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TMI Blog2014 (10) TMI 935X X X X Extracts X X X X X X X X Extracts X X X X ..... he solitary issue raised by the assessee is against the action of the income-tax authorities in not allowing the deduction of Portfolio Management Services (PMS) fees paid by the assessee of Rs. 2,23,05,158/- while computing income from capital gains. As per the assessee, the PMS fee represents expenditure incurred wholly and exclusively in connection with the purchase and sale of securities managed under a portfolio management by the PMS Manager and is thus a deductible expenditure while computing capital gains. 3. The appellant before us is a company incorporated under the provisions of the Companies Act, 1956 and is registered with Reserve Bank of India as an investment company belonging to the promoters of the Thermax group of companie ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the deduction of part of PMS fee paid by the assessee while computing capital gains. The following discussion in the order of the Tribunal is relevant :- "6. The issue before us is with regard to deduction of part of Portfolio Manager's (PMS) fee paid by the assessee while computing capital gain. We find that ITAT Pune 'A' Bench in the case of ARA Holding & Trading Pvt. Ltd. and others in ITA No.94/PN/2012, has decided a similar issue in favour of the assessee by observing as under: "13. We have carefully considered the rival submissions and also the precedent in the assessee's own case by way of the order of the Tribunal dated 25.07.2012 (supra). In the said case, the Tribunal considered the allowability of expenditure incurred by way ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ibunal declined to follow the decision in the case of KRA Holding & Trading (supra). It is the settled proposition of law that when two view are possible on the same issue the view which is favourable to the assessee has to be followed. [CIT vs. Vegetable Products 88 ITR 192 (SC)]. Further, in the instant case the Tribunal in assessee's own case has already taken a view in favour of the assessee. Since the AO & CIT(A) have followed the order for earlier year in the case of the assessee and since the order of CIT(A) for earlier year has been reversed by the Tribunal, therefore, unless and until the decision of the Tribunal is reversed by a higher court, the same in our opinion should be followed. In this view of the matter, we respectfully f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r profession"? Nothing was filed before us to substantiate that the Revenue has gone on appeal against the order of the Tribunal allowing the claim of Portfolio Management fees as an expenditure from such capital gains. 11. The decision of Mumbai Bench of the Tribunal in the case of Homi K. Bhabha Vs. ITO was brought to our notice by the learned DR wherein it was held that Portfolio Management Scheme fees is not deductible against capital gains. The decision of the Pune Bench of the Tribunal in the case of KRA Holding & Trading was not followed by the Mumbai Bench in the above cited decision. The Mumbai Bench following other decisions of the coordinate Benches of the Tribunal declined to follow the decision in the case of KRA Holding & ..... X X X X Extracts X X X X X X X X Extracts X X X X
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