BAJAJ HOLDINGS & INVESTMENT LTD, MUMBAI V. ASST CIT (LTU) 1, MUMBAI

ITA 4077/MUM/2016

• Counselvise Citation: [2021] 107 COUNSELVISE.COM (IT) 8295 (ITAT-MUMBAI)
• Duration Of Justice: 5 year(s) 1 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-08-2021
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: J
• Assessment Year: 2011-2012
• Appeal Filed On: 14-06-2016
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Keywords: Earning of tax free income; Rule 8D; Capital Gains
• Section: 14A; 201; 13; 22

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL , B BENCH MUMBAI BEFORE : SHRI VIKAS AWASTHY, JUDICIAL MEMBER & SHRI M.BALAGANESH, A CCOUNTANT MEMBER ITA NO. 4077/ MUM/ 20 16 ( ASSESSMENT YEAR : 2011 - 12 ) ITA NO. 4078/ MUM/ 2016 ( ASSESSMENT YEAR : 2010 - 11 ) & ITA NO. 2603/ MUM/ 2017 ( ASSESSMENT YEAR : 2012 - 13 ) M/S. BAJAJ HOLDINGS & INVESTMENT LIMITED 2 ND FLOOR, BAJAJ BHAWAN 226, JAMNALAL BAJAJ MARG NARIMAN POINT MUMBAI 400 021 VS. THE ASSISTANT COMMISSIONER OF INCOME TAX (LARGE TAXPAYER UNIT) - 1(FORMERLY A SSESSED BY THE DEPUTY COMMISSIONER OF INCOME - TAX (LARGE TAXPAYER UNIT) MUMBAI PAN/GIR NO. AAACB3370K (APPELLANT ) .. (RESPONDENT ) ASSESSEE BY SHRI PERCY PARDIWALA & MS. V ASANTI PA T EL REVENUE BY SHRI THARIAN OOMMEN DATE OF HEARING 0 2 /0 8 /2021 DATE OF PRONOUNCEMENT 12 / 08 /202 1 / O R D E R PER M. BALAGANESH (A.M) : ITA NO.4077/MUM/2016 (A.Y.2011 - 12) THIS APPEAL IN ITA NO. 4077/MUM/2016 FOR A.Y. 2011 - 12 ARISES OUT OF THE ORDER BY THE LD. COMMISSIONER OF INCOME TAX (APPEALS) - 1, MUMBAI ITA NO . 4077/MUM/2016 AND OTHER APPEALS M/S. BAJAJ HOLDINGS & INVESTMENT LTD., 2 IN APPEAL NO. CIT(A) - I/LTU/DCIT - LTU/26/2 014 - 15 DATED 30/03/2016 (LD. CIT(A) IN SHORT) AGAINST THE ORDER OF ASSESSMENT PASSED U/S.143(3) OF THE INCOME TAX ACT, 1961 (HEREINAFTER REFERRED TO AS ACT) DATED 31/03/2014 BY THE LD. DY. COMMISSIONER OF INCOME TAX - LTU, MUMBAI (HEREINAFTER REFERRED TO AS LD. AO). ITA NO.4078 /MUM/2016 (A.Y.2010 - 11) THIS APPEAL IN ITA NO. 4 078 /MUM/2016 FOR A.Y. 201 0 - 1 1 ARISES OUT OF THE ORDER BY THE LD. COMMISSIONER OF INCOME TAX (APPEALS) - 1, MUMBAI IN APPEAL NO. C IT(A) - I/LTU/A CIT - LTU/2 4 /201 3 - 1 4 DATED 29 /03/2016 (LD. CIT(A) IN SHORT) AGAINST THE ORDER OF ASSESSMENT PASSED U/S.143(3) OF THE INCOME TAX ACT, 1961 (HEREINAFTER REFERRED TO AS ACT) DATED 25/03/2013 BY THE LD. ASST . COMMISSIONER OF INCOME TAX - LTU, MUMBAI (HEREINAFTER REFERRED TO AS LD. AO). ITA NO.2603 /MUM/201 7 (A .Y.2012 - 13) THIS