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TMI Blog2012 (7) TMI 960X X X X Extracts X X X X X X X X Extracts X X X X ..... . 2004-05 i.e. ITA No.2126/M/2008 as a lead appeal and, therefore, discuss the facts and same will apply mutatis-mutandis for the appeal for the next AY as far as applicability of the proposition and law are concerned. 4. In the appeal for the assessment year 2004-05, main issue involved is as to whether capital gain of Rs. 1.04 Crores arising out of sale of Shares, Units and Securities through Portfolio Management Services(PMS)is to be assessed under the head 'capital gains' or 'business income'. The ground of appeal taken by assessee-HUF reads as under: '1. On the facts and circumstances of the case and in law, the learned Commissioner of Income Tax (Appeals) erred in confirming the addition Capital Gains (arising out of sale of Shares ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ative gains respectively. AO treated the net PMS receipts, i.e. Rs. 1.04 Crores, as profits and gains of business and profession. 6. The assessee-HUF was a partner in one of the partnership firms which was engaged in the business of indenting agent. From June, 2001 to August, 2003 assessee-HUF placed certain funds with portfolio manager. 7. During the assessment year 2003-04, assessee-HUF had offered the income derived from PMS under the head 'business and profession' while filing the return. But, for the year under consideration assessee-HUF offered the income from the said transactions under the head capital gains and vide its letter dated 15.09.2006 addressed to the AO reiterated its claim.The AO did not accept the contention of the as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ound No.3 of appeal is in respect of interest u/s.234C of the Act, which is consequential and does not require any specific adjudication. 12. Now we take up appeal for assessment year 2005-06 being I.T.A. No.4125/M/08. 13. Grounds of appeal are as under: '1. On the facts and circumstances of the case and in law, the learned Commissioner of Income Tax (Appeals) erred in confirming the additional Capital Gains (arising out of sale of Shares, Units and Securities through Portfolio Management Services) of Rs. 1,09,10,217/- as 'Profit and Gains of Business or Profession'. Under the facts and circumstances of the case the Learned Commissioner of Income Tax (Appeals) ought to have accepted that a sum of Rs. 1,35,54,604/- as Short Term Capital ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he assessee-HUF in respect of transactions through Portfolio Manager. Ld D.R. did not dispute the above facts. 15. We have considered submissions of ld representatives of parties. Following the reasoning given by us while deciding the appeals of Manan Nalin Shah in ITA Nos.6166/ Mum/ 2008, 2125/ Mum/2008 and 4126/Mum/2008 for the AY 2003-04, 2004-05 and 2005- 06,vide order dated 06.07.2012,we hold that the profit to the assessee-HUF in respect of transactions through PMS is an investment and is to be assessed under the head 'capital gain'. Hence, Ground No.1 of the appeal is allowed in part as indicated above. 16. Ground No.2 of appeal is in respect of interest u/s. 234B & 234C of the Act, which is consequential and does not require any s ..... X X X X Extracts X X X X X X X X Extracts X X X X
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