ADITYA BIRLA SUN LIFE AMC LIMITED,MAHARASHTRA vs. THE DEPUTY COMMISSIONER OF INCOME TAX- CIRCLE 6(1)(1), MAHARASHTRA

6701, 6702 & 6703 /Mum/2025 Aditya Birla Sun Life AMC Limited made in the regular assessment and dismissed the appeal. In A.Y. 2023–24, the CIT(A) upheld the addition on account of short- term capital gains but directed verification and grant of correct TDS credit and treated the interest grounds as consequential.

A.Y. 2017–18 A.Y. 2018–19 A.Y. 2022–23 A.Y. 2023–24 Particulars Return of 29.11.2017 27.11.2018 27.11.2022 27.11.2023 income filed on Returned Rs. Rs. Rs. Rs. total 3,33,33,48,440/- 4,17,01,72,850/- 8,44,58,08,730/- 7,48,99,79,434/- income Date of 26.12.2019 14.04.2021 28.02.2024 21.03.2025 assessment order Assessed Rs. Rs. Rs. Rs. total 3,34,76,51,568/- 4,20,47,45,482/- 8,45,13,02,470/- 7,49,13,26,247/- income

6701, 6702 & 6703 /Mum/2025 Aditya Birla Sun Life AMC Limited 10. Aggrieved by the orders of the CIT(A), the assessee is in separate appeal before us raising following grounds of appeal:

A.Y. 2017–18 (ITA No. 6663/Mum/2025) GROUND NO. I: DISALLOWANCE OF EMPLOYEES CONTRIBUTION TO PROVIDENT FUND AMOUNTING TO RS. 82,10,149/-

1. 1. On the facts and circumstances of case and in law, CIT(A) erred in upholding the action of the AO in disallowing a sum of Rs. 82,10,149/- on account of employee’s contribution to provident fund.

2. The Appellant prays that the AO be directed to allow the claim of employee’s contribution to provident fund amounting to Rs. 82,10,149/- while computing the total income of the Appellant. GROUND NO. II: DISALLOWANCE OF CLAIM OF INTEREST ON DELAYED PAYMENT OF TDS AMOUNTING TO RS. 3,29,345/- 1. On the facts and circumstances of the case and in law, CIT(A) erred in upholding the action of the AO in disallowing the claim of interest on delayed payment of TDS amounting to Rs. 3,29,345/-.

2. The Appellant prays that the AO be directed to allow the deduction of interest on delayed payment of TDS amounting to Rs. 3,29,345/-. GROUND NO. III: DISALLOWANCE OF PROVISION MADE FOR LEAVE ENCASHMENT AMOUNTING TO RS. 57,63,634/- 1. On the facts and circumstances of the case and in law, CIT(A) erred in upholding the action of the AO in disallowing the claim of provision made for leave encashment amounting to Rs. 57,63,634/-.

2. The Appellant prays that the AO be directed to allow the claim of provision of leave encashment amounting to Rs. 57,63,634/-.

6701, 6702 & 6703 /Mum/2025 Aditya Birla Sun Life AMC Limited GROUND NO. IV: NON-GRANTING OF DEDUCTION CLAIMED U/S 80G OF THE ACT AMOUNTING TO RS. 92,31,072/-

1. 1. On the facts and circumstances of case and in law, CIT(A) erred in upholding the action of the AO in not granting deduction claimed u/s 80G of the Act amounting to Rs. 92,31,072/-.

2. The Appellant prays that the claim of deduction u/s 80G amounting to Rs. 92,31,072/- be allowed. GROUND NO. V: NON-GRANTING OF DIVIDEND DISTRIBUTION TAX (“DDT”) AMOUNTING TO RS. 10,17,96,378/- 1. On the facts and circumstances of case and in law, CIT(A) erred in upholding the action of the AO in not granting the Dividend distribution tax paid by the Appellant amounting to Rs. 10,17,96,378/- in the computation sheet and in not granting refund of excess DDT paid amounting to Rs. 81,10,486/-.

