9911796707
TMI Blog2022 (4) TMI 1502X X X X Extracts X X X X X X X X Extracts X X X X ..... onvenience. 1.2. The appeal of the Revenue for the A.Y.2013-14 is taken as the lead case with the consent of both the parties. 2. The grounds raised by the Revenue for A.Y.2013-14 are as under:- 1. Whether in the facts and circumstances of the case and in law, Ld CIT (A) erred in holding that the Appellant's view of taking the Treaty benefit prior to computation of total income is correct and not considering that the aggregation of the Income and set off of losses has to be determined as per the provisions of section 66 to section 80 of the income Tax Act. Thereafter DTAA benefit has to be granted as per section 90(2) on the Total Income so arrived. 2. Whether in the facts and circumstances of the case and in law, Ld. CIT(A) erred in taking a view that the computation of total income has to be solely determined as per the provisions of the Act as per section 74(1) and not on treaty. Wherein loss is to be ascertained to be carried forwarded the subsequent assessment year on the base of net result of computation for which setting off of carried forward losses against the capital gains is required to be done. 3. Whether in the facts and circumstances of the case and in l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... apital gains' and then should claim the treaty benefit of total income under the head 'capital gains'. 3.1. Before the ld. CIT(A), the assessee stated that the very same issue was decided by the Co-ordinate Bench of this Tribunal in the case of Goldman Sachs Investments (Mauritius) Ltd., vs. DCIT reported in 187 ITD 184 dated 24/09/2020. The ld. CIT(A) relied on the said Tribunal decision and granted relief to the assessee. Aggrieved, the Revenue is in appeal before us. 3.2. We find that the issue in dispute is no longer res integra in view of the decision of this Tribunal in the case of Goldman Sachs Investments (Mauritius) Ltd., referred to supra. The facts prevailing in Goldman Sachs Investments (Mauritius) Ltd., and the action of the ld. AO in that case are as under:- Sl.No. Particular A.Y Amount Short Term Capital Gain (STT Paid A.Y.2013-14. Losses to be carry forward 1. B/F Short Term Capital Loss 2009-10 -36,94,17,35,053 3,92,43,87,502 33,01,73,47,551 2. B/F Short Term Capital Loss 2012-13 -2,32,19,35,857 2,32,19,35,857 3.3. The findings of the Tribunal are as under:- "12. We shall first deal with the grievance of the assessee th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .Y. 2005-06 the assessee had brought forward capital loss of Rs. 87,06,49,335/- from transfer of securities in A.Y. 2002-03. The aforesaid loss was determined in the hands of the assessee vide an intimation under Sec. 143(1) for A.Y 2002-03. Observing, that since the capital gains were not taxable in India as per Article 13 of the Indian-Mauritius Tax Treaty, the A.O being of the view that capital loss would also be exempted, and therefore, the assessee would not be entitled to claim the benefit of carry forward of such capital losses of the earlier years, thus, declined the set-off of the same against the capital gains for the relevant assessment years. On appeal, the CIT(A) upheld the order of the A.O. On further appeal, the Tribunal concluded that the assessee was fully justified in claiming the carry forward of the capital losses of the earlier years to the subsequent years, and both the A.O and the CIT(A) were in error in not allowing the same. Accordingly, the A.O was directed to allow the carry forward of the capital losses of the earlier years to the subsequent years, according to law. As in the aforesaid case, in the case of the present assessee before us, as the short ter ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce of income that was exempt from tax was thus not to be carried forward to the subsequent years, being devoid of any merit, is thus rejected. At this stage, we may herein observe that it is for the assessee to examine whether or not in the light of the applicable legal provisions and the precise factual position the provisions of the IT Act are beneficial to him or that of the applicable DTAA. In any case, the tax treaty cannot be thrust upon an assessee. In case the assessee during one year does not opt for the tax treaty, it would not be precluded from availing the benefits of the said treaty in the subsequent years. Our aforesaid view is fortified by the order of the ITAT, Pune in Patni Computer Systems Ltd. (supra). We thus in terms of our aforesaid observations, not being able to persuade ourselves to subscribe to the view taken by the A.O/DRP, who as noticed by us hereinabove had sought adjustment of the b/forward STCL against the exempt short term and long term capital gains earned by the assessee during the year in question, thus 'set aside' the order of the A.O in context of the issue under consideration. Accordingly, we direct the A.O to allow carry forward of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ard STCL, the Long term capital losses amounting to Rs. 7,63,95,386/- that were brought forward from the preceding years were also to be allowed to be carried forward to the subsequent years. At the same time, the DRP observed that as the assessee during the year in question i.e A.Y 2013-14 had shown short term and long term capital gains, therefore, the b/forward losses would be first 'set off' against such income, and the remaining losses would be allowed to be carried forward to the subsequent years. Accordingly, it was observed by the DRP that as the assessee had during the year in question i.e A.Y 2013-14 shown Long term capital gains of Rs. 5,63,11,782/-, therefore, the same would be first set off against the b/forward Long term capital losses of Rs. 7,63,95,386/-, and the balance amount would be allowed to be carried forward to the subsequent years. However, as the DRP in its order u/s 144C(5), dated 21-11-2016 at Page 8 - Para 2.10 had directed adjustment of the Long term capital gains of Rs. 5,63,11,782/- as against the b/forward STCL of Rs. 3926,36,70,910/-, as per sec. 74(1)(a) of the Act, therefore, pursuant to its aforesaid directions, it had therein directed t ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
