2026 (4) TMI 1611

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....ed CIT(A)"] for the assessment years 2023-24. 2. In this appeal, the Revenue has raised the following grounds: - "a) Whether, on the facts and in the circumstances of the case and in law, the Ld. CIT(A) has erred in allowing the claim of ESOP expenses without appreciating that by issuing shares at below the market price, the assessee company has not incurred any revenue expenditure, rather it resulted in short receipt of share premium which the assessee was otherwise entitled to, on capital account. b) Whether, on the facts and in the circumstances of the case and in law, the Ld. CIT(A) has erred in allowing the claim of ESOP expenses without appreciating that as the receipt of share premium is not taxable, any short re....

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....endered in its own case for the assessment year 2012-13, wherein deduction in respect of ESOP expenses was allowed to the assessee. 5. The Assessing Officer ("AO"), vide order dated 23.12.2024 passed under section 143(3) of the Act, disagreed with the submissions of the assessee and held that the expenditure on ESOP compensation is not in the nature of revenue expenditure, as the same has been incurred towards raising of share capital, which is clearly capital in nature. As regards the reliance placed by the assessee on the decision of the Tribunal in its own case for the assessment year 2012-13, the AO held that the Revenue has not accepted the said decision and has filed an appeal before the Hon'ble High Court, and, thus, the matter is....

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....iven the details of date of vesting, number of shares granted, number of shares vested, perk value, taxed in the hands of employees, period of vesting. The perk value of the share ranged from Rs. 635/- to Rs. 134/- and Rs. 101/-. The perk value of the share on the date of vesting i.e. 01.11.2011 was Rs. 6158/-. The discount given in the ESOP 2008 scheme was Rs. 110.50. Further, no material was placed as to what was the value of the shares as per the market at different years of vesting (page 143 to 154 PB) ........... 27..................... 28. Hence, while laying down the principle that the discount offered on the shares under the ESOP of scheme is allowable deduction u/s 37(1) of the Act, we hereby remand the matter to ....