2. The Appellant prays that the AO be directed to grant the full credit of DDT amounting to Rs. 10,17,96,378/- and to allow refund of excess DDT paid of Rs. 81,10,486/-. GROUND NO. VI: LEVY OF INTEREST U/S 115P OF THE ACT AMOUNTING TO RS. 2,99,79,485/- 1. On the facts and circumstances of the case and in law, CIT(A) erred in upholding the action of the AO in levying interest u/s 115P of the Act amounting to Rs. 2,99,79,485/-.

2. The Appellant prays that the AO be directed to delete the interest levied u/s 115P of the Act amounting to Rs. 2,99,79,485/-. GENERAL The Appellant craves leave to add, amend, modify, rescind, supplement or alter any of the Grounds stated hereinabove, either before or at the time of hearing of this appeal. For the Assessment year 2017-18, the assessee has raised following additional grounds of appeal:

6701, 6702 & 6703 /Mum/2025 Aditya Birla Sun Life AMC Limited 1. ADDITIONAL GROUND NO. I: NON-GRANTING OF DIVIDEND DISTRIBUTION TAX (“DDT”) AMOUNTING TO RS. 10,17,96,378/- : “On the facts and circumstances of the case and in law, CIT(A) erred in upholding the action of the AO in not granting the Dividend distribution tax paid by the Appellant amounting to Rs. 10,17,96,378/- in the computation sheet and in not granting refund of excess DDT paid amounting to Rs. 81,10,486/-. The Appellant prays that the AO be directed to grant the full credit of DDT amounting to Rs. 10,17,96,378/- and to allow refund of excess DDT paid of Rs. 81,10,486/- alongwith interest as per law.”

2. ADDITIONAL GROUND NO. II: LEVY OF INTEREST U/S 115P OF THE ACT AMOUNTING TO RS. 2,99,79,485/- : “On the facts and circumstances of the case and in law, CIT(A) erred in upholding the action of the AO in levying interest u/s 115P of the Act amounting to Rs. 2,99,79,485/-. The Appellant prays that the AO be directed to delete the interest levied u/s 115P of the Act amounting to Rs. 2,99,79,485/-.

A.Y. 2018–19 (ITA No. 6701/Mum/2025) GROUND NO. I: ADDITION ON ACCOUNT OF DEDUCTION CLAIMED U/S 80G OF THE ACT AMOUNTING TO RS. 2,53,96,666/-

1. 1. On the facts and circumstances of case and in law, CIT(A) erred in upholding the action of the AO in not granting deduction claimed u/s 80G of the Act amounting to Rs. 2,53,96,666/-.

2. The Appellant prays that the AO be directed to allow the claim of deduction u/s 80G amounting to Rs. 2,53,96,666/-. GROUND NO. II: NON-GRANT OF DEDUCTION CLAIMED U/S 36(1)(va) OF THE ACT AMOUNTING TO RS. 41,05,801/- 1. On the facts and circumstances of case and in law, CIT(A) erred in upholding the action of the AO by disallowing a sum of Rs. 41,05,801/- on account of employee’s contribution to provident fund.

6701, 6702 & 6703 /Mum/2025 Aditya Birla Sun Life AMC Limited 2. The Appellant prays that the AO be directed to allow the claim of employee’s contribution to provident fund amounting to Rs. 41,05,801/- while computing the total income of the Appellant. GROUND NO. III: DISALLOWANCE U/S 40(a) OF THE ACT AMOUNTING TO RS. 50,49,586/-

1. 1. On the facts and circumstances of the case and in law, CIT(A) erred in upholding the action of the AO in disallowing the deduction claimed on account of expenses disallowed u/s 40(a) in the previous years.

2. The Appellant prays that the AO be directed to allow the deduction amounting to Rs. 50,49,586/- u/s 40(a) of the Act. GROUND NO. IV: DISALLOWANCE U/S 43B OF THE ACT AMOUNTING TO RS. 9,076/- 1. On the facts and in the circumstances of the case and in law, CIT(A) has erred in confirming the action of the AO in disallowing a sum of Rs. 9,076/- u/s 43B of the Act on account of unpaid liability of professional tax incurred in the captioned previous year.

