2014 (4) TMI 661

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....me are discussed in brief. The assessee had claimed deduction of fee paid to Portfolio Manager amounting to Rs.2,60,764/- against the short term capital gain, claiming the same as expenditure incurred wholly and exclusively in connection with the transfer of shares. The AO disallowed the said claim and the Ld CIT(A) also upheld the said disallowance. Subsequently, the AO commenced the penalty proceedings u/s 271(1)(c) of the Act against the above said addition of Rs.2,60,764/-. The assessee submitted that he had claimed the deduction, cited above, on the basis of various court decisions. He further submitted that the addition has been made due to difference of opinion on the matter and accordingly prayed that the penalty should not be levie....

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....u/s 271(1)(c) of the Act. According to the AO, the assessee has failed to discharge the burden placed upon him under Explanation 1 to sec. 271 of the Act. 6. However, we notice that the assessee has furnished an explanation to the effect that he had claimed the deduction of Portfolio Management fee against the Short term capital gain on the basis of decisions rendered by the Tribunal. In the written submission, the assessee has pointed out that the Mumbai bench of Tribunal in the case of KRA Holding & Trading P Ltd Vs. DCIT and also in the case of ITO Vs. Radha Birju Patel (mum) (citation not given) has taken the view that the Portfolio Management charges are deductible as expenses. Thus, we notice that the assessee has drawn support for....