Custom Post Type with Custom Taxonomy as Category

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This might solve your issue, and frankly, rewrites are still a little mistery to me, so I would not be able to help you out there, but there are two major issues in your code which you should first sort out before you try to sort out your rewrites

  • Custom post type names (and for that matter, function names and custom taxonomy names) should be all small letters and words separated by underscores. Your custom post type name starts with a capital letters. This can result in some issues later

  • Your rewrite slug for your taxonomy is wrong. Have a look at it. Slugs should be lowercase and words should be separated by hyphens. Your rewrite slug currently is Portfolio Category which will not work. You have to try something like portfolio-category

Make these changes and remember to flush your rewrite rules on completion of these changes otherwise these changes won’t take effect. Once this errors is corrected, then you can start looking at your rewrite problem