AVENDUS CAPITAL P.LTD, MUMBAI V. ASST CIT 10(1), MUMBAI

ITA 4542/MUM/2013

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 93005 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-06-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 13-04-2015
• Assessment Year: 2009-2010
• Appeal Filed On: 07-06-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ASGHAR ZAIN
• Keywords: Revenue expenditure; Capital expenditure
• Section: 37(1)

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, MUMBAI . . , , BEFORE SHRI I.P. BANSAL, JUDICIAL MEMBER AND SHRI N.K . BILLAIYA, A CCOUNTANT M EMBER / I .T.A. NO . 4542 /MUM/ 2013 ( / ASSESSMENT YEAR : 2009 - 10 M/S. AVENDUS CAPITAL PVT. LTD., IL&FS FINANCIAL CENTER, 5 TH FLOOR, B - QUADRANT, BANDRA - KURLA COMPLEX, MUMBAI - 400 051 / VS. THE ACIT, RANGE - 10(1) MUMBAI - 400 020 ./ ./ PAN/GIR NO. : AABCC 2404Q ( / APPELLANT ) .. ( / RESPONDENT ) / APPELLANT BY: SHRI SANJAY SANGHVI SHRI ASHISH MEHTA / RESPONDENT BY : SHRI ASGHAR ZAIN / DATE OF HEARING : 2 4 . 0 6 .2015 / DATE OF PRONOUNCEMENT : 2 4 .0 6 .2015 / O R D E R PER N.K. BILLAIYA, AM: THIS APPEAL BY THE ASSESSEE IS PREFERRED AGAINST THE ORDER OF THE LD. CIT(A) - 2 1, MUMBAI DT. 11.3.2013 PERTAINING TO ASSESSMENT YEAR 2009 - 10. 2. THE ASSESSEE HAS RAISED TWO SUBSTANTIVE GROUNDS OF APPEAL. AT THE VERY OUTSET, THE LD. COUNSEL FOR THE ASSESSEE STATED THAT HE IS NOT PRESSING GROUND NO. 1, THE SAME IS DISMISSED AS NOT PRESSED. ITA. NO. 4542/M/2013 2 3. IN RESPECT OF THE GRIEVANCE RAISED VIDE GROUND NO. 2, THE LD. COUNSEL FOR THE ASSESSEE STATED THAT IT IS SQUARELY COVERED IN FAVOUR OF THE ASSESSEE AND AGAINST THE REVENUE BY THE DECI SION OF THE TRIBUNAL SPECIAL BENCH BANGALORE IN THE CASE OF BIOCON VS DCIT 25 ITR (T) 602 WHICH WAS FOLLOWED BY THE TRIBUNAL PUNE BENCH IN THE CASE OF SANDVIK ASIA PVT. LTD. VS ACIT IN ITA NOS. 1841, 1842, 2053 & 2054/PN/2012. 4. THE LD. DEPARTMENTAL REPRESENTATIVE COULD NOT BRING ANY DISTINGUISHING DECISION IN FAVOUR OF THE REVENUE. 5. WE HAVE CAREFULLY PERUSED THE ORDERS OF THE AUTHORITIES BELOW AND THE DECISION OF THE TRIBUNAL BROUGHT TO OUR NOTICE. THE GRIEVANCE OF THE ASSESSEE IS THAT THE LD. C IT(A) ERRED IN CONFIRMING THE DISALLOWANCE OF RS. 1,20,47,684/ - CLAIMED U/S. 37(1) OF THE ACT TOWARDS EMPLOYEE STOCK OPTION PLAN (ESOP) EXPENSES AS CAPITAL EXPENDITURE. AN IDENTICAL ISSUE WAS CONSIDERED BY THE TRIBUNAL SPECIAL BENCH BANGALORE IN THE CASE OF BIOCON (SUPRA) HAS HELD THAT ESOP EXPENSES IS AN ALLOWABLE DEDUCTION U/S. 37(1) OF THE ACT. THE SAME VIEW WAS FOLLOWED BY ITAT PUNE BENCH IN THE CASE OF SANDVIK ASIA (SUPRA). RESPECTFULLY FOLLOWING THE DECISION OF THE CO ORDINATE BENCHES, WE SET ASID E THE ORDER OF THE LD. CIT(A) AND DIRECT THE AO TO ALLOW THE ESOP EXPENSES AS REVENUE EXPENDITURE. 6. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED. OR DER PRONOUNCED IN THE OPEN COURT AT THE TIME OF HEARING ON 2 4 TH JUNE , 2015 SD/ - SD/ - ( I.P. BANSAL ) (N.K. BILLAIYA) /JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI ; DATED : 2 4 TH JUNE , 2015 . . ./ RJ , SR. PS ITA. NO. 4542/M/2013 3 / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT(A) - 4. / CIT 5. , , / DR, ITAT, MUMBAI 6. / GUARD FILE . / BY ORDER, //TRUE COPY// / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI