DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE-1(4), BENGALURU vs. FLIPKART INDIA PVT LTD, BENGALURU

ITA 1394/BANG/2025Status: DisposedITAT Bangalore04 December 2025AY 2020-21Bench: SHRI PRASHANT MAHARISHI (Vice President), SHRI KESHAV DUBEY (Judicial Member)12 pages
AI SummaryDismissed

What did the Tribunal hold?

The Tribunal held that the sale of goods at a loss did not amount to the creation of intangible assets and that ESOP expenses were allowable as revenue expenditure. The Tribunal also ruled that TDS was not applicable on these ESOP expenses.

What were the facts?

The Revenue appealed against the CIT(A)'s order which deleted additions made by the AO. The additions pertained to the capitalization of marketing intangibles and disallowance of ESOP expenses claimed by the assessee, Flipkart India Pvt. Ltd.

What were the issues?

Whether expenses incurred on ESOPs are revenue expenditure and whether they are subject to TDS. Also, whether selling goods below cost creates intangible assets.

Which sections of the Income-tax Act were involved?

Section 37,Section 195,Section 40(a)(i)

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Income Tax Appellate Tribunal, “A” BENCH : BANGALORE

Before: SHRI PRASHANT MAHARISHI & SHRI KESHAV DUBEY

For Appellant: Shri Shivanand Kalakeri, CIT(DR)(ITAT), Bengaluru
For Respondent: Shri Ajay Vohra, Sr. Advocate
Hearing: 11.09.2025Pronounced: 04.12.2025

Per Prashant Maharishi, Vice President

1.

ITA Nos.1394 & 1395/Bang/2025 for the AYs 2020-21 & 2021-22 respectively are filed by the DCIT, CC 1(4), Bengaluru (the assessee/appellant) against the appellate order of the CIT(Appeals)-11, Bengaluru dated 28.4.2025 wherein the appeal filed by the assessee against the assessment orders passed u/s. 143(3) of the Income Tax

ITA Nos.1394 & 1395/Bang/2025 Act, 1961 [the Act] passed u/s. 143(3) of the Act dated 30.8.2024 and 22.11.2024, were allowed.

2.

The Revenue is aggrieved and in appeal before us.

3.

For the AY 2020-21,

The order continues below.

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