APPEAL IN ITA NO. 2603/MUM/2017 FOR A.Y. 2012 - 13 ARISES OUT OF THE ORDER BY THE LD. COMMISSIONER OF INCOME TAX (APPEALS) - 1, MUMBAI IN APPEAL NO. CIT(A) - I/LTU/DCIT - LTU/15/2015 - 16 DATED 02/12/2016 (LD. CIT(A) IN SHORT) AGAINST THE ORDER OF A SSESSMENT PASSED U/S.143(3) OF THE INCOME TAX ACT, 1961 (HEREINAFTER REFERRED TO AS ACT) DATED 10 / 03/2015 BY THE LD. ASST. COMMISSIONER OF INCOME TAX - LTU, MUMBAI (HEREINAFTER REFERRED TO AS LD. AO). AS IDENTICAL ISSUES ARE INVOLVED IN ALL THESE APPEALS, THEY ARE TAKEN UP TOGETHER AND DISPOSED OF BY THIS COMMON ORDER FOR THE SAKE OF CONVENIENCE. ITA NO . 4077/MUM/2016 AND OTHER APPEALS M/S. BAJAJ HOLDINGS & INVESTMENT LTD., 3 ITA NO.4078/MUM/2016 (A.Y.2010 - 11) 2. THE FIRST ISSUE TO BE DECIDED IN THIS APPEAL IS WITH REGARD TO THE DISALLOWANCE MADE U/S.14A OF THE ACT READ WITH RULE 8D(2) OF THE RULES. THE ASSESSEE HAS RAISED THE GROUND NOS. 1 - 16 IN THIS REGARD. 3. WE HAVE HEARD RIVAL SUBMISSIONS AND PERUSED THE MATERIALS AVAILABLE ON RECORD. WE FIND THAT ASSESSEE IS A NON - BANKING FINANCE COMPANY PRIMARILY ENGAGED IN THE BUSINESS OF MAKIN G INVESTMENTS IN VARIOUS COMPANIES WITH FOCUS ON NEW BUSINESS OPPORTUNITIES. WE FIND THAT ASSESSEE HAD EARNED DIVIDEND INCOME FROM DOMESTIC COMPANIES AMOUNTING TO RS.140,81,65,689/ - AND CLAIMED THE SAME AS EXEMPT U/S.10(34) OF THE ACT. THE ASSESSEE MADE VO LUNTARILY DISALLOWANCE OF RS.83,96,478/ - U/S.14A ON ACCOUNT OF EXPENDITURE INCURRED FOR THE PURPOSE OF EARNING EXEMPT INCOME. THE ASSESSEE ALSO FURNISHED THE WORKINGS AND THE BASIS FOR DISALLOWANCE MADE BY IT IN THE RETURN OF INCOME AS UNDER: - PARTICULARS AMOUNT (RS.) TOTAL EXPENDITURE 62,784,870 LESS: DISALLOWED IN THE COMPUTATION 7,871,006 LESS: RECOVERY FOR BUSINESS SUPPORT SERVICES 9,864,000 BALANCE EXPENDITURE 45,049,864 ADD: EXPENDITURE PAID BY BAL ON BEHALF OF BHIL 3,397,019 TOTAL EXPENDITURE CONSIDERED FOR DISALLOWANCE UNDER SECTION 14A OF THE ACT (A) 48,446,883 TOTAL INCOME 8,134,846,750 LESS: RECOVERY FOR BUSINESS SUPPORT SERVICES 9,864,000 REVISED TOTAL INCOME (C) 8,124,982,750 EXEMPT INCOME (B) 1,408,165,689 DISALLOWANCE UNDER SECTION 14A OF THE ACT (A*B/C) 8,396,478 BAL STANDS FOR BAJAJ AUTO LTD., BHIL STANDS FOR BAJAJ HOLDINGS AND INVESTMENTS LTD., (I.E. ASSESSEE HEREIN) ITA NO . 