https://www.taxtmi.com/caselaws?id=456931 ITAT Delhi dismissed Revenue's appeal challenging CIT(A)'s order on share valuation under section 263. The case involved determination of fair market value of shares issued at premium to existing promoters and shareholders. The assessee adopted Discounted Cash Flow method under Rule 11UA, which ITAT held was permissible as assessee has option to choose between NAV or DCF method. AO's valuation was flawed due to mathematical errors including incorrect face value computation of convertible preference shares at Rs. 10 instead of Rs. 100. After corrections, minimal variation existed between assessee's and AO's valuations. ITAT ruled that once proper valuation method is adopted, AO cannot question valuation without establishing perversity in method. en-us Fri, 21 Jul 2023 00:00:00 +0530 Sat, 24 Aug 2024 11:01:09 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=456931 ITAT Delhi dismissed Revenue's appeal challenging CIT(A)'s order on share valuation under section 263. The case involved determination of fair market value of shares issued at premium to existing promoters and shareholders. The assessee adopted Discounted Cash Flow method under Rule 11UA, which ITAT held was permissible as assessee has option to choose between NAV or DCF method. AO's valuation was flawed due to mathematical errors including incorrect face value computation of convertible preference shares at Rs. 10 instead of Rs. 100. After corrections, minimal variation existed between assessee's and AO's valuations. ITAT ruled that once proper valuation method is adopted, AO cannot question valuation without establishing perversity in method. Case-Laws Income Tax Fri, 21 Jul 2023 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=456931