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2011 (9) TMI 48 - ITAT KOLKATACapital gain - Sale value of unquoted share to closely held company - Held that:- The main dispute is regarding fixation of price of shares sold. The Assessing Officer did not accept the mode of fixation of sale price by assessee and, therefore, estimated the sale consideration. The fixation of price i.e. saleable price of unquoted shares depends upon the net assets of the company. - The price of unquoted shares is always amenable to manipulation by the closed persons to avoid taxability of the gain on the transfer by fixing price in a manner that it suits the most. The value of shares as per NAV method is most appropriate method of valuation in such circumstances. The revenue authorities under such circumstances are entitled to question the correctness of price fixation in order to find out the real intention of the assessee. Assessing Officer was of the opinion that fixation of sale price was done with ulterior motive to claim loss and, thus, was not bonafide. In order to find out whether the transactions were bonafide or not, we have to examine whether the shares were sold at a price more than the book value or not. - Matter remanded back for verification for finding out the book value.
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