4077/MUM/2016 AND OTHER APPEALS M/S. BAJAJ HOLDINGS & INVESTMENT LTD., 4 3.1. THE LD. AO IGNORING THE AFORESAID WORKINGS OF THE ASSESSEE DIRECTLY PROCEEDED TO MAKE DISALLOWANCE U/S.14A OF THE ACT BY APPLYING COMPUTATION MECHANISM PROVIDED IN RULE 8D(2)(III) OF THE RULES AMOUNTING TO RS.11,17,55,415/ - . THE ASSESSEE PLEADED THAT IT , BEING AN INVESTMENT COMPANY, IS BOUND TO MAKE HUGE INVESTMENTS IN VARIOUS COMPANIES. THE ASSESSEE ALSO PLEAD ED THAT THE COMPUTATION MECHANISM PROVIDED IN RULE 8D(2) OF THE RULES WOULD RESULT IN ABSURDITY AS IT WOULD APPARENTLY EXCEED THE TOTAL EXPENDITURE CLAIMED BY THE ASSESSEE IN THE RETURN OF INCOME ITSELF. THE LD. AO HOWEVER, DISREGARDED ALL THESE CONTENTION S OF THE ASSESSEE AND DIRECTLY APPLIED COMPUTATION MECHANISM PROVIDED IN RULE 8D(2)(III) OF THE RULES AND ARRIVED AT THE DISALLOWANCE FIGURE OF RS.11,17,55,415/ - . HOWEVER, CONSIDERING THE FACT THAT ASSESSEE HAD EFFECTIVELY CLAIMED ONLY A SUM OF RS.3,39,22, 376/ - AS DEDUCTION IN THE RETURN OF INCOME, HE RESTRICTED THE DISALLOWANCE U/S.14A OF THE ACT TO THE EXTENT OF RS.3,39,22,376/ - . IN EFFECT APART FROM VOLUNTARILY DISALLOWANCE OF VARIOUS EXPENSES MADE BY THE ASSESSEE IN THE RETURN OF INCOME, THE LD. AO DISA LLOWED THE REMAINING EXPENSES OF RS.3,39,22,376/ - U/S.14A OF THE ACT. BY THIS PROCESS, NO EXPENDITURE WAS ALLOWED AS DEDUCTION BY THE LD. AO FOR THE PURPOSE OF EARNING TAXABLE INCOME. THE LD. AO PROCEEDED TO MAKE DISALLOWANCE OF THE SAID EXPENDITURE U/S.14 A BOTH UNDER NORMAL PROVISIONS OF THE ACT AS WELL AS IN THE COMPUTATION OF BOOK PROFITS U/S.115JB OF THE ACT. THIS ACTION OF THE LD. AO WAS UPHELD BY THE LD. CIT(A). 3.2. AT THE OUTSET, WE FIND THAT THERE WAS ABSOLUTELY NO SATISFACTION RECORDED BY THE LD. AO IN HIS ASSESSMENT ORDER AS TO HOW THE VOLUNTARY DISALLOWANCE MADE BY THE ASSESSEE IS INCORRECT HAVING REGARD TO THE CORRECTNESS OF THE ACCOUNTS OF THE ASSESSEE. SUCH SATISFACTION IS MANDATED TO BE RECORDED IN TERMS OF SECTION 14A(2) READ WITH RULE 8D(1 ) ITA NO . 4077/MUM/2016 AND OTHER APPEALS M/S. BAJAJ HOLDINGS & INVESTMENT LTD., 5 OF THE RULES. NON - RECORDING OF SUCH MANDATORY SATISFACTION ON AN OBJECTIVE BASIS WITH COGENT REASONS WOULD MAKE THE ENTIRE ADDITION ILLEGAL. RELIANCE IN THIS REGARD IS PLACED ON THE DECISION OF THE HONBLE APEX COURT IN THE CASE OF MAXOOP INVESTMENTS REP ORTED IN 402 ITR 640. SINCE, THE DISALLOWANCE MADE U/S.14A OF THE ACT BY THE LD. AO IS HEREBY DIRECTED TO BE DELETED ON THE AFORESAID TECHNICAL ASPECT, THE OTHER ELABORATE ARGUMENTS ADVANCED BY THE LD. AR BY MAKING VARIOUS PROPOSITIONS NEED NOT BE GONE INT O , AS ADJUDICATION OF THE SAME WOULD BE MERELY ACADEMIC IN NATURE. ACCORDINGLY, THE GROUNDS RAISED WITH REGARD TO DISALLOWANCE MADE