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TMI Blog2022 (9) TMI 1314X X X X Extracts X X X X X X X X Extracts X X X X ..... in favour of assessee solely relying on the decision of Hon'ble ITAT in the assessee's own case for AY 2009-10, without appreciating the legal position that the said issue had not attained finality since departments appeal filed u/s.260A against the said decision was still pending before Hon'ble Bombay High Court? 3. Whether on the facts and circumstances of the case and in law the Ld.CIT(A) has erred in holding that the Share Premium was by assessee, ignoring the findings of the Assessing Officer given in the assessment order that the assessee company failed to furnish authentic documentary evidence to justify basis of charging premium, the Return of assessee company filed for year under consideration as well as for earlier years showed consistent losses and hence the valuation of shares done adopting DCF without considering the Income Tax Liability of preceding years was meaningless, as once these liabilities were taken into consideration the Share Valuation would be much below the value arrived at by assessee and hence the share premium was not justified? 4. Whether on the facts and circumstances of the case and in Law the Ld.CIT(A) has erred in deleting the add ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ial decision and as per the terms of issue. Further, the valuation was done using discounted cash flow method and the same was adopted for charging the premium. The assessee also contended that all the subscribers have explained the source of income and the assessee group has also shown substantial grown in a subsequent year in a consolidated form. The Assessing Officer, vide order dated 09/03/2015, passed under section 143(3) of the Act did not agree with the submissions of the assessee and held that the assessee company has shown consistent losses and in such a scenario the valuation done by adopting DCF method without considering the income tax liability of the preceding year, which is confirmed and crystallized in appellate proceedings is meaningless. The Assessing Officer further held that once these liabilities are taken into consideration, the share valuation will be much below the valuation arrived at by the assessee. The Assessing Officer further held that no documentary evidence has been filed to justify the basis on which the premium is charged and, therefore, the assessee has totally failed to justify the charging of premium of Rs.37=5957 per share. Accordingly, the Ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hare capital, are LIC, Union of India, Oriental Bank of Commerce, Indian Overseas Bank and Canara Bank which are all public sector undertakings. Therefore, to raise eyebrows to a transaction where there is so much of involvement of the Government directly or indirectly does not make any sense. 10.1. No doubt a non-est company or a zero balance company asking for a share premium of Rs. 490/- per share defies all commercial prudence but at the same time we cannot ignore the fact that it is a prerogative of the Board of Directors of a company to decide the premium amount and it is the wisdom of the share holders whether they want to subscribe to such a heavy premium. The Revenue authorities cannot question the charging of such of huge premium without any bar from any legislated law of the land. Details of subscribers were before the Revenue authorities. The AO has also confirmed the transaction from the subscribers by issuing notice u/s. 133(6) of the Act. The Board of Directors contains persons who are associated with IDFC group of companies, therefore their integrity and credibility cannot be doubted. The entire grievance of the Revenue revolves around the charging of such of huge ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f necessary, appropriate directions to the authority against whose decision the appeal is preferred to dispose of the whole or any part of the matter afresh, unless forbidden from doing so by statute." 11.1. Considering the submissions of the Ld. DR in the light of the above ratio, let us test the transaction in the light of the provisions of Sec. 68 of the Act. As per Section 68 - the initial onus is upon the assessee to establish identity, genuineness of the transaction and the capacity of the lender or the depositor. The subscribers to the share capital are all companies. The confirmations of the transactions have been received by the AO by issuing notice u/s. 133(6) of the Act, therefore, identity has been established beyond all reasonable doubts nor the Revenue authorities have questioned the identity of the share holders. The genuineness of the transaction can also be safely concluded since the entire transaction has been done through the banking channels duly recorded in the books of accounts of the assessee duly reflected in the financial statement of the assessee. The bank statement is exhibited at pages 101 and 102 of the Paper book in which the transaction relating to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ities have erred in treating the share premium as income of the assessee u/s. 56(1) of the Act. In our considerate view, for the reasons discussed hereinabove, we do not find it necessary to apply the provisions of Sec. 68 of the Act. We, therefore, direct the AO to delete the addition of Rs. 47,97,10,000/-. Ground No. 2 & 3 are accordingly allowed." 9. We further find that the Co-ordinate Bench of the Tribunal in assessee's own case for assessment year 2010-11, in DCIT v/s Sembcorp Green Infra Ltd. (previously known as Green Infra Ltd.), in ITA no. 4409/Mum./2015, vide order dated 17/10/2017, by following earlier decision for the assessment year 2009-10, rendered similar findings. The learned D.R. could not show us any reason to deviate from the aforesaid decisions and no change in facts and law was alleged in the relevant assessment year. The issue arising in the present appeal is recurring in nature and has been decided by the Co-ordinate Bench of the Tribunal in assessee's own case for preceding assessment years. It is also to be noted that during the year under consideration, premium of Rs.37=5957 per share was collected in comparison to premium of Rs.490, per share and Rs.46 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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