Novo Nordisk India P. Ltd. v. DCIT

42 Taxmann.com 168Income Tax Appellate Tribunal2014#3427 most cited

What is Novo Nordisk India P. Ltd. v. DCIT authority for?

ESOP cross-charge expenses are allowable as a deduction under Section 37 of the Income Tax Act. The difference between the fair market value of shares and the price at which they are issued to employees of an Indian associated enterprise constitutes an ascertained liability that is revenue in character.

35

judgments rely on this decision, according to BharatTax’s citation analysis of 366,470 Indian tax judgments — from 2015 to 2025.

Also referred to as

Novo Nordisk India Pvt Ltd v DCIT · Section 37 · ESOP expenses · share-based compensation · cross charge expenses · ascertained liability · revenue expenditure · ITAT Bangalore

Sections most often in play

Section 143(3)Section 195Section 37(1)Section 144C(13)Section 145(3)Section 263Section 35DDASection 37
Read the full judgment

Issues it is cited on

section 2(15a)section 17(2)section 4(1)captive service providersection 50c(1)section 28(i)dcf methodsection 192section 40(a)(i)valuation of shareswithholding taxslump sale

Judgments citing Novo Nordisk India P. Ltd. v. DCIT

Cerner Healthcare Solutions India Private Limited (Erstwhile Cerner Healthcare Solution Private Limited), Bangalore vs. Deputy Commissioner of Income Tax, Circle-2(1)(1), Bangalore

In the result, the appeal of the assessee is partly allowed

ITA 171/BANG/2022[2017-18]Status: DisposedITAT Bangalore27 Jul 2022AY 2017-18

Bench: Shri George George K. & Ms. Padmavathy S

For Appellant: Shri Sumit Khurana, CAFor Respondent: Shri Srinivas T. Bidari, CIT(DR)(ITAT), Bengaluru
Section 115JSection 143(3)Section 154Section 270ASection 37Section 40

…inate bench of the Tribunal in assessee’s own case (supra) has dealt with the same issue and held as under:- “4. After hearing both the parties we find that similar issue came for consideration of the Tribunal in the case of Novo Nordisk India (P) Ltd. (2014) 63 SOT 242 Bang – Trib.) wherein it was held as under:- In the present case, there is no dispute that the liability has accrued to the assessee during the previous year. The only question to be decided is as to whether it is the expenditure of the assessee or that of the parent company. The foreign parent company has a policy of offering ESOP to its employee…

Morgan Stanley Advantage Services P Ltd., Mumbai vs. CIT (Apeals), Nationa Faceless Appeal Centre, Delhi, Mumbai

In the result, appeal of the assessee is allowed

ITA 1083/MUM/2021[2016-17]Status: DisposedITAT Mumbai27 Jun 2022AY 2016-17

Bench: Shri Kuldip Singh & Shri Gagan Goyalmorgan Stanley Advantage Services Pvt. Ltd. Athena Building No.5, Sector-30, Mindspace, Goregaon (West), Mumbai-400090 Pan: Aaeca3400B ...... Appellant Vs. Commissioner Of Income Tax (Appeals), National Faceless Appeals Centre, Delhi. ..... Respondent Appellant By : Sh. Sunil M. Lala Respondent By : Sh. Amol B. Kirtane Date Of Hearing : 20/06/2022 Date Of Pronouncement : 27/06/2022 Order Per Gagan Goyal, A.M: This Appeal By The Assessee Is Directed Against The Order Of Commissioner Of Income Tax (Appeals), National Faceless Appeals Centre (Nfac), Delhi. [Hereinafter Referred To As ‘The Cit(A)’] Vide Order Dated 11.12.2018 For The Assessment Year (Ay) 2016-17. The Assessee Has Raised The Following Grounds Of Appeal: “Ground 1: Disallowance Of Expenditure Claimed Towards Employee Stock Option Scheme (Esop) Under Section 37(1) Of The Income-Tax Act, 1961 (Act) Amounting To Rs 1,84,75,816. In This Regard, The Learned Cit(A)/ Learned Assessing Officer Has, On The Facts & Circumstances Of The Case & In Law, Erred On The Following Grounds:

For Appellant: Sh. Sunil M. LalaFor Respondent: Sh. Amol B. Kirtane
Section 143(2)Section 271Section 271(1)(c)Section 30Section 37(1)

…IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH “E”, MUMBAI BEFORE SHRI KULDIP SINGH, JUDICIAL MEMBER AND SHRI GAGAN GOYAL, ACCOUNTANT MEMBER Morgan Stanley Advantage Services Pvt. Ltd. Athena Building No.5, Sector-30, Mindspace, Goregaon (West), Mumbai-400090 PAN: AAECA3400B ...... Appellant Vs. Commissioner of Income Tax (Appeals), National Faceless Appeals Centre, Delhi. ..... Respondent Appellant by : Sh. Sunil M. Lala Respondent by : Sh. Amol B. Kirtane Date of hearing : 20/06/2022 Date of pronouncement : 27/06/2022 ORDER PER GAGAN GOYAL, A.M: This appeal by the assessee is directed against the order of…

Cerner Healthcare Solution India Private Limited(Earlier Known As Cerner India Health Services Private Limited) ( Erstwhile Cerner Healthcare Solutions Private Limited), Bangalore vs. Deputy Commissioner of Income Tax, Circle-2(1)(1), Bangalore

The appeal is allowed in favour of the assessee

ITA 254/BANG/2021[2016-17]Status: DisposedITAT Bangalore18 May 2022AY 2016-17

Bench: Shri George George K. & Ms. Padmavathy S

For Appellant: Shri Chavali Narayan, CAFor Respondent: Dr. Manjunath Karkihalli, CIT(DR)(ITAT), Bengaluru
Section 10ASection 143(1)Section 143(3)Section 144CSection 271(1)(c)Section 37Section 40

…s own case (supra) has dealt with the same issue and held as under:- “4. After hearing both the parties we find that similar issue came for consideration of the Tribunal in the case of IT(TP)A No.254/Bang/2021 Page 5 of 14 Novo Nordisk India (P) Ltd. (2014) 63 SOT 242 Bang – Trib.) wherein it was held as under:- In the present case, there is no dispute that the liability has accrued to the assessee during the previous year. The only question to be decided is as to whether it is the expenditure of the assessee or that of the parent company. The foreign parent company has a policy of offering ESOP to its employee…

Ibm India Private Limited, Bangalore vs. Deputy Commissioner of Income Tax, Circle-3(1)(1), Bangalore

In the result, appeal by the assessee stands allowed as indicated hereinabove

ITA 289/BANG/2021[2015-16]Status: DisposedITAT Bangalore14 Feb 2022AY 2015-16

Bench: Shri. B.R. Baskaran & Smt. Beena Pillaiit(Tp)A No. 289/Bang/2021 Assessment Year : 2015-16 M/S. Ibm India Pvt. Ltd., The Deputy No. 12, Subramanya Commissioner Of Arcade, Income-Tax, Bannerghatta Road, Circle 3 (1)(1), Bangalore – 560 029. Vs. Bangalore. Pan: Aaaci4403L Appellant Respondent Assessee By : Shri Ajay Roti, Ca Revenue By : Shri Pradeep Kumar, Cit Dr Date Of Hearing : 12-01-2022 Date Of Pronouncement : 14-02-2022 Order Per Beena Pillaipresent Appeal By The Assessee Has Been Filed By Assessee Against The Final Assessment Order Dated 30.04.2021 U/S. 143(3) R.W.S. 144C(13) R.W.S. 144B Of The Act Passed By The National Faceless Assessment Centre, Delhi Relating To Assessment Year 2015-16 On Following Grounds Of Appeal: “The Grounds Stated Hereunder Are Independent Of & Without Prejudice To One Another. The Appellant Submits As Under: 1. Assessment Order Bad In Law 1.1. At The Outset, M/S Ibm India Private Limited (Hereinafter Referred To As 'The Appellant' Or 'The Company') Prays That The Order Dated April 30. 2021