U/S.14A OF THE ACT BOTH UNDER NORMAL PROVISIONS OF THE ACT AS WELL AS IN THE COMPUTATION OF BOOK PROFITS U/S.115JB OF THE AC T ARE HEREBY ALLOWED. THE LD. AO IS DIRECTED TO DELETE THE ENTIRE DISALLOWANCE MADE U/S.14A OF THE ACT AND RE TAIN THE VOLUNTARY DISALLOWANCE OF RS.83,96,478/ - U/S.14A OF THE ACT BOTH UNDER NORMAL PROVISIONS AS WELL AS IN THE COMPUTATION OF BOOK PROFITS U/S .115JB OF THE ACT. 4. THE NEXT ISSUE TO BE DECIDED IN THIS APPEAL IS AS TO WHETHER THE LD. CIT(A) WAS JUSTIFIED IN UPHOLDING THE DISALLOWANCE OF LOSS IN CONNECTION WITH BONDS / DEBENTURES WRITTEN OFF AMOUNTING TO RS.10,02,61,073/ - IN THE FACTS AND CIRCUMSTA NCES OF THE INSTANT CASE. 5. WE HAVE HEARD RIVAL SUBMISSIONS AND PERUSED THE MATERIALS AVAILABLE ON RECORD. WE FIND THAT ASSESSEE HAD MADE INVESTMENTS IN T HE FOLLOWING DEBENTURES / BONDS: - DEBENTURES / BONDS QTY. VALUE ASHI MA LTD 500,000 16,833,095 GOODEARTH ORGANI CS LTD 100,000 9,500,000 HINDUSTAN DEVELOPMENT CORP 375,850 13,694,078 ITA NO . 4077/MUM/2016 AND OTHER APPEALS M/S. BAJAJ HOLDINGS & INVESTMENT LTD., 6 HINDUSTAN DEVELOPMENT CORP 20,958 763,787 MAHADEO INDUSTRIES LTD 690 2,501,250 PUNJAB WIRELESS SYSTEMS LTD 2 20,382,000 PUNJAB WIRELESS SYSTEMS LTD 300,000 3 0,000,000 RAJINDER PIPES LTD., 4,930 442,172 SHAAN INTERWELL (INDIA) LTD., 100,000 6,138,972 TORRENT GUJARAT BIO - TECH LTD., 100 5,719 TOTAL 100,261,073 5.1. THE LD. AO NOTED THAT DURING THE YEAR UNDER CONSIDERATION, THE ASSESSEE HAS CLAIMED DEDUCTION OF RS.24,29,02,928/ - ON ACCOUNT OF WRITE OFF OF INVESTMENTS. FROM THE PERUSAL OF PAGE NO.18 OF THE PAPER BOOK UNDER S CHEDULE 8 - OTHER EXPENSES, WE FIND THAT ASSESSEE HAD ALREADY MADE PROVISION FOR INVESTMENT TO THE TUNE OF RS.242.9 MILLION (I .E. RS.24,29,02,928 AS STATED ABOVE) IN EARLIER YEARS AND THAT THE SAID PROVISION HAS BEEN DULY WRITTEN OFF IN THE BOOKS OF ACCOUNTS OF THE ASSESSEE DURING THE YEAR UNDER CONSIDERATION. THE LD. AR POINTED OUT THAT AT THE TIME OF MAKING PROVISION FOR INVEST MENTS, THE SAME WERE DULY DISALLOWED BY THE ASSESSEE IN THE RETURN OF INCOME. HE ARGUED THAT SINCE THE INVESTMENTS MADE BY THE ASSESSEE COULD NOT BE RECOVERED, THE ASSESSEE COMPANY CHOSE TO WRITE OFF THE SAME IN ITS BOOKS OF ACCOUNTS AND ACCORDINGLY , CLAIM ED THE SAME AS DEDUCTION U/S. 36(1)(VII) OF THE ACT AS ADMITTEDLY THE ASSESSEE COMPANY IS ENGAGED IN THE BUSINESS OF FINANCING AND BEING THE INVESTMENT COMPANY, THE SAID INVESTMENTS WERE MADE BY THE ASSESSEE IN THE ORDINARY COURSE OF ITS BUSINESS WHICH HAD BECOME BAD AND ACCORDINGLY, THE ASSESSEE WAS FORCED TO WRITE OFF THE SAME AND CLAIM AS DEDUCTION U/S.36(1)(VII) OF THE ACT. WE FIND CONSIDERABLE FORCE IN THIS ARGUMENT OF THE LD. AR AND ALSO CONSIDERING THE ITA NO . 