2. The Appellant prays that the AO be directed to allow the claim u/s 43B of the Act amounting to Rs. 9,076/- while computing the total income of the Appellant. GROUND NO. V: INCORRECT COMPUTATION OF GROSS TOTAL INCOME CHARGEABLE TO TAX 1. On the facts and circumstances of case and in law, the AO erred in computing incorrect amount of gross total income chargeable to tax amounting to Rs. 4,20,47,45,483/- instead of Rs. 4,20,47,33,978/-.

2. The Appellant prays that the AO be directed to correctly compute the gross total income chargeable to tax at Rs. 4,20,47,33,978/-. GROUND NO. VI: SHORT GRANT OF TAX DEDUCTED AT SOURCE (“TDS”) CREDIT AMOUNTING TO RS. 3,09,621/-

1. 1. On the facts and circumstances of case and in law, CIT(A) erred in confirming the action of the AO in granting a total credit of TDS amounting to Rs. 1,11,26,00,781/- instead of Rs. 1,11,29,10,402/- 6701, 6702 & 6703 /Mum/2025 Aditya Birla Sun Life AMC Limited as claimed by the Appellant in the Return of Income filed thereby resulting in short grant of TDS credit amounting to Rs. 3,09,621/-.

2. The Appellant prays that the AO be directed to grant the credit of TDS amounting to Rs. 3,09,621/-. GROUND NO. VII: LEVY OF INTEREST U/S 234D OF THE ACT AMOUNTING TO RS. 5,26,845/-

1. 1. On the facts and circumstances of case and in law, the AO erred in levying interest u/s 234D of the Act amounting to Rs. 5,26,845/- consequentially on the alleged ground that no refund is due on regular assessment.

2. The Appellant submits that the interest u/s 234D of the Act ought to be deleted. GENERAL The Appellant craves leave to add, amend, modify, rescind, supplement or alter any of the Grounds stated hereinabove, either before or at the time of hearing of this appeal.

A.Y. 2022–23 (ITA No. 6702/Mum/2025) GROUND NO. I: DISALLOWANCE OF EMPLOYEES CONTRIBUTION TO PROVIDENT FUND U/S 36(1)(va) OF THE ACT AMOUNTING TO RS. 54,93,734/-

1. 1. On the facts and in the circumstances of the case and in law, the learned CIT(A) erred in upholding the disallowance of Rs. 54,93,734/- made in the intimation issued u/s 143(1) on account of employees’ contribution to provident fund, which was sustained in the assessment order passed u/s 143(3) of the Act.

2. The Appellant prays that the AO be directed to allow the claim of employee’s contribution to provident fund amounting to Rs. 54,93,734/- while computing the total income of the Appellant.

6701, 6702 & 6703 /Mum/2025 Aditya Birla Sun Life AMC Limited GROUND NO. II: SHORT GRANT OF CONSEQUENTIAL INTEREST U/S 244A OF THE ACT 1. On the facts and circumstances of the case and in law, the Ld. AO erred in granting short interest u/s 244A of the Act.

GROUND NO. I: SHORT-TERM CAPITAL GAINS U/S 111A OF THE ACT AMOUNTING TO RS. 13,46,813/-

1. 1. On the facts and in the circumstances of the case and in law, CIT(A) erred in confirming the action of the AO in making addition of short- term capital gains u/s 111A of the Act amounting to Rs. 13,46,813/-.

2. The Appellant prays that the AO be directed to delete the addition of short-term capital gains amounting to Rs. 13,46,813/-. GROUND NO. II: SHORT GRANT OF CREDIT OF TAX DEDUCTED AT SOURCE (“TDS”) AMOUNTING TO RS. 15,76,346/- 1. On the facts and in the circumstances of the case and in law, CIT(A) erred in upholding the action of the AO in granting total credit of TDS of Rs. 1,16,95,21,997/- instead of total credit of TDS of Rs. 1,17,10,98,343/- as claimed by the Appellant in the ROI filed for the captioned assessment year.

2. The Appellant prays that the AO be directed to grant the balance TDS credit of Rs. 15,76,346/-.

6701, 6702 & 6703 /Mum/2025 Aditya Birla Sun Life AMC Limited GROUND NO. III: EXCESS LEVY OF INTEREST U/S 234B OF THE ACT AMOUNTING TO RS. 3,31,027/-

1. 1. On the facts and circumstances of the case and in law, CIT(A) erred in confirming the action of the AO in levying excess interest u/s 234B of the Act amounting to Rs. 3,31,027/-.

2. The Appellant prays that the AO be directed to delete the excess interest levied u/s 234B of the Act amounting to Rs. 3,31,027/- being consequential in nature. GROUND NO. IV: EXCESS LEVY OF INTEREST U/S 234C OF THE ACT AMOUNTING TO RS. 15,763/- 1. On the facts and circumstances of the case and in law, CIT(A) erred in confirming the action of the AO in levying excess interest u/s 234C of the Act amounting to Rs. 15,763/-.

2. The Appellant prays that the AO be directed to delete the excess interest levied u/s 234C of the Act amounting to Rs. 15,763/- being consequential in nature. GENERAL The Appellant craves leave to add, amend, modify, rescind, supplement or alter any of the Grounds stated hereinabove, either before or at the time of hearing of this appeal.

11. For the sake of clarity and orderly adjudication, we propose to deal with the appeals assessment year-wise and, within each assessment year, to consider each ground of appeal separately in the order in which the same have been raised in the respective memoranda of appeal.

12. Since, in respect of each of the grounds raised by the assessee, the learned Departmental Representative has relied upon the orders of the lower authorities, we shall proceed to (13)

6701, 6702 & 6703 /Mum/2025 Aditya Birla Sun Life AMC Limited examine each ground individually and thereafter record our findings and decision thereon.

A.Y. 2017–18 - (ITA No. 6663/Mum/2025) Ground No. I: Disallowance of employees’ contribution to provident fund amounting to Rs. 82,10,149/- 13. The learned AR fairly conceded that in view of the subsequent decision of the Hon’ble Supreme Court in Checkmate Services (P) Ltd. v. CIT [2022] 448 ITR 518, the issue now stands decided against the assessee.

is dismissed. Ground No. II: Disallowance of interest on delayed payment of TDS amounting to Rs. 3,29,345/-

15. The learned AR submitted that interest on delayed payment of TDS does not partake the character of income-tax of the assessee, but represents tax deducted and paid on behalf of a third party. It was submitted that such expenditure is not in the nature of tax on the income of the assessee. However, in view of (14)

6701, 6702 & 6703 /Mum/2025 Aditya Birla Sun Life AMC Limited the smallness of the amount involved, the learned AR submitted that this ground is not pressed.

6701, 6702 & 6703 /Mum/2025 Aditya Birla Sun Life AMC Limited 24. In the present case, it is an admitted position that the assessee has created provision for leave encashment on the basis of actuarial valuation. The Assessing Officer disallowed the same by treating it as unascertained liability, and the Ld. CIT(A) sustained the disallowance by invoking section 43B(f). In view of the binding ratio of the Hon’ble Supreme Court in Bharat Earth Movers (supra) and the consistent view taken by the co-ordinate Benches in the assessee’s group cases on identical facts, we hold that the provision for leave encashment made on actuarial basis constitutes an ascertained liability and is allowable as deduction.

is allowed. Ground No. IV: Non-granting of deduction claimed under section 80G amounting to Rs. 92,31,072/-

27. During the assessment proceedings, the Assessing Officer observed that the assessee had incurred CSR expenditure of Rs. 4,09,48,683/-, which was disallowed while computing business income. Out of the said amount, the assessee had claimed deduction under section 80G of Rs. 92,31,072/- in respect of donations made to eligible trusts. The Assessing Officer was of the view that allowing deduction under section 80G would result in double deduction of CSR expenditure. The explanation of the assessee that CSR expenditure had already been disallowed under section 37(1) and that the claim under section 80G was restricted only to eligible donations was not accepted. Relying on Explanation 2 to section 37(1), the Assessing Officer withdrew the deduction claimed under section 80G.

