IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH “G”, MUMBAI BEFORE SHRI NARENDRA KUMAR BILLAIYA, ACCOUNTANT MEMBER AND SHRI ANIKESH BANERJEE, JUDICIAL MEMBER I.T.A No.2897/Mum/2016 (Assessment Year: 2010-11)

Grasim Industries Limited vs Deputy CIT, Central Circle- 1(4), (Corporate Finance Division) Mumbai.

A-2, Aditya Birla Centre Room No. 902, Old CGO Building, S.K. Ahire Marge, Worli, Mumbai, 400020 Mumbai-400 030 PAN: AAACG4464B APPELLANT RESPONDENT I.T.A No.4069/Mum/2016 (Assessment Year: 2010-11)

Deputy CIT, Central Circle- vs Grasim Industries Limited

1(4), Mumbai (Corporate Finance Division)

Room No. 902, Old CGO A-2, Aditya Birla Centre Building, Mumbai, 400020 S.K. Ahire Marge, Worli, Mumbai-

400 030 PAN: AAACG4464B APPELLANT RESPONDENT Assessee by : Shri J.D. Mistry – Sr. Advocate &

Shri Madhur Agrawal Respondent by : Shri Arun Kanti Datta - CIT DR Date of hearing : 17/07/2025 Date of pronouncement : 09/09/2025 O R D E R Per Anikesh Banerjee (JM):

These are cross appeal filed by the assessee and the revenue against the order of the Commissioner of Income-tax (Appeals)-13, Mumbai [for brevity, ‘Ld. CIT(A)’] passed under section 250 of the Income-tax Act, 1961 (in shot, ‘the Act) for the Assessment Year 2010-11, date of order 11/03/2016. The impugned order emanated from the assessment order u/s 143(3) of the Act passed by the Learned Additional Commissioner of Income-tax, Range-6(3), Mumbai, dated 24/02/2014.

2. The grounds taken by the respective parties are as follows: -

Assessee:

“The Appellant Company prefers an appeal against the order of the learned Commissioner of Income Tax (Appeals)-13 [hereinafter referred as "CIT (A)"] on the following amongst other grounds each of which is without prejudice to any other. 1. On the facts and the circumstances of the case and in law the CIT (A) erred in upholding the action of the AO in not allowing deduction for the amounts paid or written back during the previous year amounting to Rs. 14,43,27,418/-, which had already been disallowed in the past under clauses (b) to (f) of section 43B, consistent with the Department's stand.

2. On the fact and the circumstances of the case and in law, the CIT (A) erred in upholding the action of AO in making addition of Rs. 99,02,963/- towards interest paid to Income Tax Department during the previous year and failed to follow the decision of Mumbai ITAT in the Appellant's own case for AY 1976-77 wherein it is held that only net interest is either assessable to tax or liable to disallowance.

3. On the facts and the circumstances of the case and in law, the CIT (A) erred in upholding the action of the AO in not allowing depreciation allowance of Rs.

4,12,560/- in respect of certain properties.

4. On the facts and the circumstances of the case and in law, the CIT (A) erred in upholding the action of the AO in not allowing deduction of Rs. 6,49,506/- towards expenses incurred on administration of retirement benefit trusts as business expenditure.

5. On the facts and circumstances of the case and in law, the CIT (A) erred in not directing the AO to re-compute the capital gain arising on transfer of the Sponge Iron Unit and allow deduction from the sale proceeds of claims if any payable by the Appellant Company in future towards liabilities, representation and warranties.

6. On the facts and circumstances of the case and in law, the CIT (A) erred in not holding that the gain arising on transfer of Sponge Iron Unit is not chargeable to tax u/s 45 of the Income Tax Act, 1961. The learned CIT (A) failed to appreciate that the transfer was not a sale transaction but resulted pursuant to the order of the High Court and failed to follow the decision of the Mumbai ITAT in the case of Avaya Global Connect Ltd. (26 SOT 397).

7. On the facts and circumstances of the case and in law, the CIT (A) erred in upholding the action of the AO in not allowing the claim of the Appellant Company for deduction u/s 801A of the Act of Rs. 17,26,15,757/-in respect of Water Treatment Sys