TaxTMI 
TaxTMI 
2024 (8) TMI 545
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.... filed an application dated 30.10.2023 seeking condonation of delay in filing of appeal. No serious objection was raised by the ld. Counsel of the assessee on condonation application. We have examined the said application. On perusal of the same, we find that the delay in filing of appeal was not intentional, but was for bonafide reasons explained therein. The delay in filing of appeal is condoned and the appeal is admitted for hearing on merits. 3. The Revenue in appeal has assailed the order of CIT(A) on following two grounds:- 1. Whether on the facts and circumstances of the case and in law the ld. CIT(A) has erred in deleting the disallowance of Rs. 3,95,014/- made on account of proportionate interest expenditure. 2. Whether on the....
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....re adopting Net Asset Value (NAV) method. He submitted that in the first instance the shares issued by the assessee were at lower value than the market value determined by the AO. The shares were issued at Rs. 4272.31 and the fair market value of shares according to the AO was Rs. 7426/-. Thus, the provisions of section 56(2)(viib) of the Act are not attracted. Secondly, the AO could not have changed the method of valuation. The DCF is one of the approved method and is in accordance with Rule 11U & 11UA of the Income Tax Rules, 1962 (in short 'the Rules') 6. We have heard the submissions made by rival sides and have examined the orders of authorities below. The AO had made addition on two counts: (i) Excess payment of interest Rs. 3,95,....
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....V method for valuation of shares and computed the valuation of shares at Rs. 7426/- per share. Thus, he made addition of Rs. 25,09,76,959/- . 9.1. A bare perusal of provisions of section 56(2)(viib) would show that, if shares are issued on a rate exceeding the face value of such shares and the aggregate consideration received on such shares exceeds the market value of the shares, the amount that exceeds market value shall be chargeable to tax under the head 'Income from other sources'. In the instant case, the assessee had issued shares having face value of Rs. 10/- per share at a premium of Rs. 4262.31 per share as against the market value of shares determined by the AO adopting NAV method Rs. 7426/- per share. Thus, the provisions of sec....