TaxTMI 
TaxTMI 
2023 (6) TMI 1117
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.... in (a) granting deduction of unamortized brokerage expenses of Rs.18.05 crores. (b) granting deduction of ESOP expenses of Rs.19,48,373/-. In the cross objection, the assessee has raised certain alternative contentions with regard to the above said additions. 2. The assessee company is an Asset management company of Deutsche Mutual Fund (DMF) and various other Deutsche Group Entities. 3. The first issue urged by the revenue relates to disallowance of unamortized brokerage expenses. During the year under consideration, the assessee filed original return of income on 4.11.2015 declaring a total income of Rs.23.03 crores. Subsequently, the assessee filed a revised return of income on 31.3.2017 declaring a total inco....
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....e filed u/s 139(5) of the Act, since, as per sec.139(5) of the Act, a revised return of income can be filed only if the assessee discovers any omission or any wrong statement. He held that the assessee has not shown that the original return of income suffers from any omission or wrong statement. Accordingly, the AO held that it is an afterthought of the assessee to claim unamortized brokerage expenses as deduction and it is claimed as a result of discontinuation of business. Accordingly, the AO disallowed claim for deduction of Rs.18.05 crores, referred above. 5. The Ld CIT(A), however, held that the income was revised by the assessee on bonafide reason. Accordingly, following the decision rendered by Hon'ble Supreme Court in the case of....
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....s. Thus, the balance amount of Rs.18.05 crores was to be amortised in financial years 2016-17 and subsequent years. Since the business of the assessee was discontinued on 4th March, 2016, the unamortized brokerage expenses of Rs.18.05 crores cannot be claimed in any of the subsequent years. Hence, the assessee has chosen to claim the same deduction during the year under consideration, since it was incurred during this year. 8. The assessee has taken support of the decision rendered by Hon'ble Supreme Court in the case of Taparia Tools Ltd vs. JCIT (2015)(55 taxmann.com 361), wherein it was held that merely because a different treatment was given in the books of accounts, the same could not be a reason for reject the claim of entire expen....
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....t and claimed it as deduction. The AO noticed that the employees have not exercised the option to subscribe the shares during the year under consideration. Accordingly, the AO took the view that the expense claimed by the assessee is a notional expenditure and accordingly disallowed the same. The Ld CIT(A), however, allowed the claim and hence the revenue is challenging the said decision. 10. We heard the parties and perused the record. We notice that the assessee has explained before Ld CIT(A) the nature of scheme and also addressed the various contentions of the assessing officer. The relevant submissions are extracted below:- "3.1 The AO at para 5 to 8 of the order under appeal, has held that the claim of expenses relating to....
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....1,62,141 4 Stock Retention 13,88,061 Employee cost 19,48,373 6) The GSPP is the employee participation plan available to all employees of the appellants. Under REA, certain employees are awarded shares of DB as part of the annual variable Compensation/retention award (bonus). This scheme works as a deferred compensation and is offered only to certain key senior employees. The grant value (conversion of cash in OB Shares) is determined by dividing the Euro equivalent of the Award Value by the average Closing Price of DB Share on the Frankfurt Stock (Xetra) for the last ten trading days of the month, prior to the month in which the Award is made. REA expressed in DB Shares vest in the employees over ....
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.... enclosed at pages 227 to 252AD of the paperbook 12) The shares were vested twice during the financial year 2014- 15. In November 2014, vesting amount was of Rs. 1,29,629.16 (equivalent to EURO 1,690.10) and in February 2015 vesting amount was of Rs. 20,00,099.73. Further, the copies of invoices raised by DB Group (UK) Ltd. relating to vesting of shares, during the year under appeal, are enclosed at pages 254 to 2f: of the paperbook. On vesting, requisite tax has been paid on the value of perquisite considered in the hands of employees. In the year under appeal, TDS of Rs.5,47,719 has deposited, on account of vesting of shares. Details of vesting of shares to employees (copy enclosed at pages 253 of the paperbook along with the cop....