4077/MUM/2016 AND OTHER APPEALS M/S. BAJAJ HOLDINGS & INVESTMENT LTD., 7 FACT THAT THE DEBENTURE INTEREST INCOME EARNED B Y THE ASSESSEE IN THE EARLIER YEARS HAD BEEN DULY OFFERED TO TAX UNDER THE HEAD INCOME FROM BUSINESS AND ASSESSED AS SUCH, WE HOLD THAT THE LOSS BY WAY OF WRITE OFF OF INVESTMENTS WHICH IS ARISING IN THE ORDINARY COURSE OF BUSINESS OF MONEY LENDING BECOM ES ALLOWABLE DEDUCTION U/S.36(1) ( VII) OF THE ACT. ACCORDINGLY, WE HOLD THAT ASSESSEE WOULD BE ENTITLED FOR DEDUCTION IN RESPECT OF DEBENTURES / BONDS WRITTEN OFF IN THE SUM OF RS.1 0 ,02,61,073/ - U/S.36(1)(VII) OF THE ACT. THE GROUNDS RAISED BY THE ASSESSEE IN THIS REGARD ARE HEREBY ALLOWED. 6. THE GROUND NOS.20 - 22 RAISED BY THE ASSESSEE WAS STATED TO BE NOT PRESSED BY THE LD. AR AT THE TIME OF HEARING BY CONCEDING THAT ASSESSEE COMPANY IS NOT ENTITLED FOR DEDUCTION THEREON. ACCORDINGLY, GROUND NOS.20 - 22 ARE HEREBY DISMISSED. 7. THE ASSESSEE HAD RAISED ADDITIONAL GROUND CHALLENGING THE DISALLOWANCE OF RS.1,91,883/ - BEING WRITE OFF IN RESPECT OF PROPORTIONATE PREMIUM PAID ON LEASE HOLD LAND. THIS ADDITIONAL GROUND WAS STATED TO BE NOT PRESSED BY THE LD. AR AT THE TIME OF HEARING AND ACCORDINGLY, THE SAME IS HEREBY DISMISSED AS UNADMITTED AND NOT PRESSED. 8. THE ASSESSEE HAD RAISED ANOTHER ADDITIONAL GROUND SEEKING REFUND OF DIVIDEND DISTRIBUTION TAX PAID U/S. 115O OF THE ACT IN RESPECT OF DIVIDEND PAID TO NON - RESIDENT SHAREHOLDERS TO THE EXTENT OF SUCH TAX EXCEEDS THE RATES PRESCRIBED UNDER THE RELEVANT TAX TREATIES. THIS ADDITIONAL GROUND WAS ALSO STATED TO BE NOT PRESSED BY THE LD. AR AT THE TIME OF HEARING AND ACCORDINGLY, THE SAME IS HEREBY DISMISSED AS UN ADMITTED AND NOT PRESSED. ITA NO . 4077/MUM/2016 AND OTHER APPEALS M/S. BAJAJ HOLDINGS & INVESTMENT LTD., 8 9. WE FIND THAT ASSESSEE HAD RAISED YET ANOTHER ADDITIONAL GROUND VIDE LETTER DATED 04/10/2018 SEEKING DEDUCTION FOR EDUCATION CESS ON INCOME TAX PAID DURING THE YEAR. 10. WE HAVE HEARD RIVAL SUBMISSIONS AND PERUSED THE MATERIA LS AVAILABLE ON RECORD. WE FIND THAT THIS ADDITIONAL GROUND RAISED BY THE ASSESSEE IS PURELY A LEGAL ISSUE AND DOES NOT INVOLVE VERIFICATION OF ANY FACTS AND HENCE, WE DEEM IT FIT TO ADMIT THE SAME AND TAKE UP FOR ADJUDICATION. WE FIND THAT THIS ISSUE IS N O LONGER RES - INTEGRA IN VIEW