6701, 6702 & 6703 /Mum/2025 Aditya Birla Sun Life AMC Limited 28. Before the ld. CIT(A), the assessee reiterated that there was no double deduction, as the CSR expenditure was not claimed under section 37(1) and the claim under section 80G was confined to donations made to institutions approved under section 80G. The ld. CIT(A), however, upheld the action of the Assessing Officer by holding that, in view of the amendment to section 37(1) by the Finance Act, 2014, CSR or donation expenditure is not allowable and, consequently, deduction under section 80G in respect of such payments was not in accordance with the provisions of the Act. The ld. CIT(A) thus confirmed the withdrawal of deduction of Rs. 92,31,072/- claimed under section 80G.

6701, 6702 & 6703 /Mum/2025 Aditya Birla Sun Life AMC Limited 31. We find that the assessee had claimed deduction under section 80G in respect of donations made to institutions duly approved under the said section and had complied with the statutory conditions prescribed therein. It is an admitted position that the assessee has not claimed the impugned expenditure as deduction under section 37(1) of the Act and that its claim is restricted only to deduction under section 80G of the Act. It is also not in dispute that the donations made by the assessee do not fall within the exclusions prescribed under sub-clauses (iiihk) and (iiihl) of section 80G(2) of the Act. The issue raised before us is identical to that decided by the Co-ordinate Bench in the assessee’s own case for A.Y. 2020–21(ITA Nos. 494 & 792/Mum/2025),wherein, after detailed consideration in paras 18 to 25, it has been held that Explanation 2 to section 37(1) merely prohibits allowance of CSR expenditure as business expenditure while computing income under the head “Profits and gains of business or profession”, but does not operate as a bar against claiming deduction under Chapter VI-A, particularly under section 80G of the Act.

6701, 6702 & 6703 /Mum/2025 Aditya Birla Sun Life AMC Limited circumstances would result in double disallowance, which is neither contemplated by the statute nor intended by the Legislature.

is allowed. Additional Grounds 6701, 6702 & 6703 /Mum/2025 Aditya Birla Sun Life AMC Limited

36. Now we deal with additional grounds of appeal raised by the assessee before us. The assessee has raised additional grounds before the Tribunal relating to (i) non-granting of credit or refund of Dividend Distribution Tax (DDT) amounting to Rs. 10,17,96,378/-, and (ii) levy of interest under section 115P of the Act amounting to Rs. 2,99,79,485/-.

37. At the outset, we note that these issues emanate from the assessment order itself and the material facts necessary for adjudication thereof are already available on record. The assessee had duly disclosed the payment of DDT in the return of income as well as in the Tax Audit Report. It is also a matter of record that the assessee had addressed a specific communication to the Assessing Officer seeking grant of credit or refund of excess DDT paid. However, the Assessing Officer did not examine or adjudicate these issues while framing the assessment.

38. It is contended that the assessee specifically raised these issues before the ld. CIT(A). Nevertheless, the ld. CIT(A) also did not render any finding on the issues relating to grant of credit or refund of DDT and levy of interest under section 115P of the Act. Consequently, these issues have remained undecided at both the assessment stage and the first appellate stage.

39. The additional grounds raised by the assessee are thus directly borne out from the assessment records and the material already available on file. The assessee is not seeking to introduce any new claim or fresh evidence; rather, it seeks adjudication of (23)

6701, 6702 & 6703 /Mum/2025 Aditya Birla Sun Life AMC Limited issues which were specifically raised before the lower authorities but were not dealt with by them.

40. The powers of the appellate authorities to admit additional grounds in such circumstances are well recognised. The Hon’ble Supreme Court in Jute Corporation of India Ltd. v. CIT (189 ITR 688) has held that an appellate authority is not precluded from entertaining additional grounds when the same arise from the record and are necessary for proper adjudication of the appeal. Similarly, in National Thermal Power Co. Ltd. v. CIT (229 ITR 383), it has been held that the Tribunal can consider additional grounds where all the relevant facts are already on record and no further investigation of facts is required.

