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TMI Blog2023 (6) TMI 1117X X X X Extracts X X X X X X X X Extracts X X X X ..... tized 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 income of Rs.4.98 crores, wherein it claimed deduction of brok ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 Goetze (India) P Ltd (2006)(157 Taxman 1) and the Hon'ble Allahabad High Court in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -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 expenditure as deduction. In the above said case also, the assessee therein treated the upfront d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 Employees Stock Award Plan was not an allowable expense since. * No options were exercised during th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... res 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 tranches, generally 1/3* in three vesting dates falling in each subsequent year. 7) At the time of grant of stock awards, or DB Equity Plan, 10-day average closing price of a DB share on Xetra for the 10 business days preceding the grant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , 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 copy of TDS challan (ct enclosed at pages 256 of the paperbook) for the amount deducted and paid in respect of shares vested by the employees during the financial year 2014-15. Further, copy of sample Form 16 and copy of challan for payment of tax on value of perquisite, is enclosed ..... X X X X Extracts X X X X X X X X Extracts X X X X
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