Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2014 (7) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2014 (7) TMI 165 - AT - Income TaxESOP expenses u/s 37 of the Act - Sum debited to P&L account under ESOP –Reliance place on Circular No. 9 of 2007 dated 20.12.2007 - Chargeability of Fringe Benefit Tax on ESOP - Whether the assessees claim for deduction under the head ‘Employees Stock Option Cost (ESOP)’ is an allowable expenditure u/s 37 of the Act - Held that:- AO and CIT(A) has relied upon the circular issued by the CBDT NO. 9 of 2007, for refusal of the claim of the assessee - a perusal of the circular reveals that the subject it deals with is given as “Explanatory circular on Fringe Benefit Tax Arising on allotment or transfer of specified securities or sweat equity shares” – Relying upon Biocon Ltd. Vs. DCIT [2013 (8) TMI 629 - ITAT BANGALORE] - the discount on issue of Employee Stock Option is an allowable deduction in computing the income under the head ‘Profit and gains of business or profession’ - the liability to pay the discounted premium is incurred during the vesting period and the amount of such deduction is to be found out as per the terms of the ESOP scheme by considering the period and percentage of vesting during such period - AO directed to allow the expenditure – Decided in favour of Assessee.
|