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TMI Blog2016 (4) TMI 903X X X X Extracts X X X X X X X X Extracts X X X X ..... AB/III-188/10-11) dismissed the appeal of the assessee. Aggrieved by the order of ld. CIT(A), assessee is now in the appeal before us and has raised the following grounds: "1. Ld. CIT (A) erred in law and on facts in confirming action of AO in treating short term capital gain on sale of mutual funds / shares as business income of the appellant. Both the lower authorities failed to appreciate the fact that capital appreciation being the sole motive, shares acquired from own funds were sold after holding for reasonable period of time. The order of Id. CIT (A) being perverse and against facts of the case deserves to be quashed and the claim of the appellant treating gains on sale of mutual funds / shares as short term capital gains be allowed. 2. Ld. GIT (A) further erred in law and on facts in not only treating income from investments through Portfolio Management Services (PMS) as business income but also in presuming that the investment activity of the appellant was with a motive to earn profit and not dividend. Ld. CIT (A) thus erred in confirming action of AO in treating short term capital gain on investment in shares by the appellant as business income. Ld. CIT (A) ought to ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 7 and have been sold starting from April 2007 to December 2007. Besides this, the assessee has used 3 schemes of Port Folio Management services (PMS) for making transactions in shares and securities which are as follows: - Kotak Incubater Equity Portfolio: - Kotak Opportunity 2010 PMS - HSBC Assets Management PMS Scheme 4.3.1 The appellant was asked to submit its accounts in the books of these PMS during the course of appellate proceedings, which has been submitted. So far as details relating to Kotak Securities are concerned, the activity in one scheme has started from 21.3.2007 and in the other scheme from 19.9.2007. But the breakup of equities in which the Investments have been made on different dates has not been provided. The details give only consolidated amounts on account of purchase or sales of shares on a particular day under the heading "investment in equity". Besides this the STT paid and the brokerages etc. are also reflected in the detail. The transactions are numerous and quite frequent over the entire period till 31.3.2007. Almost on daily basis the sale and purchase of equities are being conducted in both the schemes and on both the stock exchanges i.e NSE ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aim that the gain resulting from PMS must be taxed as short term capital gain only. But the latest decisions of other benches of ITAT have deferred from the decisions relied upon by the appellant. It may be mentioned here that in the decision in [2010] 40 SOT 566 (AHD.), Sar Investment (P.) Ltd. v. Deputy Commissioner of Income-tax, Circle-8, Ahmedabad, the jurisdictional bench of ITAT had refused to accept the argument that simply because the activity of share trading is being done through PMS of Kotak Mahindra, hence the resultant income should be treated as capital gain. Further, in following decisions, facts of which are identical to the present case, the profits earned on account of transactions done through PMS, have been held to be business income: i) [2012] 18 taxmann.com 20 (Delhi.), IN THE ITAT DELHI BENCH 'F', Radials International v. Assistant Commissioner of Income-tax, Circle 27(1), New Delhi. In this decision it has been held as follows: ----------------------------------------------------------------------------------------------------------- ------------------------------------------------------------------------------------------- ii) [2012] 17 taxmann.com ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f ld. CIT(A), assessee is now in appeal before us. 8. Before us, Ld. A.R. reiterated the submissions made before lower authorities and further submitted that ld. CIT(A) had mainly relied on the decision of Delhi Bench of Tribunal in the case of Radials International vs. ACIT (supra) while deciding the issue against the assessee. He submitted that the aforesaid decision of Hon'ble Tribunal which has been relied upon by ld. CIT(A) has been reversed by the Hon'ble Delhi High Court and it is reported in [2014] 367 ITR 1 (Del). He further submitted that on similar issue, Hon'ble Karnataka High Court in the case of CIT vs. Kapur Investments (P.) Ltd. (2015) 61 taxmann.com 91 (Karnataka) has also followed the aforesaid decision of Hon'ble Delhi High Court. He, therefore, submitted that in view of the aforesaid decisions of Hon'ble High Courts, the investment made by the assessee through Portfolio Management Services (PMS) cannot be termed as business of the assessee. Ld. D.R. on the other hand supported the orders of A.O. and ld. CIT(A). 9. We have heard the rival submissions and perused the material on record. The issue in the present case is about the treatment of profits earned on sa ..... X X X X Extracts X X X X X X X X Extracts X X X X
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