TRENT LIMITED,MUMBAI vs. DEPUTY COMMISSIONER OF INCOME TAX 2(3)(1), MUMBAI

ITA 5166/MUM/2025Status: DisposedITAT Mumbai30 January 2026AY 2014-15Bench: SHRI PAWAN SINGH (Judicial Member), SHRI GIRISH AGRAWAL (Accountant Member)1 pages
AI SummaryPartly Allowed

What did the Tribunal hold?

The Tribunal allowed the assessee's claim for discounts on unredeemed gift cards and vouchers, holding that the discount crystallizes at the time of sale. It also directed the Assessing Officer to pass an order for book profit computation after giving effect to the CIT(A)'s order regarding loyalty programs.

What were the facts?

The assessee claimed deductions for discounts on gift cards and vouchers, and for sales promotion and loyalty programs. The revenue challenged the validity of the assessment order and the allowability of certain expenses, including brand equity fees.

What were the issues?

The key issues were the allowability of discounts on unredeemed gift cards/vouchers, the validity of the assessment order concerning TPO reference, and the treatment of sales promotion and loyalty program expenses for book profit computation.

Which sections of the Income-tax Act were involved?

Section 92CA,Section 92BA,Section 40A(2),Section 153,Section 115JB,Section 37(1),Section 14A,Section 244A,Section 56,Section 234B,Section 234C

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IN THE INCOME TAX APPELLATE TRIBUNAL “H” BENCH, MUMBAI BEFORE SHRI PAWAN SINGH, JUDICIAL MEMBER& SHRI GIRISH AGRAWAL, ACCOUNTANT MEMBER (Physical hearing) Trent Limited DCIT-2(3)(1), Mumbai 552, 5th Floor, Aayakar Bhavan, Bombay House, Mumbai, Vs Maharashtra – 400001. Maharishi Karve Road, [PAN: AAACL1838J] Mumbai-400020. Appellant / Assessee Respondent / Revenue DCIT-2(3)(1), Mumbai Mumbai-400020. Bandra E Mumbai – 400051. [PAN: AAACL1838J] Appellant / Revenue Respondent / Assessee

Assessee by Shri Nikhil Tiwari a/w Mr. Charul Mittal, CA Revenue by Shri Ajay Chandra, CIT-DR Date of hearing 23.01.2026 Date of pronouncement 30.01.2026

Order under section 254(1) of Income Tax Act

PER PAWAN SINGH JUDICIAL MEMBER:

1.

These cross-appeals by assessee as well as by revenue are directed

against the order of ld. CIT(A)/NFAC dated 30.06.2025 for A.Y. 2014-15. The assessee in its appeal has raised following grounds of appeal:

“General Grounds

1.

On the facts and in the circumstances of the case and in law, the Assessing Officer erred in assess

The order continues below.

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