Joy Beauty Care (P) Ltd. Vs DCIT (ITAT Kolkata)
Ld. CIT(A) had accepted that the gains on sale of shares through Portfolio Management Services (PMS) providers to be taxed under the head capital gains. Against these findings of the Ld. CIT(A), the revenue has not preferred the appeal before us as per the material available on record. The assessee placed reliance on the decision of Co-ordinate Bench of Pune Tribunal in the case of KRA Holding & Trading Pvt. Ltd. vs DCIT in ITA Nos. 499, 500, 1320 to 1322 of 2008 and 434 of 2009 and 806 of 2009 dated 31.05.2011 reported in 2011 (5) TMI 498 ITAT Pune. There were primarily two issues before the Pune Tribunal in the aforesaid cases:-
- Whether the transactions of purchase and sale of shares carried out through PMS providers would be taxed under business income or under the head capital gain.
- Whether PMS providers fees paid to M/s. ENAM would be allowable as deduction under section 48 of the Act.
Both the questions were decided in favour of the assessee by the Pune Tribunal.
Respectfully following the said decision, we hold that the PMS fees paid by the assessee in the sum of Rs. 18,93,788/- is eligible for deduction while computing Short Term Capital Gain. Accordingly, ground no 2 raised by the assessee is allowed.
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