41. In the present case, the additional grounds arise from the existing material on record and their adjudication is necessary for a complete and effective disposal of the appeal. We, therefore, admit the additional grounds raised by the assessee for consideration. Additional GroundsV and VI - Non-granting of Dividend Distribution Tax (DDT) amounting to Rs. 10,17,96,378/- and levy of interest under section 115P amounting to Rs. 2,99,79,485/-

42. The learned AR submitted that these grounds were raised by way of additional grounds. It was submitted that the issue is purely factual in nature inasmuch as the computation sheet 6701, 6702 & 6703 /Mum/2025 Aditya Birla Sun Life AMC Limited pursuant to the order passed under section 143(3) did not grant credit of Dividend Distribution Tax paid and also did not grant refund of excess DDT.

6701, 6702 & 6703 /Mum/2025 Aditya Birla Sun Life AMC Limited 47. We find merit in the submission of the learned Authorised Representative that the issue requires factual verification. In the interest of justice, we deem it appropriate to restore this issue to the file of the Assessing Officer with a direction to verify the claim of payment of DDT on the basis of the Tax Audit Report, Form 26AS and other relevant records and, if found in order, to grant credit of DDT amounting to Rs. 10,17,96,378/- and refund of excess DDT amounting to Rs. 81,10,486/-, in accordance with law.

A.Y. 2018–19 - (ITA No. 6701/Mum/2025) Ground No. I: Addition on account of deduction claimed under section 80G amounting to Rs. 2,53,96,666/- 49. We have already adjudicated the issue relating to deduction under section 80G while deciding the corresponding ground for A.Y. 2017–18. Since the facts and the applicable legal principles for the year under consideration are identical, we do not consider it necessary to adjudicate the issue separately for this year. The findings recorded by us for A.Y. 2017–18 shall apply mutatis 6701, 6702 & 6703 /Mum/2025 Aditya Birla Sun Life AMC Limited mutandis to this assessment year as well. Accordingly, this ground of appeal is allowed. Ground No. II – Employees’ contribution to PF under section 36(1)(va) of Rs. 41,05,801/-

50. We also have already adjudicated the issue relating to deduction under section 80G while deciding the corresponding ground for A.Y. 2017–18. Since the facts and the applicable legal principles for the year under consideration are identical, we do not consider it necessary to adjudicate the issue separately for this year. The findings recorded by us for A.Y. 2017–18 shall apply mutatis mutandis to this assessment year as well. Accordingly, this ground of appeal is dismissed. Ground No. III: Disallowance under section 40(a) amounting to Rs. 50,49,586/-

51. During the course of assessment, the Assessing Officer noticed that the assessee had created a year-end provision on ad hoc basis in respect of certain expenses and had claimed deduction thereof. Since tax was not deducted at source on the said provision, the Assessing Officer invoked the provisions of section 40(a) of the Act and disallowed 30 per cent of the provisioned amount, resulting in a disallowance of Rs. 50,49,586/-. The Assessing Officer treated the said amount as not allowable in view of the alleged non-compliance with the tax deduction at source provisions.

6701, 6702 & 6703 /Mum/2025 Aditya Birla Sun Life AMC Limited 52. In appeal, the assessee contended that the provision in respect of which the disallowance was made was only a year-end provision and that the entire provision had been reversed in the subsequent year when no invoices were received. It was submitted that the corresponding amount had already been offered to tax by way of reduction in the computation of income and, therefore, no further disallowance was warranted.

6701, 6702 & 6703 /Mum/2025 Aditya Birla Sun Life AMC Limited the Co-ordinate Bench in the assessee’s own case(ITA Nos. 494 & 792/Mum/2025) for A.Y. 2020–21.

is allowed. Ground No. IV - Disallowance under section 43B – Rs. 9,076/- (professional tax)

57. The Assessing Officer observed that professional tax liability of Rs. 9,076/- remained unpaid as on the due date of filing of return of income. He, therefore, invoked the provisions of section 43B of the Act and disallowed the said amount. The CIT(A) confirmed the disallowance made by the Assessing Officer. He 6701, 6702 & 6703 /Mum/2025 Aditya Birla Sun Life AMC Limited held that in view of section 43B, any statutory liability is allowable only on payment basis and, since the assessee had not paid the professional tax within the prescribed time, the Assessing Officer was justified in making the disallowance.

