Procter & Gamble Hygiene and Health Care Limited vs. Assessment Unit, National Faceless Assessment Centre, Delhi

Parties Involved

Facts Summary

The appeal was filed by Procter & Gamble Hygiene and Health Care Limited against the order dated 31/03/2025 passed by the National Faceless Assessment Centre (NFAC), Delhi, for the assessment year 2015-16. The assessee challenged the reopening of assessment under section 148 and the disallowance of expenses amounting to Rs.11,17,00,000 paid to the parent company towards Employee Stock Option Plan (ESOP) and International Stock Ownership Plan (ISOP). The Holding Company, Procter & Gamble Co., USA, formulated these globally integrated stock-based compensation schemes. Under the ESOP, eligible employees received stock-linked benefits upon fulfilling vesting conditions, while under the ISOP, employees could voluntarily contribute a portion of their salary towards purchasing the holding company’s shares, with the appellant contributing 50 percent of such contribution.…

Legal Issues

• 1. Validity of reopening of assessment under section 148
• 2. Disallowance of expenses under ESOP and ISOP
• 3. Excess levy of interest under section 234B
• 4. Excess levy of interest under section 234C

Judgment Outcome

Decided in favour of Assessee.

Precedents Relied Upon

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