TaxTMI 
TaxTMI 
2015 (10) TMI 2304
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....transaction are not frère from doubt and thereby disallowance as made by the A.O. in respect of loss Rs. 4,47,55,491 under the head 'capital gains' is wrong in accordance with the law. 4) The Learned CIT(Appeals) has erred in not appreciating that the value of shares has been computed by the valuer by applying one of permissible method of valuation under the Income-tax." 2. We have heard and considered the arguments advanced by the parties in view of orders of the authorities below, material available on record and the decisions relied upon. 3. The issue involved in the above grounds is as to whether the Learned CIT(Appeals) was justified in upholding the disallowance of Rs. 4,47,55,491 claimed in respect of loss under the head "capital gain" treating the transaction doubtful. 4. The relevant facts are that during the year, the assessee company was engaged in the business of investments and purchase/sale of land and immoveable property. Apart from business loss, the assessee had also disclosed loss from capital gain in the return of income. The assessee claimed capital loss of Rs. 5,21,22,725. The Assessing Officer required the assessee to furnish complete details of sh....
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....loss accrued due to indexation was allowed by the Assessing Officer. In respect of shares of Pioneer Ltd., the Assessing Officer observed that the assessee had purchased these shares, having face value of Rs. 10 at a premium of Rs. 30 and the total cost of acquisition was Rs. 40 per share. The Assessing Officer further observed that the assessee had sold these shares @ Re. 0.10 to the purchaser and has incurred loss. 6. Regarding the doubt expressed by the Assessing Officer on the genuineness of the transaction of shares of Pioneer Ltd., on the basis that the assessee could not produce the complete balance sheet of Pioneer Ltd. and the papers submitted were not signed by the Auditors or by the Directors of the Company, the Learned AR submitted that it is not correct as complete documents were filed by the assessee as it is evident from the submissions of the assessee before the Learned CIT(Appeals), a copy thereof has been made available at page No. 1 to 10 of the paper book. 7. Regarding the observation of the Assessing Officer that the book value of the shares as shown by Pioneer Ltd. is Rs. 3.50 per share, the Learned AR submitted that the Assessing Officer has failed to compu....
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....submitted that the Learned CIT(Appeals) has compared the working of the Assessing Officer and assessee vis-à-vis computation of long term capital loss and after analyzing the working of the assessee and the Assessing Officer, it was observed that difference in sale consideration as per Assessing Officer and assessee is only Rs. 34 lacs. However, instead of making any separate addition of Rs. 34 lacs on account of alleged under valuation of shares, the Learned CIT(Appeals) has sustained the entire loss as computed by the Assessing Officer. 11. The Learned AR further submitted that the Assessing Officer has accepted the sales consideration received by the assessee as genuine as it is evident from the fact that while computing the income of the assessee, the Assessing Officer has adopted the net figure of loss as computed by the assessee in its computation and no separate addition of Rs. 1 lac has ever been made. Thus the Assessing Officer and Learned CIT(Appeals) both have accepted the sales consideration figure. 12. The Learned AR submitted that report of valuer is an important piece of evidence and the same cannot be discarded without their being any cogent material on rec....
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....of shares Amount Indexed cost Date of sale Sale consideration Profit/(loss) The Pioneer Ltd. 30,03,2007 10,00,000 4,00,00,000 4,48,55,491 07.02.09 1,00,000 (4,47,55,491) Ultima 01.12.2005 7,50,000 75,00,000 87,82,696 07.02.09 75,00,000 (12,82,696) Solaris Holding Ltd. 16.01.2007 5,00,000 5,00,000 5,62,09,538 72.02.09 5,01,25,000 (60,84,538) 17. The Assessing Officer accepted the claimed loss regarding the shares transaction of Ultima and Solaris Holdings Ltd. but did not accept the claimed loss on sale of shares of the Pioneer Ltd. The Assessing Officer doubted the genuineness of the claim on the basis that the assessee could not produce the complete balance sheet of Pioneer Ltd., the papers submitted were not signed by the auditors or by the directors of the company, the book value of the shares as shown by Pioneer Ltd. is Rs. 3.50 per share and hence the price claimed to have been received by the assessee is not acceptable. In its submissions before the Learned CIT(Appeals) and the ITAT, the assessee has tried to meet out these objections of the Assessing Officer by the submissions that the Assessing Officer had disallowed the loss ignoring the docum....