6701, 6702 & 6703 /Mum/2025 Aditya Birla Sun Life AMC Limited the basis of Form 26AS and, in absence of reconciliation to his satisfaction, no further credit could be allowed. Ground No. VII -Levy of interest under section 234D – Rs. 5,26,845/- 61. The Assessing Officer levied interest under section 234D of the Act on the ground that the refund granted earlier was in excess of the refund determined on regular assessment. The CIT(A) upheld the levy of interest under section 234D, holding that the same was consequential and mandatory in nature once it was found that excess refund had been granted at the time of processing under section 143(1).

6701, 6702 & 6703 /Mum/2025 Aditya Birla Sun Life AMC Limited A.Y. 2022–23 - (ITA No. 6702/Mum/2025) Ground No. I - Disallowance of employees’ contribution to Provident Fund under section 36(1)(va) of the Act amounting to Rs. 54,93,734/- 64. During the processing of the return of income under section 143(1) of the Act, an adjustment was proposed in respect of employees’ contribution to Provident Fund amounting to Rs. 54,93,734/- on the ground that the same was deposited beyond the due date prescribed under the relevant welfare legislation, as reflected in clause 20(b) of Form 3CD.A show cause notice was issued to the assessee, to which the assessee replied on 30.01.2024, submitting that the employees’ contribution pertaining to the month of June 2021 had been credited to the employees’ provident fund account on July 04, 2021, which was prior to the statutory due date of July 15, 2021. The assessee enclosed a copy of the challan evidencing the date of payment as July 04, 2021, and contended that the date mentioned in the tax audit report was erroneous. However, the said explanation was not accepted at the processing stage, and the adjustment under section 143(1) was carried out. The reply of the assessee was noted, but it was stated that the issue was left to the jurisdictional Assessing Officer and subject to physical verification. Subsequently, the assessment was completed under section 143(3) read with section 144B of the Act. In the assessment order, no independent addition was made on this (32)

6701, 6702 & 6703 /Mum/2025 Aditya Birla Sun Life AMC Limited issue; instead, the income as determined under section 143(1) was adopted, and the adjustment relating to employees’ contribution to Provident Fund as made in the intimation under section 143(1) continued to form part of the assessed income.

6701, 6702 & 6703 /Mum/2025 Aditya Birla Sun Life AMC Limited  Reliance was placed on the decision of the Bangalore Bench of the Tribunal in M/s Areca Trust v. CIT(Appeals) (ITA No. 433/Bang/2023), as well as other judicial precedents, to hold that the Assessing Officer, while completing the assessment under section 143(3), could not review or sit in appeal over the intimation issued under section 143(1).  Since the assessee had not filed an appeal against the intimation under section 143(1), and no rectification order under section 154 deleting the adjustment was brought on record, the adjustment continued to hold the field.  The merits of the addition made under section 143(1) could not be examined in the appeal against the assessment order under section 143(3).  On the above reasoning, the ld. CIT(A) held that there was no infirmity in the approach of the Assessing Officer in adopting the income as per the intimation under section 143(1), declined to adjudicate the issue on merits, and dismissed the grounds raised by the assessee. Consequently, the appeal was dismissed.

68. The learned AR reiterated the facts and submitted that the issue is purely factual in nature, supported by documentary evidence on record, and the lower authorities failed to appreciate the correct factual position. The ld. AR, therefore, prayed that the disallowance be deleted.

6701, 6702 & 6703 /Mum/2025 Aditya Birla Sun Life AMC Limited 69. We have carefully considered the rival submissions, perused the material available on record, and examined the reasoning adopted by the lower authorities.

6701, 6702 & 6703 /Mum/2025 Aditya Birla Sun Life AMC Limited 72. Before the ld. CIT(A), the assessee raised a specific grievance that the Assessing Officer, while framing the scrutiny assessment under section 143(3), failed to adjudicate the issue on merits despite detailed submissions and supporting evidence being available on record. The ld. CIT(A), however, declined to examine the issue on merits and dismissed the ground by holding that the adjustment had been made under section 143(1), that there was no merger of the intimation under section 143(1) with the assessment order under section 143(3), and that the present appeal, being directed against the assessment order under section 143(3), could not be used to challenge the adjustment made under section 143(1). In doing so, reliance was placed on the decision of the Bangalore Bench of the Tribunal in M/s Areca Trust v. CIT(Appeals) (ITA No. 433/Bang/2023).

