2016 (9) TMI 1459

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....ssing Officer made an addition of Rs. 90.18 lakhs towards share premium. According to the Ld. counsel, the addition was made under Section 68 of the Income-tax Act, 1961 (in short 'the Act'). The Ld.counsel further submitted that the assessee along with its subsidiary company entered into a new venture for generation of electricity from a type of grass which is renewable and sustainable as alternate source of power generation. Considering the future cash flow for this proposed project, the assesseecompany valued its shares based on discounted cash flow method. However, the Assessing Officer objected to this method of valuation on the ground that the future proposal and expansion of profitability are uncertain, which may or may not h....

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.... made by the Assessing Officer. 4. On the contrary, Dr. Milind Madhukar Bhusari, the Ld. Departmental Representative, submitted that the assessee in the guise of valuing the shares, which has the value of Rs. 10/- and market value of Rs. 171.34 per share, valued the same without any basis at Rs. 5400/- per share. The assessee-company introduced a share premium of Rs. 90.18 lakhs and share capital of Rs. 16.70 lakhs. This was the credit found in the books. After going through the balance sheet and other books of account, the Assessing Officer found that there was a credit to the extent of Rs. 90.18 lakhs towards share premium and share capital of Rs. 16.70 lakhs. The Ld. D.R. further submitted that there was no net worth in the assessee-c....

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....relevant material available on record. Admittedly, there was credit entry in the books of the assessee to the extent of Rs. 90.18 lakhs. The assessee claimed before the authorities below that Rs. 90.18 lakhs was a share premium. Apart from that, there was a credit of share capital to the extent of Rs. 16.70 lakhs. The assesseecompany further explained before the Assessing Officer by way of letter dated 25.03.2015 that a share premium of Rs. 64.26 Crores was received from Mrs. Vathsala Ranganthan. This was on account of transfer from M/s Shriram Auto Finance and M/s Bharat Wind Farm. Moreover, another share premium of Rs. 23.76 Crores was received on account of transfer of M/s Trilok Vincom Pvt. Ltd. from M/s VROne Energy Pvt. Ltd. The asses....