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TMI Blog2022 (1) TMI 1029X X X X Extracts X X X X X X X X Extracts X X X X ..... in not applying the above rationale Mutatis mutandis for the purposes of taxability of income too under section 56(2) PDTs to be treated as individuals. Further, the Ld.CIT(A) erred in the application of the Act by changing variably the interpretation of status provision-to-provision rather than applying it in a wholesome manner. 4. The Ld. CIT(A) has erred in remitting back the issue of disallowance under section 14A for fresh consideration in contravention of provisions of section 251(1)(a) of the Act which gives only the power to confirm, reduce, enhance or annul the assessment to CIT(A). 5. The Ld.CIT(A) erred in remitting back the issue of disallowance under section 14A to the file of the AO and thereby exceeded the powers vested in Commissioner(Appeals) under section 251(1)(a)." 3. Brief facts of the case are that the assessee M/s.Shriram Ownership Trust is a Private Discretionary Trust. The assessee has filed its return of income for assessment year 2015-16 on 31.08.2015 declaring taxable income of Rs. 86,37,28,050/-. The assessment has been completed u/s.143(3) of the Income Tax Act, 1961, on 14.03.2017 and determined total income at Rs. 89,53,89,888/- by inter-alia ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... DR for the Revenue submitted that first issue is squarely covered in favour of the Revenue by the decision of Hon'ble Jurisdictional High Court of Madras in assessee's own case for assessment year 2014-15 in T.C.A No.242 of 2018 dated 08.12.2020, where the Hon'ble High Court has very categorically held that contribution received by the assessee is to be assessed as income u/s.56(2)(vii) of the Income Tax Act, 1961. 7. The learned A.R for the assessee, on the other hand, fairly agreed that this issue is covered against the assessee by the decision of Hon'ble Madras High Court in the assessee's own case for assessment year 2014-15. 8. We have heard both the parties, perused materials available on record and gone through orders of the authorities below. We find that the Hon'ble Madras High Court had considered an identical issue in assessee's own case for assessment year 2014-15 and after considering relevant facts has very categorically held that the assessee is representative assessee as defined u/s.160(1)(iv) of the Act, and benefit derived by the assessee on behalf of beneficiaries is to be taxed as an individual and hence, any contribution received by the trust is taxable as in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ne to approve. The Tribunal placed reliance on the decision of the Delhi Tribunal in Mridu Hari Dalmia Parivar Trust. We find that the said decision could not have been applied to the facts of the instant case, more particularly, when the Assessing Officer in the said case held that the assessee is an AoP. Furthermore, the finding rendered by the Tribunal with regard to the effect of insertion of clause (x) in Section 56(2) with effect from 01.04.2007 could not have been rendered in isolation without reference to the factual details where the beneficiaries were identified and therefore, the Tribunal erred in reversing the finding of the CIT(A) that the assessee has to be assessed as an "individual". Therefore, we hold that the assessee Trust is a representative assessee as it represents the beneficiaries who are identified individuals and therefore to be assessed as an "individual" only. Consequently, the contribution of Rs. 25 Crores is to be assessed as income under Section 56(1) under the head 'income from other sources'. 80. It is submitted on behalf of the assessee that it is not in dispute that in terms of Section 160(1)(iv), a trustee is a representative assessee for a be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... restored the issue to file of the Assessing Officer and directed him to recompute expenses by excluding certain administrative and personal expenses and also interest paid on loan from M/s. Piramal Enterprises Pvt.Ltd., for the reason that said expenses are not attributable to exempt income. Being aggrieved by the order of the learned CIT(A), the Revenue is in appeal before us. 11. The learned DR submitted that the learned CIT(A) has erred in remitting the issue back to the file of the Assessing Officer in contravention of provisions of section 251(1)(a) of the Act, which gives only power to confirm, reduce, enhance or annul any assessment to the learned CIT(A). The learned DR further submitted that the learned CIT(A) has erred in not appreciating fact that concept of strategic investments is done away with by the decision of the Hon'ble Supreme Court in the case of Maxopp Investments Ltd., vs. CIT (2018) 402 ITR 640(SC) and thus, for purpose of computing disallowance u/s.14A, all investments including investments made for strategic business purpose also needs to be considered. 12. The learned AR for the assessee, on the other hand, submitted that the issue is squarely cover ..... X X X X Extracts X X X X X X X X Extracts X X X X
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