6701, 6702 & 6703 /Mum/2025 Aditya Birla Sun Life AMC Limited 83. Since in the present appeal we have granted relief to the assessee on the substantive grounds, the computation of refund and the interest payable thereon under section 244A would necessarily undergo a change. Accordingly, this ground is allowed for statistical purposes, with a direction to the Assessing Officer to recompute and grant the correct consequential interest under section 244A of the Act, as may be due to the assessee, while giving effect to this order, in accordance with law.

Ground No. I - Addition on account of Short Term Capital Gains under section 111A of the Act amounting to Rs. 13,46,813/- 84. During the course of assessment proceedings, while examining the details of capital gains, the Assessing Officer identified Issue No. 3 relating to “Large short-term capital gains declared under section 111A”, as recorded on page 5 of the assessment order.

6701, 6702 & 6703 /Mum/2025 Aditya Birla Sun Life AMC Limited tax liability, and therefore there was no loss to the Revenue. The assessee requested that the error be excused and that no penalty proceedings be initiated.

6701, 6702 & 6703 /Mum/2025 Aditya Birla Sun Life AMC Limited 91. It was further submitted that the addition made by the Assessing Officer would result in double taxation of the very same capital gains, which is impermissible in law. Without prejudice to the above, the assessee contended that even if the addition were to be sustained, the same could only be assessed under the head “Capital Gains” in accordance with the charging provisions of the Act and taxed at the applicable concessional rates, and not under any other head of income or at a higher rate of tax.

6701, 6702 & 6703 /Mum/2025 Aditya Birla Sun Life AMC Limited It was held that the Assessing Officer had merely acted upon the assessee’s own admission during assessment proceedings, and therefore no infirmity could be found in the assessment order. On this reasoning, the ld. CIT(A) dismissed the ground of appeal and confirmed the addition.

94. The learned AR submitted that the assessee had already offered the amount of Rs. 13,46,813/- to tax as capital gains in the return of income. It was contended that the said amount had been correctly offered as long-term capital gains under section 112A of the Act and that, during the course of assessment proceedings, the assessee inadvertently admitted, by mistake, that the said amount had not been offered as short-term capital gains. Relying on such inadvertent admission, the Assessing Officer treated the amount as short-term capital gains under section 111A.

95. The learned AR submitted that the admission was factually incorrect and that, on proper verification of the return of income and computation thereof, it would be evident that the gains had already been subjected to tax. It was contended that the impugned addition has resulted in double taxation of the same income. An explanatory note on capital gains, setting out the factual details and manner of computation, was stated to have been filed before the appellate authority. The learned AR, therefore, prayed that the Assessing Officer be directed to re- verify the facts on record and delete the impugned addition.

6701, 6702 & 6703 /Mum/2025 Aditya Birla Sun Life AMC Limited 96. We have carefully considered the facts on record, the assessment order, the impugned order of the ld. CIT(A), and the submissions of the learned AR.

6701, 6702 & 6703 /Mum/2025 Aditya Birla Sun Life AMC Limited 99. On the facts of the present case, once it is demonstrated that the gains arising from the transfer of 5,00,000 units had already been offered to tax as long-term capital gains, no further addition could have been made by treating the same amount again as short-term capital gains under section 111A of the Act. The impugned addition, therefore, lacks factual foundation.

6701, 6702 & 6703 /Mum/2025 Aditya Birla Sun Life AMC Limited 102. The ld. AR submitted that the assessee is legally entitled to the TDS credit under section 199 of the Act read with Rule 37BA of the Income-tax Rules, 1962, and prayed that the Assessing Officer be directed to verify the details and allow the correct credit.

Result No. Year 2017–18 Partly allowed 6701, 6702 & 6703 /Mum/2025 Aditya Birla Sun Life AMC Limited 6663/Mum/2025 2018–19 Partly allowed 6701/Mum/2025 2022–23 Allowed 6702/Mum/2025 2023–24 Allowed for 6703/Mum/2025 statistical purposes