OF THE DECISION OF THE HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF SESA GOA LTD., VS. JCIT REPORTED IN 423 ITR 426 WHEREIN THE HONBLE BOMBAY HIGH COURT HELD FOR EDUCATION CESS, HIGHER AND SECONDARY EDUCATION CESS ARE LIAB LE FOR DEDUCTI ON IN COMPUTING INCOME CHARGEABLE UNDER THE HEAD PROFITS AND GAINS OF BUSINESS OR PROFESSION. ACCORDINGLY, THE ADDITIONAL GROUND RAISED BY THE ASSESSEE IN THIS REGARD VIDE LETTER DATED 04/10/2018 IS HEREBY ALLOWED. 11. IN THE RESU LT, APPEAL OF THE ASSESSEE IN ITA NO.4078/MUM/2016 FOR A.Y.2010 - 11 IS PARTLY ALLOWED. ITA NO.4077/MUM/2016 (A.Y.2011 - 12) 12. GROUND NOS. 1 - 16 RAISED BY THE ASSESSEE IS CHALLENGING THE DISALLOWANCE MADE U/S.14A OF THE ACT . IN VIEW OF I DENTICAL FACTS WITH THAT OF A.Y.2010 - 11 ON THIS ISSUE, WHICH IS NOT DISPUTED BY THE REVENUE BEFORE US, THE DECISION RENDERED BY US FOR A.Y.2010 - 11 WOULD APPLY WITH EQUAL FORCE FOR A.Y.2011 - 12 ALSO EXCEPT WITH VARIANCE IN FIGURES. ACCORDINGLY, THE GROUND NOS. 1 - 16 RAISED BY T HE ASSESSEE ARE ALLOWED. ITA NO . 4077/MUM/2016 AND OTHER APPEALS M/S. BAJAJ HOLDINGS & INVESTMENT LTD., 9 13. THE ASSESSEE HAD RAISED ADDITIONAL GROUND CHALLENGING THE DISALLOWANCE OF RS.1,91,883/ - BEING WRITE OFF IN RESPECT OF PROPORTIONATE PREMIUM PAID ON LEASE HOLD LAND. THIS ADDITIONAL GROUND WAS STATED TO BE NOT PRESSED BY THE LD . AR AT THE TIME OF HEARING AND ACCORDINGLY, THE SAME IS HEREBY DISMISSED AS UNADMITTED AND NOT PRESSED. 14. WE FIND THAT ASSESSEE HAD RAISED YET ANOTHER ADDITIONAL GROUND VIDE LETTER DATED 04/10/2018 SEEKING DEDUCTION FOR EDUCATION CESS ON INCOME TAX PAI D DURING THE YEAR. 15. WE HAVE HEARD RIVAL SUBMISSIONS AND PERUSED THE MATERIALS AVAILABLE ON RECORD. WE FIND THAT THIS ADDITIONAL GROUND RAISED BY THE ASSESSEE IS PURELY A LEGAL ISSUE AND DOES NOT INVOLVE VERIFICATION OF ANY FACTS AND HENCE, WE DEEM IT F IT TO ADMIT THE SAME AND TAKE UP FOR ADJUDICATION. WE FIND THAT THIS ISSUE IS NO LONGER RES - INTEGRA IN VIEW OF THE DECISION OF THE HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF SESA GOA LTD., VS. JCIT REPORTED IN 423 ITR 426 WHEREIN THE HONBLE BOMBAY H IGH COURT HELD THAT EDUCATION CESS, HIGHER AND SECONDARY EDUCATION CESS ARE LIABLE FOR DEDUCTI ON IN COMPUTING INCOME CHARGEABLE UNDER THE HEAD PROFITS AND GAINS OF BUSINESS OR PROFESSION. ACCORDINGLY, THE ADDITIONAL GROUND RAISED BY THE ASSESS EE IN THIS REGARD VIDE LETTER DATED 04/10/2018 IS HEREBY ALLOWED. 