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TMI Blog2024 (12) TMI 103X X X X Extracts X X X X X X X X Extracts X X X X ..... 52, as certified by the auditors of the assessee company and as disclosed by the assessee in its return of income and further documents. It is the settled position of law that for invoking the provisions of section 263, there has to be some error in the order of the AO and the error should be of such nature that it would be prejudicial to the interest of revenue. Unless this twin condition is satisfied the provisions of section 263 cannot be invoked. In the case at hand we find from the records that the CIT has made certain factually incorrect observations while declaring the order of the AO as erroneous. However, the material on record would prove beyond doubt that the assessee has paid an amount of Rs 3282,98,42,109/- for acquiring total ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 17 declaring an Income of Rs 1277,69,64,410/- under normal provisions and deemed income u/s 115JB of Rs 537,41,47,069/- . While reviewing the Assessment Order, it is found that the order is erroneous insofar as it is prejudicial to the interest of revenue for the reasons enumerated below :- On perusal of the Assessment Order, it is noticed in financial statement that assessee had invested 328,29,84,000 equity shares of face value of Rs. 10 per share amounting to aggregate unquoted investments of Rs. 3282,98,40,000/- in its subsidiary company M/S Cisco Systems Capital India Private Limited . Further, it was noticed that pursuant to the share transfer agreement between Cisco Mauritius Inc and the assessee company, the assessee company had pur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for an amount of Rs328,29,84,000/- Assessee in order to support his submissions, has also filed the audited financial statement with its reply. Assessee further contended that provisions of section 68 read with 115BBE are not applicable to the facts of present case. 5 . The ld. PCIT after considering the reply of the assessee has observed that the assessee in this case has invested an amount of Rs Rs. 328,29,84,000/- for acquiring the 328,29,84,000 number of shares of M/s Cisco Capital. The ld. CIT further observed that the CISCO Inc was having only 252,41,61,440 shares of Cisco System Capital. The CIT further observed that the CISCO India was having total authorized capital of 256,00,00,000 shares. Therefore, the claim of the assessee tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y and documentary evidences filed before the ld. PCIT and pointed out that there is no error in the order of AO. He contended that the assessee has acquired 252,41,61,440 number of shares for an amount of Rs. 3282,98,42,109/- and hence the price value of the share was not Rs. 10/-, rather it was Rs. 13.52/- and the ld. PCIT while issuing the notice u/s 263 of the Act and while passing the order u/s 263 of the Act, made factually incorrect observations. 7. The ld. D.R. appearing on behalf of the revenue supported the order of ld. PCIT. 8. After considering the rival submissions, we observe that the assessee has entered into an agreement namely Share Transfer Agreement dated 14.7.2016 with its AE CSI, Mauritius and in clause 1.1, it is catego ..... X X X X Extracts X X X X X X X X Extracts X X X X
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