capital Gains" and consequently claim of the assessee deserved to be accepted

6. BECAUSE while upholding the action of the Assessing Officer in treating the claimed "Short Term Capital Gains" as business income, the Ld. CIT(A) failed to consider the material and information placed on record and the CBDT's guidelines contained in Circular No. 4/2007 dated 15.06.2007 read with earlier

instruction no. 1827 dated 31.08.1999

7. BECAUSE while upholding the action of Assessing Officer in treating the claimed "Short Term Capital Gains" as business income, the Ed. CIT(A) also failed to appreciate that on identical facts the Hon'ble ITAT had dismissed Revenue's appeal for Assessment Year 2012-13 in assessee's own case by upholding the order of Ld. First Appellate Authority accepting the claim of "Short Term Capital

Gains" as there is no change in the facts of the case in the year under app