16. IN THE RESULT, APPEAL OF THE ASSESSEE IN ITA NO.4077/MUM/2016 FOR A.Y.2011 - 12 IS PARTLY ALLOWED. ITA NO.2603/MUM/2017 (A.Y.2012 - 13) 17. GROUND NOS. 1 - 9 RAISED BY THE ASSESSEE IS CHALLE NGING THE DISALLOWANCE MADE U/S.14A OF THE ACT. IN VIEW OF IDENTICAL FACTS WITH THAT ITA NO . 4077/MUM/2016 AND OTHER APPEALS M/S. BAJAJ HOLDINGS & INVESTMENT LTD., 10 OF A.Y.2010 - 11 ON THIS ISSUE, WHICH IS NOT DISPUTED BY THE REVENUE BEFORE US, THE DECISION RENDERED BY US FOR A.Y.2010 - 11 WOULD APPLY WITH EQUAL FORCE FOR A.Y.2012 - 13 ALSO EXCEPT WITH VARIANCE IN FIGURES. ACCORDINGLY, THE GROUND NOS. 1 - 9 RAISED BY THE ASSESSEE ARE ALLOWED. 18. THE GROUND NOS. 10 & 11 RAISED BY THE ASSESSEE IS WITH REGARD TO NON - GRANTING OF SET OFF IN RESPECT OF SHORT TERM CAPITAL LOSS OF RS.1,91,827/ - . 19 . WE HAVE HEARD RIVAL SUBMISSIONS AND PERUSED THE MATERIALS AVAILABLE ON RECORD. WE FIND FROM PAGE 20 OF THE PAPER BOOK FILED BY THE ASSESSEE WHICH CONTAINS THE STATEMENT OF COMPUTATION OF TOTAL INCOME, WHEREIN ASSESSEE HAD RETURNED INCOME FROM CAPITAL GAI NS AS UNDER: - III. CAPITAL GAINS (A) LONG TERM CAPITAL GAINS (AS PER STATEMENT ANNEXED) - 22,69,12,345 (B) SHORT TERM CAPITAL GAINS (15%) (AS PER STATEMENT ANNEXED) 3,71,93,779 (C) SHORT TERM CAPITAL GAINS (OTHERS)(AS PER STATEMENT ANNEXED) 1,21,73,95, 961 (D) DEEMED SHORT TERM CAPITAL GAINS - 1,91,827 1,25,43,97,513 20. FROM THE ABOVE, IT COULD BE SEEN THAT ASSESSEE HAD INCURRED DEEMED SHORT TERM CAPITAL LOSS OF RS.1,91,827/ - WHICH HAS BEEN SOUGHT TO BE SET OFF WITH OTHER SHORT TERM CAPITAL GAINS DER IVED BY THE ASSESSEE. BUT WE FIND THAT LD. AO WHILE COMPLETING THE ASSESSMENT HAD CONSIDERED ONLY LONG TERM CAPITAL LOSS OF RS.22,69,12,345/ - ; SHORT TERM CAPITAL GAINS TAXABLE @15% AMOUNTING TO RS.3,71,93,779/ - AND OTHER SHORT TERM ITA NO . 4077/MUM/2016 AND OTHER APPEALS M/S. BAJAJ HOLDINGS & INVESTMENT LTD., 11 CAPITAL GAINS AMOUNTING TO RS.121,73,95,561/ - . WE FIND THAT THE LD. AO HAD COMPLETELY IGNORED THE DEEMED SHORT TERM CAPITAL LOSS OF RS.1,91,827/ - WHICH HAS BEEN RETURNED BY THE ASSESSEE. WHEN THIS GROUND WAS RAISED BY THE A SSESSEE BEFORE THE LD. CIT(A) , WE FIND THAT THE LD. CIT(A ) IN PARA 6 OF HIS ORDER HAD MERELY DISMISSED THE CLAIM OF THE ASSESSEE ON THE GROUND THAT THE SAME DOES NOT ARISE FROM THE ORDER OF THE LD. AO. ADMITTEDLY, ASSESSEE HAD INDEED DISCLOSED DEEMED SHORT TERM CAPITAL LOSS OF RS.1,91,827/ - IN THE RETURN OF INCO ME. IT IS THE DUTY OF THE LD. AO TO LOOK INTO THE SAME AND CHECK THE ELIGIBILITY OF SET OFF OF THE SAME WITH OTHER SHORT TERM CAPITAL GAINS. THIS HAS ADMITTEDLY NOT BEEN DONE BY THE LD. AO IN THE INSTANT CASE. HENCE, WE DEEM IT FIT AND APPROPRIATE TO REMAN D THIS ISSUE TO THE FILE OF THE LD. AO FOR DENOVO ADJUDICATION OF THE SAID ISSUE RAISED IN GROUND NOS. 10 & 11 OF THE ASSESSEE. ACCORDINGLY, THE GROUND NOS. 10 & 11 ARE ALLOWED FOR STATISTICAL PURPOSES. 