For Appellant: Shri Ajay Roti, CAFor Respondent: Shri Pradeep Kumar, CIT DR
Section 10ASection 143(3)Section 144BSection 144C(13)

…IN THE INCOME TAX APPELLATE TRIBUNAL ‘C’ BENCH : BANGALORE BEFORE SHRI. B.R. BASKARAN, ACCOUNTANT MEMBER AND SMT. BEENA PILLAI, JUDICIAL MEMBER IT(TP)A No. 289/Bang/2021 Assessment Year : 2015-16 M/s. IBM India Pvt. Ltd., The Deputy No. 12, Subramanya Commissioner of Arcade, Income-tax, Bannerghatta Road, Circle 3 (1)(1), Bangalore – 560 029. Vs. Bangalore. PAN: AAACI4403L APPELLANT RESPONDENT Assessee by : Shri Ajay Roti, CA Revenue by : Shri Pradeep Kumar, CIT DR Date of Hearing : 12-01-2022 Date of Pronouncement : 14-02-2022 ORDER PER BEENA PILLAI, JUDICIAL MEMBER Present appeal by the assessee has been filed…

M/S Novozymes South Asia Pvt Ltd, Bangalore vs. Assistant Commissioner of Income Tax Circle-5(1)(1), Bangalore

In the result, both the appeals of the assessee are allowed

ITA 895/BANG/2018[2013-14]Status: DisposedITAT Bangalore29 Jun 2021AY 2013-14

Bench: Shri George George K. & Shri B.R. Baskaranit(Tp)A No.894/Bang/2018 Assessment Year:2012-13

For Appellant: Shri T. Suryanarayan, A.RFor Respondent: Ms. Neera Malhotra, D.R

…so confirmed the disallowance in both the years. 7. We heard the parties and perused the record. We notice that an identical issue has been considered by the coordinate bench in the assessee’s own case relating to assessment year 2006-07 reported in 2014-15 (42 Taxmann.com 168). The coordinate bench has allowed the claim of the assessee with the following observations: “6. The Assessee framed Novo Nordisk India Private Limited Employee Stock Purchase Scheme, 2005. ("hereinafter referred to as ESOP") whereby it offered shares of NNAS to its employees subject to certain terms and conditions set out in the scheme.…

M/S Novozymes South Asia Pvt Ltd, Bangalore vs. Joint Commissioner of Income Tax (OSD) Circle-5(1)(1), Bangalore

In the result, both the appeals of the assessee are allowed

ITA 894/BANG/2018[2012-13]Status: DisposedITAT Bangalore29 Jun 2021AY 2012-13

Bench: Shri George George K. & Shri B.R. Baskaranit(Tp)A No.894/Bang/2018 Assessment Year:2012-13

For Appellant: Shri T. Suryanarayan, A.RFor Respondent: Ms. Neera Malhotra, D.R

…so confirmed the disallowance in both the years. 7. We heard the parties and perused the record. We notice that an identical issue has been considered by the coordinate bench in the assessee’s own case relating to assessment year 2006-07 reported in 2014-15 (42 Taxmann.com 168). The coordinate bench has allowed the claim of the assessee with the following observations: “6. The Assessee framed Novo Nordisk India Private Limited Employee Stock Purchase Scheme, 2005. ("hereinafter referred to as ESOP") whereby it offered shares of NNAS to its employees subject to certain terms and conditions set out in the scheme.…

M/S Qliktech India Private Limited, Bangalore vs. Deputy Commissioner of Income Tax Circle-5(1)(1), Bangalore

In the result, the appeal filed by the assessee stands allowed in the terms indicated above

ITA 1140/BANG/2018[2013-14]Status: DisposedITAT Bangalore10 May 2019AY 2013-14

Bench: Shri Arun Kumar Garodia & Shri Pavan Kumar Gadaleassessment Year :2013-14 M/S. Qliktech India Private Limited, The Deputy The Millennia, No. 1 & 2, 4Th Commissioner Of Income Floor, A Wing, Vs. Tax, Murphy Road, Ulsoor, Circle – 5 (1) (1), Bangalore – 560 008. Bangalore. Pan: Aaacq2405N Appellant Respondent Assessee By : Shri S.K. Agarwal, Ca Revenue By : Shri C. Sundar Rao, Cit (Dr) Date Of Hearing : 10.04.2019 Date Of Pronouncement : 10.05.2019

