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2018 (6) TMI 1275 - ITAT PUNEChargeability of gains earned on sale of securities under the head ‘Capital Gains’ or ‘Business Income’ - Port Folio Management Services are availed by the assessee in earning such gains - Held that:- The volume and frequency of transactions sought to be made out by the Assessing Officer with regard to the impugned activity stands on an entirely different footing and is quite distinct from the activity of trading in shares carried out by the assessee. In fact, it is notable that in the share trading business carried on by the assessee, he has carried out certain speculative and trading activities and that in the case of a PMS provider, such activities are prohibited in law. Having regard to the aforesaid discussion by the Commissioner of Income-tax (Appeals), which is borne out of the record, we, therefore, find no reasons to uphold the plea of the Assessing Officer on the basis of the volume and frequency of transactions. It is undisputed that the assessee has been consistently employing the services of PMS – Kotak Securities Ltd. for augmenting the value of securities and the same are shown under the head ‘Capital Gains’. The pattern of investment is one and the same in this year also. Assessing Officer disturbed the assessee’s claim by treating the said income as taxable under the head ‘Profits and Gains from Business or Profession’. On similar facts, relying on the Pune Bench decision in the case of Shri Apoorva Patni Vs. Addl.CIT [2012 (9) TMI 828 - ITAT, PUNE], the CIT(A) granted relief to the assessee by holding that when the income earned by the assessee out of investments in securities using specialized professional services of PMS – Kotak Securities Ltd., such income becomes taxable under the head ‘Capital Gains’ and the same should not be construed as ‘Business Income’. - Decided against revenue
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