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TMI Blog2014 (9) TMI 1045X X X X Extracts X X X X X X X X Extracts X X X X ..... C.H. Naniwadekar Respondent by : Shri Rajesh Damor ORDER PER R.K. PANDA, AM : The above 4 appeals filed by the Revenue in case of different assessees are directed against the separate orders dated 22-04-2013 of the CIT(A)-II, Pune relating to Assessment Year 2009-10. Since identical grounds have been taken by the Revenue in all the above appeals, therefore, these were heard together and for the sake of convenience these are being disposed of by this common order. ITA No.1835/PN/2013 (Smt. Sadhana Ashok Kumar Patni) : 2. Grounds of appeal No.1 to 4 by the Revenue read as under : (1) The Learned Commissioner of Income-tax (Appeals) erred in holding that the activity of transaction in shares/mutual fund by engaging PMS was an investment activity and resultant gain/loss was assessable under the head Capital Gains . (2) The Learned Commissioner of Income-tax (Appeals) erred in not appreciating the fact that the assessee had carried out business of trading in shares/mutual funds in a systematic and organized manner by utilizing the services of Portfolio Management Service Providers to act as an agent. (3) The Learned Commissioner of Income-tax (Ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s assessable under the head capital gains . The relevant observation of the CIT(A) reads as under : 3.2 I have considered the submission of the appellant and material available on record. I also perused the appellate orders in appellant's case for earlier years. This particular issue of taxing profit on sale of shares as business income by the A.O. has been elaborately discussed in the above referred orders and it was held that the activity of transactions in shares / mutual funds by engaging the PMS was an investment activity and the resultant gain was assessable under the head 'capital gains'. This view was further upheld by the Hon'ble ITAT Pune, vide combined order dated 27.09.2012 passed in the case of the appellant and other related cases in ITA Nos. 1534, 1535, 1568, 1569, 1570 and 1571/PN/11. The relevant operative paras of the ITAT's order dated 27.09.2012 are reproduced below: 6 ................We find the Tribunal following the order of the Tribunal in the group cases for A. Y. 2006-07, allowed the claim of short term capital gain and long term capital gain from gain in respect of investment through PMS service as against 3................ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re, it was to be regarded as business activity. Factually speaking on this aspect the Commissioner of Income-tax (Appeals) has dealt with the same in para 4.17 of his order, which is as under: 4.17....................................................... 14. . Considering the aforesaid matters, we, therefore, are of the view that the objections made out by the Assessing Officer have been adequately addressed by the Commissioner of Income-tax (Appeals) in coming to his findings that the investments carried out by the assessee through the PMS provider do not result in a gain assessable as business income. 15. In view of the aforesaid discussion, and having regard to the reasonings extended by the Commissioner of Income-tax (Appeals) with which we hereby affirm, we find that the grievance of the Revenue in this appeal is misdirected and accordingly the conclusion arrived at by the Commissioner of Income-tax (Appeals) on this aspect is hereby affirmed. Respectfully following the decision of the Tribunal in assessee's own case and in absence of any contrary material brought to our notic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ds as under : (5) The Learned Commissioner of Income-tax (Appeals) erred in holding that since no expenditure has been incurred, disallowance u/s.14A cannot be made dehors the specific provisions of section 14A(3) of the Act ? 6.1 Facts of the case, in brief, are that the AO during the course of assessment proceedings noted that the assessee has earned profits from the activities of share trading from PMS and has also earned tax free dividends. He, therefore, was of the opinion that disallowance u/s.14A is required in respect of the share business. He accordingly disallowed an amount of ₹ 12,82,776/- u/s.14A of the I.T. Act which he calculated by taking 0.5% of the average investment. 7. In appeal the Ld.CIT(A) following the decision of the Tribunal in assessee s own case vide consolidated order dated 27-09-2012 deleted the disallowance made by the AO by observing as under : 4.2 This has also been elaborately discussed in the appellate order passed by the undersigned vide No. PN/CIT(A)-II/DCIT Cir-2, PN/154/10- 11 dated 06.09.2011 and upheld by the Hon'ble ITAT Pune, vide combined order dated 27.09.2012 passed in the case of the appellant and other related ..... X X X X Extracts X X X X X X X X Extracts X X X X
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