For Appellant: Shri S.K. Agarwal, CAFor Respondent: Shri C. Sundar Rao, CIT (DR)
Section 234Section 250Section 271(1)(c)Section 37

…thus, incurred wholly and exclusively for the purpose of the business of the Appellant. Page 2 of 11 4. That the Ld. CIT(A) has erred in not appreciating the principles laid down by the Hon'ble Bangalore ITAT in the case of Novo Nordisk India (P.) Ltd. [2014] 63 SOT 242 and Biocon Ltd. [20131 25 ITR (T) 602 (SB) which are squarely applicable to the case of the Appellant. 5. That the Ld. CIT(A) has erred in concluding that the case laws relied upon by the Appellant are not relevant to the Appellant's case without providing for any specific reason for the same. 6. That on the facts and in circumstances of the case…

Korn Ferry International P.Ltd, Mumbai vs. ACIT (OSD) Cir 3(2), Mumbai

ITA 7367/MUM/2014[2011-12]Status: DisposedITAT Mumbai27 Jul 2016AY 2011-12

Bench: Shri Amit Shukla () & Shri Ashwani Taneja (Acountant Member)

Section 143(3)Section 14A

…IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES “A”, MUMBAI BEFORE SHRI AMIT SHUKLA (JUDICIAL MEMBER) AND SHRI ASHWANI TANEJA (ACOUNTANT MEMBER) I.T.A. No. 7367/Mum/2014 (Assessment Year: 2011-12) Korn Ferry International Pvt Ltd vs ACIT (OSD) Piramal Tower, Peninsula Corporate Mumbai Park, Lower Parel, Mumbi-13 PAN : AAACW0557B (Appellant) (Respondent) I.T.A. No. 7139/Mum/2014 (Assessment Year: 2011-12) Dy.CIT 3 (2)(2) vs Korn Ferry International Pvt Ltd Mumbai Piramal Tower, Peninsula Corporate Park, Lower Parel, Mumbi-13 (Appellant) (Respondent) Appellant by Shri Milind Thakore Respondent by Shri Gane…

DCIT 3(2)(2), Mumbai vs. Korn Ferry International P.Ltd, Mumbai

ITA 7139/MUM/2014[2011-12]Status: DisposedITAT Mumbai27 Jul 2016AY 2011-12

Bench: Shri Amit Shukla () & Shri Ashwani Taneja (Acountant Member)

Section 143(3)Section 14A

…IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES “A”, MUMBAI BEFORE SHRI AMIT SHUKLA (JUDICIAL MEMBER) AND SHRI ASHWANI TANEJA (ACOUNTANT MEMBER) I.T.A. No. 7367/Mum/2014 (Assessment Year: 2011-12) Korn Ferry International Pvt Ltd vs ACIT (OSD) Piramal Tower, Peninsula Corporate Mumbai Park, Lower Parel, Mumbi-13 PAN : AAACW0557B (Appellant) (Respondent) I.T.A. No. 7139/Mum/2014 (Assessment Year: 2011-12) Dy.CIT 3 (2)(2) vs Korn Ferry International Pvt Ltd Mumbai Piramal Tower, Peninsula Corporate Park, Lower Parel, Mumbi-13 (Appellant) (Respondent) Appellant by Shri Milind Thakore Respondent by Shri Gane…

Shriram Insight Share Brokers Limited, Chennai vs. DCIT, Chennai

In the result, I.T.A. Nos

ITA 735/CHNY/2015[2011-2012]Status: DisposedITAT Chennai05 May 2016AY 2011-2012

Bench: Shri N.R.S. Ganesan & Shri A. Mohan Alankamonyआयकर अपील सं./Ita Nos.733, 734 & 735/Mds/2015 "नधा"रण वष" / Assessment Years : 2008-09, 2010-11 & 2011-12

