Mahindra And Mahindra Limited vs Assistant Commissioner Of Income ...
2023 Latest Caselaw 7624 Bom

          Digitally
          signed by
GAURI     GAURI AMIT
          GAEKWAD
AMIT      Date:
GAEKWAD   2023.08.03                                        1/2                    904.WP-2702-2021.doc
          10:49:29
          +0530

                               IN THE HIGH COURT OF JUDICATURE AT BOMBAY
                                   ORDINARY ORIGINAL CIVIL JURISDICTION
                                           WRIT PETITION NO.2702 OF 2021

             Mahindra and Mahindra Limited              ....Petitioner
                    V/s.
             Assistant Commissioner of Income Tax,
             Circle 2(2)(1) and Ors.                    ....Respondents
                                                ----
             Mr. Devendra Jain a/w. Mr. Ashwin Jain for petitioner.
             Mr. N.C. Mohanty for respondents.
                                                ----
                                           CORAM : K. R. SHRIRAM &
                                                      FIRDOSH P. POONIWALLA, JJ.

DATED : 1st AUGUST 2023

P.C. :

1 There are various grounds raised in the petition one of which is

that the Assessing Officer has not followed the directions given by the ITAT.

In the order of ITAT, as regards ground no.6, the ITAT has stated as under :

Ground No.6: Disallowance of Rs.5,86,81.405/-

15. This ground relates to disallowance of Rs.5,86,81,405 claimed by assessee as (ESOP) employee cost being the difference between the fair market value / the shares offered to employee on the date of the grant of option and the price at which they are offered to employee.

16. Upon careful consideration and after hearing both the Counsel and perusing the records we find that issue has been considered and decided by ITAT Special Bench in the case of Biocon Ltd., vs. Dy. CIT (ITA No.248/BANG/2010). Accordingly, we remit the issue to the file of the Assessing Officer to consider the issue in light of the ITAT Special Bench in the case of Biocon Limited.

2 Instead of complying with the directions, the Assessing Officer

has arrogated himself to the position that he can disregard the directions of

Gauri Gaekwad

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the ITAT. In the assessment order, it is stated as under :

1. The submissions of the assessee have been carefully considered and the judgment of the Special bench of Hon'ble ITAT Bangalore in the case of M/s Biocon Ltd has been referred to. The judgment of the Karnataka High Court is also perused. With due respect to the judgments of the Hon'ble High Court of Karnataka and the ITAT Special Bench, Bangalore, it is to be mentioned that the Revenue has not accepted these judgments and the Special Leave Petition is pending in the Supreme Court (The CIT LTU vs M/s Biocon Ltd, SLP (c) No.010983/2021, Diary No.14965/2021). Since, the judgment of the Apex Court is awaited and the Income Tax Department has not accepted the ruling of the High Court of the Karnataka, relief to the assessee cannot be provided and the addition made towards ESOP Expenses amounting to Rs.13,65,92,458/- is hereby sustained.

Penalty proceedings u/s 271(1)(c) of the Act is initiated for furnishing inaccurate particulars of income.

1. Disallowance u/s. 14A of Rs.47,54,00,000/-.

3                 Therefore, rule.

4                 The assessment order dated 30th September 2021 and the

consequential notice of demand also dated 30 th September 2021 are stayed

until the hearing and final disposal of this petition.

5 Petition to come up for final hearing in due course.

6                 Mr. Mohanty waives service.




(FIRDOSH P. POONIWALLA, J.)                                      (K. R. SHRIRAM, J.)




Gauri Gaekwad