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TMI Blog2024 (7) TMI 1231X X X X Extracts X X X X X X X X Extracts X X X X ..... (A) has only endorsed the reasoning of the AO for not accepting the valuation report. Thus, we consider it an appropriate case to allow the ground of the assessee for statistical purposes and restore the issue with regard to the claim of the assessee to be exempt from applicability of section 56(2)(viib) of the Act, as a start up to the files of the AO. The AO shall take into consideration the aforesaid findings and evidences filed and further give opportunity of hearing on this issue, to the assessee. Accordingly, the appeal is allowed for statistical purposes. - Shri G.S. Pannu, Hon ble Vice President And Shri Anubhav Sharma, Judicial Member For the Assessee : Shri Brij Mohan Barwal, CA For the Revenue : Shri Amit Katoch, Sr. DR ORDER P ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erence between the projected and the actual revenue. Secondly, the AO considered the net asset value approach to arrive at the fair market value of the shares and the difference between the fair market value as per net assets method and the issue price was considered to quantify the addition. 3. In appeal before the CIT(A), the assessee claimed that the assessee is registered under DIPP vide Notification No. DIPP10923 and, therefore, was exempted for the purpose of clause 56(2)(viib) being a start up. The assessee claimed that this DIPP recognition certificate was produced before the AO, but, was not considered. 3.1 The assessee, then, claimed that there was no justification of comparison of provision with actual results and its deviation c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s bad in law being the assessee is registered under DIPP. 2. The impugned order passed by Ld. Asst. Commissioner on the basis of set aside the projections used for valuation purpose is bad in law. 3. In the impugned assessment order, the Ld. Asst. Commissioner sets aside the method of valuation used by the Independent Valuer in its valuation report and used a different method on his wish and whims. 4. The Ld. A.O has made error in discarding the valuation report without verifying the base or real facts of the data. 5. Addition made by the Ld. A.O. based on his valuation method is bad in law and not sustainable. 6. The assessee company issued the shares to non-resident, investors on the same price the price at which the shares are issued to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of the preceding financial year, and (iii) the startup has obtained a report from a merchant banker specifying the fair market value of shares in accordance with Rule 11UA of the Income-tax Rules, 1962. (2) the application for approval under this para shall be made in Form-2 to the Board and shall be accompanied by the documents specified therein. (3) The Board may, after calling for such documents or information and making such enquiries, as it may deem fit, (i) grant approval for the purposes of clause (viib) of sub-section (2) of section 56 of the Act, specifying the relevant details, including details of investor, amount of premium on which shares are to be issued, and the latest date by which the shares are to be issued; or (ii) decl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it is issued for a period of 10 years from the date of its incorporation/registration. 7. The ld. DR, on the other hand, has relied the orders of the ld. tax authorities below. 8. After taking into consideration the order of the CIT(A), it comes up that in spite of the assessee taking a specific plea of being exempted as a start up from the application of clause (viib) of sub-clause (2) of section 56 of the Act, no findings was given to reject this claim. The CIT(A) has only endorsed the reasoning of the AO for not accepting the valuation report. Thus, we consider it an appropriate case to allow the ground No.5 of the assessee for statistical purposes and restore the issue with regard to the claim of the assessee to be exempt from applicabi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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