2012 (7) TMI 969

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....ection 10(2A) of the Income Tax Act, 1961. The assessee is also director in Ecolab Hygiene Chemicals Pvt Ltd., and Nalin Pharmaceuticals Pvt. Ltd. 3. In the appeal under consideration the issue involved is as to whether capital gain of ₹ 33,32,310/- arising out of sale of shares, units and Securities through Portfolio Management Services is to be assessed under the head "capital gains" or "business income". The ground of appeal taken by assessee reads as under: "1. On the facts and circumstances of the case and in law, the learned Commissioner of Income Tax(Appeals) erred in confirming the addition Capital Gains (arising out of sale of shares, units and securities through Portfolio Management Services) of ₹ 33,32,310/- as "Pr....

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....ssessed under the head "capital gain" or under the head "business income". 6. During the Financial Year 2002-03, assessee placed fund of ₹ 50,00,000/- with M/s. Kotak Securities as his Portfolio Manager (PMS) for purchase and sale of shares. Income derived from PMS account was offered under the head "business and profession" while filing the return for that AY. The AO did not accept the contention of the assessee and treated the income/earning on PMS account as business income of the assessee. The assessee filed appeal before ld CIT(A). 7. On behalf of assessee, it was contended that assessee is a partner in partnership firms carrying on business of "Indenting Agent". He is also director in Private Limited Companies. The assessee i....