2024 (10) TMI 356

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....unds of appeal raised by the assessee are as under: "1. The order of the learned Principal Commissioner of Income Tax is opposed to law and the facts and circumstances of the case. 2. For that in the facts and circumstances of the case, the Ld. PCIT. erred in violating the principles of natural justice by not the mentioning the specific grounds for initiating action u/s 263 of Income Tax Act, 1961 in the show cause notice issued. As such, the order passed u/s 263 is void ab-initio. The action of the Ld. CIT was wholly unreasonable, uncalled for and bad in law. 3. For that in the facts and circumstances of the case, the Ld. PCIT erred in not passing a speaking order against all the submissions of your appellant. As....

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....unal be pleased to allow the appeal and render justice." 3. The assessee, private limited company has issued compulsory convertible preference share of Rs. 100 Cr. on 16.01.2018 under private equity category, contributed by ICICI venture through India Advantage Fund S4-I. The shares were issued at price of Rs. 416.69 per share against the Fair Market Value of share of Rs. 414. The Assessing Officer in assess passed under section 143(3) after verification has not made any addition u/s 56(2)(viib) for difference in issue price and FMV of shares. The Ld PCIT has held the order erroneous and prejudicial to the interest of revenue and set aside the assessment order. The Ld PCIT has held that the A.O has not made complete verification and inqu....

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....1UA. The Ld. AR has submitted that though Rule 11UA has been inserted w.e.f 25.09.2023, it has been held by Hon'ble ITAT, Delhi Bench in ITA No.8289/Delhi/2019 dated 16.04.2024 that the Rule is to be treated as retrospective. The Ld. AR has further submitted that earlier there was no provision to value the compulsory convertible preference shares and the valuation of compulsory convertible preference shares has been brought in only w.e.f 25.09.2023 and therefore, section 56(2)(viib) has no application in such share. 5. The Ld. CIT-Departmental Representative (DR), on the other hand, relied on the order passed by Ld. PCIT. 6. We have heard the rival submissions, and perused the materials available on record. The assessee has issued com....