2017 (10) TMI 1531

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....ner of Income tax (Appeals) erred on facts and in law in sustaining the disallowance of Rs. 2,09,63,780 made by the assessing officer on account of the difference between purchase price of Stock Appreciation Right ("SAR‟) and the sale price of such SAR at the time of exercise by the employees, holding the same to be capital loss not allowable business deduction. 1.1 That the Commissioner of Income tax (Appeals) erred on facts and in law in not appreciating that the above differential amount actually represents the loan granted by the appellant to Religare Enterprises Ltd. Employees SAR Trust ("the Trust‟) for the purpose of administering Employee Stock Appreciation Right Scheme ("SAR scheme‟), which was meant to b....

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.... 2.2 That the Commissioner of Income Tax (Appeals) erred on facts and in law in following decision of the co-ordinate Bench of Delhi Tribunal in the case of Ranbaxy Laboratories Ltd. v. ACIT: 124 TTJ 771, and thereby not following the principle/ ratio laid down by the Special Bench of the Tribunal in the case of Biocon Ltd. v. DCIT: 155 TTJ 649, holding that the law laid down by Special Bench does not have any precedential value." 3. Assessee is a limited company engaged in the securities business, filed its return of income for assessment year 2010 - 11 on 05/10/2010 declaring total income of Rs. 1009305722/- and filed revised return on 27/03/2012 declaring total income of Rs. 1002192108/-. 4. In the computation of the total inc....

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....ct by disallowing the difference between the sale price of stock appreciation Right and the exercise price of stock appreciation Right holding the same to be capital expenditure in relation to issue of shares to employees. Therefore, assessee, aggrieved with the order of the Ld. CIT (A) preferred appeal before us. The assessee has raised 2 grounds of the appeal, however, both the grounds of appeal are with respect to the allowance with respect to the expenditure incurred by the assessee on stock appreciation Right. 9. The Ld. authorized preventative submitted that the issue is now squarely covered in favour of the assessee by the decision of delayed bench in the group cases. The Ld. departmental representative also defended the order of ....