For Appellant: Shri R. Sivaraman, AdvocateFor Respondent: Shri Arun C. Bharat, CIT
Section 143(3)Section 147Section 148Section 37

…Mds/15 of the considered opinion that the CIT(Appeals) has rightly confirmed the disallowance made by the Assessing Officer. 10. We have carefully gone through the decision of Bangalore Bench of this Tribunal in Novo Nordisk India Pvt. Ltd. v. DCIT (2014) 63 SOT 242. In the case before the Bangalore Bench, the actual issue of shares of the parent company by the assessee to its employees is not in dispute. Therefore, the difference between the fair market value of the shares of the parent company on the date of issue of shares and the price at which those shares were issued by the assessee to its employees was…

Shriram Insight Share Brokers Limited, Chennai vs. DCIT, Chennai

In the result, I.T.A. Nos

ITA 734/CHNY/2015[2010-2011]Status: DisposedITAT Chennai05 May 2016AY 2010-2011

Bench: Shri N.R.S. Ganesan & Shri A. Mohan Alankamonyआयकर अपील सं./Ita Nos.733, 734 & 735/Mds/2015 "नधा"रण वष" / Assessment Years : 2008-09, 2010-11 & 2011-12

For Appellant: Shri R. Sivaraman, AdvocateFor Respondent: Shri Arun C. Bharat, CIT
Section 143(3)Section 147Section 148Section 37

…Mds/15 of the considered opinion that the CIT(Appeals) has rightly confirmed the disallowance made by the Assessing Officer. 10. We have carefully gone through the decision of Bangalore Bench of this Tribunal in Novo Nordisk India Pvt. Ltd. v. DCIT (2014) 63 SOT 242. In the case before the Bangalore Bench, the actual issue of shares of the parent company by the assessee to its employees is not in dispute. Therefore, the difference between the fair market value of the shares of the parent company on the date of issue of shares and the price at which those shares were issued by the assessee to its employees was…

Shriram Insight Share Brokers Limited, Chennai vs. DCIT, Chennai

In the result, I.T.A. Nos

ITA 733/CHNY/2015[2008-2009]Status: DisposedITAT Chennai05 May 2016AY 2008-2009

Bench: Shri N.R.S. Ganesan & Shri A. Mohan Alankamonyआयकर अपील सं./Ita Nos.733, 734 & 735/Mds/2015 "नधा"रण वष" / Assessment Years : 2008-09, 2010-11 & 2011-12

For Appellant: Shri R. Sivaraman, AdvocateFor Respondent: Shri Arun C. Bharat, CIT
Section 143(3)Section 147Section 148Section 37

…Mds/15 of the considered opinion that the CIT(Appeals) has rightly confirmed the disallowance made by the Assessing Officer. 10. We have carefully gone through the decision of Bangalore Bench of this Tribunal in Novo Nordisk India Pvt. Ltd. v. DCIT (2014) 63 SOT 242. In the case before the Bangalore Bench, the actual issue of shares of the parent company by the assessee to its employees is not in dispute. Therefore, the difference between the fair market value of the shares of the parent company on the date of issue of shares and the price at which those shares were issued by the assessee to its employees was…

Korn Ferry International P.Ltd, Mumbai vs. DCIT 3(2), Mumbai

Appeal of the AO is dismissed

ITA 6468/MUM/2013[2010-11]Status: DisposedITAT Mumbai22 Apr 2016AY 2010-11
For Appellant: Shri Madhur Agarwal & Ms. Priyanka –(AR)For Respondent: Ms. Radha K. Narang
Section 14ASection 254(1)

