DCIT vs. Kaushik Shah Shares & Securities Pvt. Ltd. ITAT Mumbai `A’ Bench Before B. Ramakotaiah (AM) and Vivek Varma (JM) ITA No. 2163/Mum/2013 A.Y.: 2008-09. Decided on: 10th July, 2013.

Facts:
The Assessing Officer noticed that the assessee had made tax payment under normal provisions by comparing its tax liability (before claiming rebate u/s. 88E) on total income with income u/s. 115JB. The assessee submitted that tax rebate is a step which comes after determining income-tax payable on total income computed as per applicable provisions. It supported its view by income tax return ITR 6 prescribed by CBDT wherein gross tax liability before claim of rebate u/s 88E is first to be compared with tax credit under MAT and then from the higher of the MAT liability and tax liability under normal provisions of the Act, tax rebate u/s. 88E is to be reduced to arrive at a final tax payable by the assessee. The contention of the assessee was rejected by the AO.

Aggrieved, the assessee preferred an appeal to CIT(A) where it was contended that rebate u/s. 88E was also to be allowed while working out tax liability u/s. 115JB for the purpose of determining tax liability u/s. 115JB. Reliance was placed on decision of Bangalore Bench of ITAT in the case of Horizon Capital Ltd and also on the decision of Mumbai Bench of ITAT in the case of Naman Securities Finance Pvt. Ltd. The CIT(A) allowed the appeal of the assessee on this ground.

Aggrieved, the revenue preferred an appeal to the Tribunal.

Held:
The Tribunal noted that the issue is covered by the decision of the Karnataka High Court in the case of CIT vs. Horizon Capital Ltd. (ITA No. 434 of 2010 dated 24.10.2011) and by the following decisions of coordinate Bench –

1 Ambit Securities Broking P. Ltd. vs. ACIT (ITA No. 7856/M/2011, AY 2008-09, order dated 6.6.2013);
2 DCIT vs. Arcadia Share & Stock Brokers Pvt. Ltd. (ITA No. 1515/M/2012, AY 2008-09, order dated 20.3.2013);
3 SVS Securities Pvt. Ltd. (ITA No. 6149/M/2011, AY 2008-09, order dated 8.8.2012).
Since the CIT(A) had followed the decision of the co-ordinate Bench in the case of Horizon Capital Ltd which was confirmed by the Karnataka High Court and also the decision of the co-ordinate Bench in the case of Naman Securities Finance Pvt. Ltd. which in turn has been followed by other co-ordinate Benches, the Tribunal did not see any merit in the grounds raised by the revenue.
The appeal filed by the revenue was dismissed.