CORTEVA AGRISCIENCE SEEDS PRIVATE LIMITED,HYDERABAD V. ADDL.CIT, SPECIAL RANGE-7, NEW DELHI

MA 406/DEL/2025

AI Insights

Corteva Agriscience Seeds Pvt. Ltd. filed three Miscellaneous Applications pertaining to the Assessment Years 2013-14, 2014-15, and 2015-16, respectively, challenging the Tribunal's earlier decision which denied them exemption on income earned from the sale of hybrid seeds under section 10(1) read with section 2(1A) of the Income-tax Act. The Tribunal had previously confirmed the disallowance of agricultural income claimed as exempt and treated it as business income. The assessee contended that if the income was to be treated as business income, it should be computed under the normal provisions of the Act, specifically sections 28 to 43B. The Tribunal acknowledged the oversight in not addressing this computation in their earlier decision and rectified it by allowing the additional ground of appeal.

• Counselvise Citation: [2026] 140 COUNSELVISE.COM (IT) 841192 (ITAT-DELHI)
• Duration Of Justice: 3 month(s) 29 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 26-02-2026
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: I
• Assessment Year: 2015-2016
• Appeal Filed On: 28-10-2025
• Other Referred Cases: Honda Siel Power Products Ltd: 295 ITR 466 (SC), Lachman Dass Bhata Hingwala (P) Ltd vs ACIT: 330 ITR 243 (Del) (FB)
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAJESH KUMAR
• Assessee Lawyers: ADITYA VOHRA; AAKRITI BANSAL
• Keywords: Business income; Opportunity of being heard; Transfer pricing; Earning of tax free income
• Section: 28; 43B