21. THE ASSESSEE HAD RAISED ANOTHER ADDITIONAL GROU ND SEEKING REVISION OF DIVIDEND DISTRIBUTION TAX PAID U/S. 115O OF THE ACT IN RESPECT OF DIVIDEND PAID TO NON - RESIDENT SHAREHOLDERS TO THE EXTENT OF SUCH TAX EXCEEDS THE RATES PRESCRIBED UNDER THE RELEVANT TAX TREATIES. THIS ADDITIONAL GROUND WAS STATED TO BE NOT PRESSED BY THE LD. AR AT THE TIME OF HEARING AND ACCORDINGLY, THE SAME IS HEREBY DISMISSED AS UNADMITTED AND NOT PRESSED. 22. WE FIND THAT ASSESSEE HAD RAISED YET ANOTHER ADDITIONAL GROUND VIDE LETTER DATED 04/10/2018 SEEKING DEDUCTION FOR EDUCAT ION CESS ON INCOME TAX PAID DURING THE YEAR. ITA NO . 4077/MUM/2016 AND OTHER APPEALS M/S. BAJAJ HOLDINGS & INVESTMENT LTD., 12 23. WE HAVE HEARD RIVAL SUBMISSIONS AND PERUSED THE MATERIALS AVAILABLE ON RECORD. WE FIND THAT THIS ADDITIONAL GROUND RAISED BY THE ASSESSEE IS PURELY A LEGAL ISSUE AND DOES NOT INVOLVE VERIFICATION OF ANY FAC TS AND HENCE, WE DEEM IT FIT TO ADMIT THE SAME AND TAKE UP FOR ADJUDICATION. WE FIND THAT THIS ISSUE IS NO LONGER RES - INTEGRA IN VIEW OF THE DECISION OF THE HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF SESA GOA LTD., VS. JCIT REPORTED IN 423 ITR 426 WH EREIN THE HONBLE BOMBAY HIGH COURT HELD FOR EDUCATION CESS, HIGHER AND SECONDARY EDUCATION CESS ARE LIABLE FOR DEDUCTI ON IN COMPUTING INCOME CHARGEABLE UNDER THE HEAD PROFITS AND GAINS OF BUSINESS OR PROFESSION. ACCORDINGLY, THE ADDITIONAL GROUND RAISE D BY THE ASSESSEE IN THIS REGARD VIDE LETTER DATED 04/10/2018 IS HEREBY ALLOWED. 2 4. IN THE RESULT, APPEAL OF THE ASSESSEE IN ITA NO.2603/MUM/2017 IS PARTLY ALLOWED. 25. IN THE RESULT, ALL THE APPEALS OF THE ASSESSEE ARE PARTLY ALLOWED. ORDER PRONOUNCE D ON 12 / 08 /202 1 BY WAY OF PROPER MENTIONING IN THE NOTICE BOARD. SD/ - ( VIKAS AWASTHY ) SD/ - (M.BALAGANESH) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI ; DATED 12 / 08 / 2021 KARUNA , SR.PS ITA NO . 4077/MUM/2016 AND OTHER APPEALS M/S. BAJAJ HOLDINGS & INVESTMENT LTD., 13 C OPY OF THE ORDER FORWARDED TO : BY ORDER, ( ASSTT. REGISTRAR) ITAT, MUMBAI 1. THE APPELLANT 2. THE RESPONDENT. 3. THE CIT(A), MUMBAI. 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE. //TRUE COPY//