Hi Rakesh,
I tried the mentioned scenario on on MII 14.0 SP4 Patch 0 and it worked fine.
Following are the steps which I performed:
1. created a PCo Query with 5 cols and 1 row(TagRetrieve Query with Current View and 5 Tags).
2. created a transaction with an output parameter of type xml and assigned the PCo query result to the output param.
3. create an Xacute query and used the above transaction.
You are on SP3. Try upgrading the system to SP4.
Regards,
Rohit Negi.