VINOD KUMAR GOENKA,MUMBAI vs. DY. COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE 8(1), MUMBAI, MUMBAI

ITA 5189/MUM/2026Status: DisposedITAT Mumbai28 September 2026AY 2013-1412 pages
AI SummaryAllowed

What were the facts?

The assessee, Vinod Kumar Goenka, appealed against the order of the CIT(A)-47, Mumbai, which upheld the assessment order for Assessment Year 2013-14. The dispute concerned the adjustment of ₹83,20,355 representing excess managerial remuneration for Financial Year 2011-12, which was recovered from the assessee in Financial Year 2012-13. The assessee, a whole-time director of D.B. Realty Ltd., had received ₹1,20,00,000 in FY 2011-12, which was taxed in AY 2012-13. Subsequently, upon finalization of accounts, it was determined that ₹83,20,355 was paid in excess. This amount was repaid by the assessee in FY 2012-13. The assessee sought to adjust this recovery against his salary income for AY 2013-14, but the Assessing Officer and CIT(A) rejected this claim.

What did the Tribunal hold?

The Tribunal held that the assessee is entitled to an adjustment of ₹83,20,355 while computing his income under the head "Salaries" for Assessment Year 2013-14. The Tribunal reasoned that the issue was not about claiming a deduction under Section 16, but about giving effect to an actual recovery of remuneration. Section 15 deals with chargeability of salary due or paid. Where an amount received as remuneration is subsequently found to be in excess and is actually recovered, this subsequent event cannot be disregarded. The Tribunal found that the recovery was genuine, undisputed, and supported by audited accounts and banking records. It was not a notional adjustment or an attempt to shift income. The principle of annuality, while important, cannot be invoked to completely efface a subsequent event that crystallizes and occurs in a later year. The assessment for AY 2012-13 remains untouched as the assessee did not seek to reopen it. The Tribunal reversed the finding of the CIT(A).

What were the issues?

1. Whether, for computing the assessee's income under the head "Salaries" for Assessment Year 2013-14, an adjustment ought to be given in respect of ₹83,20,355 representing excess managerial remuneration pertaining to Financial Year 2011-12, which was recovered from the assessee during Financial Year 2012-13, turning on Section 15 of the Income-tax Act, 1961. Assessee's contentions: The assessee argued that there was no dispute regarding the excess remuneration or its recovery. The amount was repaid in FY 2012-13, supported by audited accounts and bank records. The assessee was not seeking to modify the AY 2012-13 assessment or shift income, but merely to reflect the actual recovery in the current year. The assessee relied on the decision in Vrajeshwari B. Parikh v. ITO. Revenue's contentions: The Revenue contended that remuneration accrued, received, and assessed in an earlier year could not be adjusted against salary in a subsequent year without a specific statutory provision. They relied on the orders of the lower authorities.

Which sections of the Income-tax Act were involved?

Section 143(3),Section 16,Section 15

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, ‘F’ BENCH

For Appellant: Shri Ravi Ganatra
For Respondent: Shri Bal Krishna Yadav
Hearing: 07/08/2026Pronounced: 28/09/2026

PER AMIT SHUKLA (J.M): The aforesaid appeal has been preferred by the assessee against the order dated 17.02.2026 passed by the learned Commissioner of Income-tax (Appeals)-47, Mumbai [“CIT(A)”], arising out of the assessment order dated 25.02.2016 passed under section 143(3) of the Income-tax Act, 1961 (“the Act”) for Assessment Year 2013-14. The principal issue raised in this appeal is whether, while computing the assessee’s income under the head “Salaries” for the year under consideration, adjustment ought to be given in respect of ₹83,20,355 representing excess managerial remuneration pertaining to Financial Year 2011-12 which, upon finalisation and audit of the accounts of D.B. Realty Ltd., was s

The order continues below.

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