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TMI Blog2023 (11) TMI 851X X X X Extracts X X X X X X X X Extracts X X X X ..... EW DELHI [ 2020 (1) TMI 1022 - ITAT DELHI ] has concluded addition made by Assessing Officer on account of alleged excess share premium is unjustified when those very shares are sold in next financial year at much higher amount after proper due diligence, that to a non resident buyer and further there is no case of unaccounted money being brought in garb of stated share premium, hence, addition made u/s 56(2)(vii) of the Act is hereby deleted. Upon careful consideration, we find that the order of the Ld. CIT(A) was an ex-parte order. Moreover, the case law now referred was not put up before the authorities below. Hence, in the interest of justice, we remit this issue to the file of the Assessing Officer. The Assessing Officer sha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he basis of discounted cash flow method. The discounted cash flow method of valuation of shares was allowed to be used by Income Tax (15 Amendment) Rules, 2012 w.e.f. 29.11.2012. Therefore, the Assessing Officer held that assessee was not entitled to use discounted cash flow method at the time of first issue of shares i.e. 18.04.2012 for the purposes of section 56 of the IT Act, 1961. The Assessing Officer observed that the valuation report recommended the valuation of shares at Rs. 250.19 per share when it issued 57,910 shares. But the assessee used this valuation report for entire number of shares i.e. 1,50,775. The projections in the valuation were not found to be relist as the capital of the Assessee was only Rs. 5,79,100/-. There was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re Pvt. Ltd. simultaneously. The assessee company could not discriminate between the two. The Assessing Officer issued notice us 133(6) of the IT Act to the valuer Anand Dua, CA, Prop. M/s Anand Dua Associates. In a query asked by the Assessing Officer, he informed the Assessing Officer that the projections for period 2013 to 2018 were provided by the management of Clearmedi Healthcare. His scope of work was limited to compute price of equity shares as per the information submitted by the management. It was clearly stated that no comments are offered upon the accuracy, reliability and achievability of said business projections. 4. The Assessing Officer considered the reply of the assessee company and the report received from the valuat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n his computation the Assessing Officer found that the whole of the premium @ Rs. 250/- per share was based on incorrect report. He has, therefore, added premium paid by Clearview Healthcare Pvt. Ltd. amounting to Rs. 1,84,70,0007- to the total income. 5. Upon assessee s appeal, the Ld. CIT(A) confirmed the additions by holding as under:- 7.3. I have considered the facts of the case carefully. I agree with the Assessing Officer that provisions of section 56(2)(viib) of the IT Act are applicable in respect of the shares issued after 01.04.2012. It is immaterial that the money in this respect was received prior to this period. The other important factor is that Rule 11UA of IT Rules which existed on 18.04.2012 did not provide the use ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... valuing shares of said company, valuation was made of shares of instant assessee company (being underlying investment in hands of clearview healthcare pt ltd) @, 615 /share which is more than double of instant valuation of share @ 250 per share; is accepted as valid ground to delete the addition made u/s 56(2) (viib) we refer to para 3 5 of said order); notably seller of shares shashi baliyan (director of instant company) is assessed in India qua capital gains arising from said share sale @ 380.53 per shares. 8. Per contra, Ld. DR has relied upon the orders of the authorities below. 9. The Tribunal in ITA No. 2222/Del/2019, for Assessment Year 2014- 15 vide order dated 03.01.2020 has concluded as under:- 5.2 Keeping in v ..... X X X X Extracts X X X X X X X X Extracts X X X X
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