AI Drafter 
TaxTMI 
TaxTMI 
2025 (6) TMI 650
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....matter of convenience and are being decided by way of this consolidated order. With the consent of the parties, the appeal in ITA No. 2072/Mum./2025 is considered as a lead case, and the decision rendered therein shall apply mutatis mutandis to other appeals before us. ITA No. 2072/Mum./2025 IShare ESG Aware MSCI EM ETF - A.Y. 2022-23 3. In this appeal, the assessee has raised the following grounds: - "On the facts and circumstances of the case, the Appellant craves leave to prefer an appeal against the order under section 143(3) read with section 144C(13) of the Act dated 15 January 2025, issued by the Deputy Commissioner of Income Tax (International Taxation)-2(2)(2), Mumbai ('the learned Ld.AO') in pursuance of the directions under section 144C(5) of the Act issued by the Hon'ble DRP-I, Mumbai dated 5 December 2024 on the following grounds, each of which is without prejudice to and independent of the others On the facts and in the circumstances of the case and in law, the learned AO/ Hon'ble DRP: Merits of the case: Rejecting the hierarchy of set-off of Short-Term Capital losses adopted by the Appellant 1. erred in reject....
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....es on which Securities Transaction Tax ("STT") was paid. 5. The brief facts of the case pertaining to this issue, as emanating from the record, are: The assessee is a company incorporated in Mauritius, and is registered with the Securities and Exchange Board of India as a Foreign Portfolio Investor. For the year under consideration, the assessee filed its return of income on 07/11/2022, declaring a total income of Rs. 513,82,25,780. The return filed by the assessee was selected for scrutiny, and statutory notices under section 143(2) and section 142(1) of the Act were issued and served on the assessee. During the assessment proceedings, it was observed that the assessee computed the net short-term capital gains amounting to Rs. 26,50,59,538, which is chargeable to tax as follows: - Particulars Amounts (in INR) Amount of Short-Term Capital Gains taxed at 15% under section 111A of the Act (A) 34,40,28,248 Amount of Short-Term Capital Loss taxed at 15% under section 111A of the Act (B) 9,99,56,708 Amount of Short-Term Capital Gains taxed at 30% under section 115AD of the Act(C) 2,09,87,996 Amount of Short-Term Capital Gains taxed at 30% under section 115A....
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....n 144C(5) of the Act, the learned DRP rejected the objections filed by the assessee and upheld the computation of capital gains made by the AO vide draft assessment order. The learned DRP further noted that this issue is pending consideration before the Hon'ble Bombay High Court in the case of DIT vs. M/s. DWS India Equity Fund, in ITA No.1414 of 2012, and there is no judicial finality on this issue. 10. In conformity with the directions issued by the learned DRP, the AO passed the impugned final assessment order under section 143(3) r.w. section 144C(13) of the Act computing the net short-term capital gains amounting to Rs. 24,40,71,541 taxable at 15% under section 111A of the Act and the net short-term capital gains amounting to Rs. 2,09,87,996 taxable at 30% under section 115AD of the Act. Being aggrieved, the assessee is in appeal before us. 11. During the hearing, the learned Authorized Representative ("learned AR") submitted that this issue is covered in favour of the assessee by various decisions of the Co-ordinate Bench of the Tribunal. 12. On the other hand, the learned Departmental Representative ("learned DR") vehemently relied upon the order passed by the lower....
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....pital gain irrespective of the tax bracket of such gain and losses. 017. The only dispute between the assessee and revenue is as under:- Sr. No. Assessee's version Revenue's Version 1. Short-term capital loss was set off against the net short-term capital gain on which no securities transaction taxes paid Short-term capital loss should be first set of against short-term capital gain on which securities transaction tax is paid 2. Balance short-term capital loss shall be first set of against short-term capital gain on which securities transaction taxes paid If short-term capital loss still remains it is to be carried forward and not that of against short-term capital gain on which no securities transaction tax is paid and consequently short-term capital gain on which no securities transaction tax is paid is to be taxed at the rate of 30% 3. If short-term capital gain on which securities transaction tax is paid still remains, such gains are set of against available brought forward short-term capital loss One short-term capital gain on which no securities transaction tax is paid is proposed to be taxed at the rate of 30% the brought forward ....
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....ction 48 to section 55 of the income tax act does not lay down any rate of tax payable on short-term capital gain. 021. Therefore, we do not find any reason to deprive the assessee from set-off of short-term capital losses suffered by the assessee for the same year against the short-term capital gains earned by the assessee. Such claim is in accordance with the provisions of section 70 (2) of the act. 022. We find that several judicial precedents relied upon by the assessee also supports the case of the assessee. The honourable Calcutta High Court in Rungamatee Trexim ITA number 812 of 2008 dated 19 December 2008 held that there is no provision nor the act compels the assessee to lstset of short-term capital gain which STT against short-term capital loss with STT and then allows set of against short-term capital gain without STT. Therefore, without multiplying judicial precedents, following the decision of the honourable Calcutta High Court, and several other judicial precedents of the coordinate benches relied upon before us, we allow ground number 4 - 10 of the appeal of the assessee and direct the assessing officer to allow set-off of short-term capital loss su....
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....: - "On the facts and circumstances of the case, the Appellant craves leave to prefer an appeal against the order under section 143(3) read with section 144C(13) of the Act dated 15 January 2025, issued by the Deputy Commissioner of Income Tax (International Taxation)-2(2)(1), Mumbai ['the learned AO'] in pursuance of the directions under section 144C(5) of the Act issued by the Hon'ble DRP-1, Mumbai dated 2 December 2024 on the following grounds, each of which is without prejudice to and independent of the others: On the facts and in the circumstances of the case and in law, the learned AO/Hon'ble DRP: General 1. Erred in assessing the total income of the Appellant at Rs. 2.563,142,330 instead of the returned income of Rs. 2,452,056,490. Merits of the case: Rejecting the hierarchy of set-off of Short-Term Capital losses adopted by the Appellant 2. erred in rejecting the hierarchy of set-off of short-term capital losses adopted by the Appellant and thereby, taxing the gross short-term capital gains in respect of transactions on the sale of shares not chargeable to Security Transaction Tax (STT); 3. ....
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....pital gains chargeable to tax against brought forward long term capital loss in the computation sheet; 12. Without prejudice to the above, erred in computing the income taxable at special rate at Rs 5,692,636,750 as against Rs. 2,563,142,330 determined in the impugned order respectively and consequently, computing higher tax liability; 13. erred in short grant of credit of tax deducted at source amounting to INR 380,248. Levy of interest under section 234B of the Act - Rs. 139,391,602 14. erred in levying interest under Section 234B of the Act amounting to Rs. 139,391,602. Levy of interest under section 234C of the Act - Rs. 146,705 15. erred in levying interest under Section 234C of the Act amounting to Rs. 146,705. Levy of interest under section 234D of the Act-Rs.10,020 16. erred in levying interest under Section 234D of the Act amounting to Rs. 10,020. Initiation of penal proceedings under section 270A of the Act 17. erred in initiating penalty under section 274 r.w.s. 270A of the Act alleging underreporting of income by the Appellant. The Appellant craves leave to add, alter, var....
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....073/Mum./2025 Emerging Markets Index Non-Lendable Fund - A.Y. 2022-23 30. In this appeal, the assessee has raised the following grounds: - "On the facts and circumstances of the case, the Appellant craves leave to prefer an appeal against the order under section 143(3) read with section 144C(13) of the Act dated 15 January 2025, Issued by the Deputy Commissioner of Income Tax (International Taxation)-2(2)(1), Mumbai ['the learned A01 in pursuance of the directions under section 144C(5) of the Act issued by the Hon'ble DRP-I, Mumbai dated 2 December 2024 on the following grounds, each of which is without prejudice to and independent of the others: On the facts and in the circumstances of the case and in law, the learned AO/Hon'ble DIP: General 1. Erred in assessing the total income of the Appellant at Rs. 1,536,306,420 instead of the returned income of Rs. 1,472,932,450. Merits of the case: Rejecting the hierarchy of set-off of Short-Term Capital losses adopted by the Appellant 2. erred in rejecting the hierarchy of set-off of short-term capital losses adopted by the Appellant and thereby, taxing the gr....
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.... impugned order; 11 Without prejudice to the above, erred in computing long term capital gains chargeable to tax under section 112A at Rs 2,725,030,611 as against 'NIL' determined in the impugned order; 12 Without prejudice to the above, erred in not setting off the net long term capital gains chargeable to tax against brought forward long term capital loss in the computation sheet; 13 Without prejudice to the above, erred in computing the income taxable at special rate at Rs. 4,306,691,743 as against Rs. 1,536,306,420 determined in the impugned order respectively and consequently, computing higher tax liability; 14 erred in short grant of credit of tax deducted at source amounting to INR 246,176 Levy of Interest under section 234B of the Act-Rs.121,939,776 15 erred in levying interest under Section 234B of the Act amounting to Rs. 121,939,776 Levy of interest under section 234C of the Act - Rs. 5,930 16 erred in levying interest under Section 234C of the Act amounting to Rs. 5,930 Levy of interest under section 234D of the Act - Rs. 11,518 17 erred in levying interest under Section 23....