Discount on issue of ESOP is allowable deduction: Karnataka HC

PCIT Vs SAP India Pvt. Ltd. (Karnataka High Court) Background: The Revenue filed an appeal under Section 260A of the Income Tax Act, 1961, challenging the order dated 19.04.2023 passed by the Income Tax Appellate Tribunal (ITAT), Bangalore in IT(TP)A No.874/Bang/2022 for the Assessment Year (AY) 2017-18. The appellant (Revenue) raised the following substantial questions of law: Whether the ITAT was correct in holding that the discount on the issue of Employee Stock Option Plans (ESOPs) is an allowable deduction under “profits and gains of business”? Whether the ITAT erred in delet...