…आयकर आयकर अपीलीय अपीलीय अिधकरण अिधकरण," ए” खंडपीठ खंडपीठ मुंबई मुंबई आयकर आयकर अपीलीय अपीलीय अिधकरण अिधकरण खंडपीठ खंडपीठ मुंबई मुंबई INCOME TAX APPELLATE TRIBUNAL,MUMBAI-“A”,BENCH सव"ी जोिग"दर "सह, "याियक सद"य एवं राजे"", लेखा सद"य Before S/Shri Joginder Singh,Judicial Member & Rajendra,Accountant Member आयकर अपील सं./ITA No./6468/Mum/2013 ,िनधा"रण िनधा"रण िनधा"रण वष" िनधा"रण वष" वष" /Assessment Years: 2010-11 वष" Korn Ferry International Pvt. Ltd. DCIT-3(2) Mumbai-400 020. Piramal Tower, Penninsula Coporate Vs. Park, Lower Parel,Mumbai-400 013. PAN:AAACW 0577 B आयकर अपील सं./ITA No./6269/Mum/2013 ,िनधा"रण ि…

Korn Ferry International P.Ltd, Mumbai vs. DCIT 3(2), Mumbai

ITA 5152/MUM/2012[2008-09]Status: DisposedITAT Mumbai31 Mar 2016AY 2008-09
For Appellant: Ms. Neha ParanjpeFor Respondent: Shri M/ Murli
Section 143Section 14ASection 254(1)

…आयकर अपीलीय अिधकरण, , , , मुंबई आयकर अपीलीय अिधकरण मुंबई “ए” खंडपीठ खंडपीठ आयकर अपीलीय अिधकरण आयकर अपीलीय अिधकरण मुंबई मुंबई खंडपीठ खंडपीठ Income-tax Appellate Tribunal -“A”Bench Mumbai सव"ी जोिग"दर "सह, "याियक सद"य एवं राजे"", लेखा सद"य Before S/ShJoginder Singh,Judicial Member & Rajendra,Accountant Member आयकर अपील सं./ITA.s.5152/Mum/2012,िनधा"रण िनधा"रण िनधा"रण वष" िनधा"रण वष" वष" /Assessment Year :2008-09 वष" Korn Ferry International Pvt. Ltd. DCIT-3(2) Piramal Tower, Penninsula Coporate Mumbai. Park, Lower Parel Vs. Mumbai-400 013. PAN:AAACW 0577 B (अपीलाथ" /Appellant) (""यथ" / Respondent) Revenue by: S…

Tata Consultancy Services Ltd, Mumbai vs. Addl CIT 2(3), Mumbai

The appeal is partly allowed

ITA 6820/MUM/2010[2005-06]Status: DisposedITAT Mumbai04 Nov 2015AY 2005-06

Bench: Sh. A.D. Jain & Sh. Rajendraassessment Year: 2005-06 Pan : Aaacr4849R M/S. Tata Consultancy Services Ltd. Vs. Addl. Commr. Of Income-Tax, 9Th Floor, Nirmal Building, Range 2(3), Nariman Point, Mumbai. Mumbai. (Appellant) (Respondent) Appellant By:Sh. Dinesh Vyas, Sr. Advocate Respondent By:Sh. N.K. Chand, Cit(Dr) Date Of Hearing : 30/07/2015 Date Of Pronouncement: 04/11/2015 Order Per A.D. Jain, Jm

For Appellant: Sh. Dinesh Vyas, Sr. AdvocateFor Respondent: Sh. N.K. Chand, CIT(DR)
Section 14ASection 30Section 40Section 70Section 90Section 91

…nce. It has further been contended that the expenditure accounted for by the assessee is as per the SEBI Guidelines. Reliance has been placed on the following case laws: i) “Biocon Limited”, 25 ITR (T) 402 (SB) Bangalore ii) “Nova Nordisk India (P) Ltd.”, 63 SOT 242 (ITAT Banglore) iii) “SSI Ltd.”, 85 TTJ 1049 (Chennai ITAT) iv) “PVP Ventures Limited”, ( 211 Taxman 554) (Mad) v) Spray Engineering, 53 SOT 70 (ITAT Chandigarh) vi) “Dr. Reddy’s Laboratories Limited”, 30 ITR (T) 393 (ITAT Hyd) vii) “Seassoon David”, 118 ITR 261 (SC). 28. On the other hand, the ld. DR has placed strong reliance on the impugned or…