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH, I: NEW DELHI BEFORE SHRI VIKAS AWASTHY, JUDICIAL MEMBER AND SHRI BRAJESH KUMAR SINGH, ACCOUNTANT MEMBER MA No.- 408/Del/2015 (Arising out of ITA No.- 1575/Del/2018) [Assessment Year: 2013-14] Corteva Agriscience Seeds Pvt. Ltd., {formerly known as PHI Seeds Limited) V-Ascends, Atria Block, 12th Floor, Plot No. 17, Software Units Layout, Madhapur, Hyderabad Telangana, 500081. Vs Addl. CIT, Special Range-7, Room No. 211, C.R. Building, Delhi-110002. PAN- AACCP3920F Assessee Revenue MA No.- 407/Del/2015 (Arising out of ITA No.- 7375/Del/2018) [Assessment Year: 2014-15] Corteva Agriscience Seeds Pvt. Ltd., {formerly known as PHI Seeds Limited) V-Ascends, Atria Block, 12th Floor, Plot No. 17, Software Units Layout, Madhapur, Hyderabad Telangana, 500081. Vs Addl. CIT, Special Range-7, Room No. 211, C.R. Building, Delhi-110002. PAN- AACCP3920F Assessee Revenue Printed from counselvise.com MA Nos.- 408/Del/2025 & two other M.As. Corteva Agriscience Seeds Pvt. Ltd. 2 MA No.- 406/Del/2015 (Arising out of ITA No.- 9205/Del/2019) [Assessment Year: 2015-16] Corteva Agriscience Seeds Pvt. Ltd., {formerly known as PHI Seeds Limited) V-Ascends, Atria Block, 12th Floor, Plot No. 17, Software Units Layout, Madhapur, Hyderabad Telangana, 500081. Vs Addl. CIT, Special Range-7, Room No. 211, C.R. Building, Delhi-110002. PAN- AACCP3920F Assessee Revenue Assessee by Shri Aditya Vohra, Adv. & Ms. Aakriti Bansal, CA Revenue by Ms. Rajesh Kumar, CIT(DR) Date of Hearing 23.01.2026 Date of Pronouncement 26.02.2026 ORDER PER BRAJESH KUMAR SINGH, AM This bunch of three Miscellaneous Application (M.A.) filed by the assessee, pertain to Assessment Years (A.Y) 2013-14, 2014-15 and 2015-16, respectively. Since identical and similar issues are involved in all the M.As. they were heard together and are being disposed of by this common order for the sake of convenience and brevity. Printed from counselvise.com MA Nos.- 408/Del/2025 & two other M.As. Corteva Agriscience Seeds Pvt. Ltd. 3 2. The relevant contents in the M.A. (408/Del/2015) Arising out of ITA No.- 1575/Del/2018 for A.Y. 2013-14 filed by the assessee are reproduced as under: “Re: Miscellaneous ApplicaƟon under secƟon 254(2) of the Income-tax Act, 1961 (\"the Act\") It is respecƞully submiƩed as under Appeal filed by the Applicant for assessment year 2013-14 was decided by the Hon'ble Tribunal vide common order dated 06.08.2025 passed for assessment years 2013-14 to 2015-16. Certain mistakes apparent from record have inadvertently crept in the order of the Hon'ble Tribunal. recƟficaƟon of which is prayed for as under: The primary issue in the appeal, apart from transfer pricing adjustments, related to the exempƟon claimed by the Applicant in respect of income earned from sale of hybrid seeds. While the Applicant claimed the income to be exempt agricultural income in terms of secƟon 10(1) read with secƟon 2(1A) of the Act, the lower authoriƟes held the same to be taxable business income and accordingly, disallowed the claim of said exempƟon. The Applicant, during the course of hearing of the capƟoned maƩer, filed applicaƟon dated 26.07.2024 for admission of addiƟonal grounds of appeal. The addiƟonal grounds of appeal raised vide said applicaƟon read as follows: \"That on the facts and circumstances of the case and in lave, CIT(A) ought to have appreciated that since operaƟng margin of the appellant is higher than the working capital adjusted margin of the comparable companies, no adjustment on account of interest on receivables is warranted. 2. Without prejudice, that on the facts and circumstances of the case and in law, CIT(A) erred in not giving direcƟons to assess the total income of the Appellant as per normal provisions of Act by making necessary adjustment as per secƟons 28 to 43B of the Act\" The Appellant through the addiƟonal ground of appeal No 2 had contended that if the exempƟon under secƟon 10(1) read with secƟon 2(1A) with respect to income earned from sale of hybrid seeds is not to be allowed and the income is regarded as business income, then, the same needs to be computed in terms of provisions of secƟons 28 to 43B of the Act. The aforesaid addiƟonal ground was raised without prejudice and in the alternate, in the event that the claim for exempƟon under secƟon 10(1) read with secƟon 2(1A) of the Act with respect to income earned from sale of hybrid seeds was not to be accepted. Printed from counselvise.com MA Nos.- 408/Del/2025 & two other M.As. Corteva Agriscience Seeds Pvt. Ltd. 4 The assessee had accordingly contended at the Ɵme of hearing of the appeal that in case the principal issue, viz, exempƟon under secƟon 10(1) read with secƟon 2(1A) of the Act was to be decided against the assessee, appropriate direcƟons be issued to the assessing officer to compute business income in accordance with law The Hon'ble Tribunal vide order dated 06.08.2025 in para 14.9 confirmed the disallowance of agricultural income claimed exempt under secƟon 10(1) rw.s. 2(1A) of the Act. The aforesaid addiƟonal ground of appeal No. 2 raised by the Applicant regarding computaƟon of income of the Applicant under normal provisions of the Act. has been summarily rejected by this Hon’ble Tribunal holding as under 14.10. Further, regarding the addiƟonal ground filed by the assessee that the Ld. CIT(A) erred in not giving direcƟons to assess the total income of the assessee as per normal provisions of the Act by making necessary adjustments as per secƟon 28 to 43B of the Act filed vide leƩer dated 26. 07. 2024 in relaƟon to the above grounds is also dismissed as no submission were made in respect of this addiƟonal ground.” It needs to be appreciated that the computaƟon of business income under secƟons 28 to 43B has to necessarily follow a maƩer of course, consistent with the finding that the income earned from sale of hybrid seeds is not exempt under secƟon 10(1) read with secƟon 2(1A), the same does not require any elaborate arguments or reasoning The assessing officer had, therefore, necessarily to be directed to compute the income in terms of secƟons 28 to 43B, consistent with the finding recorded by the Hon'ble Tribunal that income earned from sale of hybrid seeds was taxable as business income and not exempt under secƟon 10(1) read with secƟon 2(1A) of the Act. It is respecƞully submiƩed that the order passed by the Hon'ble Tribunal dismissing addiƟonal ground of appeal No. 2 on the plea that no arguments were advanced by the Appellant/assessee, in the aforesaid background, consƟtutes mistake apparent from record falling within the scope of secƟon 254(2) of the Act, as held by the Hon'ble Supreme Court in the case of Honda Siel Power Products Ltd: 295 ITR 466 (SC) & Full Bench of the Delhi High Court in the case of Lachman Dass BhaƟa Hingwala (P) Ltd vs ACIT: 330 ITR 243 (Del) (FB) Prayer In light of the aforesaid, it is respecƞully prayed that the appellate order dated 06.08.2025 may kindly be amended/recƟfied by issuing corrigendum to the effect that the assessing officer would compute business income on sale of hybrid seeds in terms of provisions of secƟons 28 to 43B of the Act. Printed from counselvise.com MA Nos.