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2024 (4) TMI 836 - AT - Income TaxAddition u/s 68 - enhancement of income u/s 56(2)(viib) - funds received in the form of share premium through undisclosed sources - identity of investors and creditworthiness of the investors and genuineness of the transaction not proved - CIT enhancing the income of the assessee u/s 56 (2)(viib) - HELD THAT:- As decided in DAYALU IRON & STEEL PVT. LTD [2022 (7) TMI 625 - ITAT DELHI] he authorities below without verifying the veracity of the documents from the publically available data on the web site of MCA IT Department. Once the assessee provided the names, addresses and Pan, particulars and ROC details of the investors. The Ld. A.O ought to have made further enquiry. Once the assessee furnishes the documents to prove the identity, creditworthiness and genuineness of the transaction. The same cannot be denied in the absence of material contrary brought by the Assessing Officer. The present case, the assessee has substantially provided materials to prove the genuineness of the share holders apart from giving the Pan Card, name and ROC details. CIT(A) has erred in confirming the addition u/s 68 of the Act on account of unexplained share premium and share capital. The ratio laid down in the aforesaid decision of the Tribunal squarely applies to the facts of the present captioned appeals. Enhancement made by the Ld. CIT(A) u/s 251(1) r.w.s. 56(2) (viib) - AO substituted fair market value determined by the assessee through his own valuation - Assessees have submitted the Valuation Report duly signed by the auditor by following NAV/DCF Method as required under Rule 11UA(2) of the Rules - As per relevant provisions of Rule 11UA of the Rules, fair market value of unquoted equity shares for the purposes of sub-clause (i) of clause (a) of Explanation to clause (viib) of sub-section (2) of section 56 shall be determined under clause (a) or clause (b), at the option of the assessee. The Assessees having the choice to opt for one of the methods enumerated in the above provision and the appellant has chosen to opt for clause (b) in most of the abovementioned cases for valuation of unquoted equity shares and based on the same, the value of the share had been computed. Accordingly, the new shares were issued and allotted to the investors during the captioned assessment year. During the assessment proceedings, computation of Fair Market Value of shares as per Rule 11UA(2) was submitted before the Ld.AO to justify that the shares issued by the appellants were at Fair Market Value (FMV) which was computed in accordance with Rule 11UA(2) of the Income Tax Rules, 1962. But the AO has not given any reasoning for rejecting the valuation of shares nor have they furnished any material to the contrary which justified the rejection of the valuation of shares. When the statute provides for a particular procedure, the authority has to follow the same and cannot be permitted to act in contravention of the same. It has been hitherto an uncontroverted legal position that where a statute requires to do a certain thing in a certain way, the thing must be done in that way only. Other methods or modes of performance are impliedly and necessarily forbidden. The aforesaid settled legal proposition is based on legal maxim "Expressio unis est exclusio alterius", meaning thereby that if a statute provides for a thing to be done in particular manner, then it has to be done in that manner and in no other and following other course is not permissible. Thus as Assessees have issued the shares at fair market value computed in accordance with Rule 11UA of the Rules and no fault has been found in the method applied by the assessees and thus the enhancement of the income by Ld.CIT(A) u/s 56(2)(viib) of the Act on protective basis is purely based on conjectures which has no basis in law and is liable to be deleted. Further, as the assessee has provided document to prove the identity, creditworthiness and the genuineness of the transaction of each shareholder, which has not been controverted by the Department and in the absence of any contrary material on record to disprove the same in our considered opinion, the addition of income made under section 68 of the Act as well as the enhancement of income u/s 56(2)(viib) of the Act is bad in law accordingly, the additions/enhancement made by the A.O/CIT(A) are hereby deleted. Decided in favour of assessee.
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