- 408/Del/2025 & two other M.As. Corteva Agriscience Seeds Pvt. Ltd. 5 The Applicant trusts that its request shall be acceded to. An opportunity of being heard is prayed for.” (emphasis supplied by us) 3. At the time of hearing, the Ld. AR relied upon the aforesaid submissions made in the M.A. and requested that necessary direction may be given to the AO to compute the business income on sale of hybrid seeds in terms of provisions of sections 28 to 43B of the Act. 4. The Ld. CIT(DR) fairly submitted that request of the assessee was a natural corollary of our decision in upholding the findings of the AO in the assessment order rejecting the claim of the assessee of treating the income of Rs. 124,59,41,832/- on sale of hybrid seeds as exempt income u/s. 2(1A) r.w.s. 10(1) of the Act and treating it as business income. However, the Ld. CIT(DR) submitted that the assessee may be directed to approach the AO for necessary relief in terms of the findings of the Tribunal rather than filing this miscellaneous application. 5. We have heard both the parties and perused the material available on record. The above claim of the assessee was rejected by the AO / Ld. CIT(A) and also affirmed by our order dated 06.08.2025 by rejecting the ground no. 1 to 3 of the appeal. The concluding observation in our order is reproduced as under: “14.8 …….In view of the facts as discussed by us earlier in this order, we are of the considered view that the assessee has not carried out the basic operations of agricultural activity as per the tests laid in the judgment of the Hon'ble Supreme Court in the case of CIT VS. Raja Benoy Kumar Sahas Roy (Supra) and has thus has failed to Printed from counselvise.com MA Nos.- 408/Del/2025 & two other M.As. Corteva Agriscience Seeds Pvt. Ltd. 6 discharge the burden cast upon it that its case comes within the parameters for seeking exemption of Rs. 124,59,41,832/- as claimed u/s 2(1A) r.w.s. 10(1) of the Act. 14.9. Therefore, in view of the above facts and following the order dated 18.12.2017 of the Co-ordinate Bench in the case of the assessee, we confirm the order of the Ld. CIT(A) in confirming the disallowance of agricultural income amounting to Rs. 124,59,41,832/ claimed u/s 2(1A) r.w.s. 10(1) of the Act and treating it a business income by the AO. Ground nos.1 to 3 of the appeal are dismissed.” 5.1 Further, in this regard, the assessee had filed without prejudice additional ground no. 2 as under: “2. Without prejudice, that on the facts and circumstances of the case and in law, CIT(A) erred in not giving direcƟons to assess the total income of the Appellant as per normal provisions of Act by making necessary adjustment as per secƟons 28 to 43B of the Act\" 5.2 The same was rejected in our order as under: “14.10. Further, regarding the addiƟonal ground filed by the assessee that the Ld. CIT(A) erred in not giving direcƟons to assess the total income of the assessee as per normal provisions of the Act by making necessary adjustments as per secƟon 28 to 43B of the Act filed vide leƩer dated 26. 07. 2024 in relaƟon to the above grounds is also dismissed as no submission were mode in respect of this addiƟonal ground.” 5.3 In the above background, we are of the view that the plea of the assessee in its Miscellaneous Application that the appellate order dated 06.08.2025 may be amended/rectified by issuing corrigendum to the effect that the assessing officer would compute business income on sale of hybrid seeds in terms of provisions of sections 28 to 43B of the Act for is justified. Therefore, by dismissing the aforesaid Printed from counselvise.com MA Nos.- 408/Del/2025 & two other M.As. Corteva Agriscience Seeds Pvt. Ltd. 7 additional ground no. 2 of the assessee as reproduced above, a mistake apparent from record has crept in our common order dated 06.08.2025 in ITA Nos. 1575/Del/2018, 7375/Del/2018 and 9205/Del/2019. We, therefore, recall our order to that extent and direct the AO to compute the business income of Rs. 124, 59,41,832/- in terms of provisions of section 28 to 43B of the Act. Accordingly, the without prejudice additional ground no. 2 of the appeal dismissed by our order dated 06.08.2025 in ITA Nos. 1575/Del/2018 is recalled and is allowed as above. 6. In above terms, the Miscellaneous Application (M.A. No.- 408/Del/2015) of the assessee is allowed. 7. The facts stated in the M.A. No. 407/Del/2015 and 406/Del/2015 by the assessee are identical except for the fact that the additional ground no. 2 in ITA No. 7375/Del/2018 and 9205/Del/2019 for A.Y. 2014-15 and 2015-16 was not adjudicated in our common order dated 06.08.2025, which upon verification has been found to be correct by us. Therefore, we recall our own order dated 06.08.2025 in ITA No. 7375/Del/2018 and ITA No. 9205/Del/2019 for A.Ys. 2014-15 and 2015- 16 and allow the said without prejudice additional ground no. 2 of the appeal by directing the AO to compute the business income of Rs. 127,91,52,057/- and Rs. 211,01,71,256/- for A.Y. 2014-15 and A.Y. 2015-16 in terms provisions of section 28 to 43B of the Act. Printed from counselvise.com MA Nos.- 408/Del/2025 & two other M.As. Corteva Agriscience Seeds Pvt. Ltd. 8 7.1 Accordingly, both the MA of the assessee are allowed to the above extent. 8. In the result, all the three miscellaneous applications of the assessee are allowed. Order pronounced in the open court on 26th February, 2026. Sd/- Sd/- [VIKAS AWASTHY] [BRAJESH KUMAR SINGH] JUDICIAL MEMBER ACCOUNTANT MEMBER Dated 26.02.2026. Pooja Copy forwarded to: 1. Assessee 2. Respondent 3. PCIT 4. CIT(A) 5. DR Asst. Registrar, ITAT, New Delhi, Printed from counselvise.com "