TaxTMI 
TaxTMI 
2025 (10) TMI 148
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....urn was e-filed by the assessee on 30.09.2015 showing total income of Rs. 7,990/-. The case was selected for scrutiny assessment through CASS under the category of 'limited scrutiny'. Notice under Section 143(2) of the Act was issued on 21.04.2016. Notice under Section 142(1) of the Act was issued on 24.07.2017 along with questionnaire. Learned Authorized Representative of assessee attended hearing and filed details/evidence to explain the return. On completion of assessment proceeding, Ld. AO vide assessment order dated 29.12.2017, made additions of Rs. 383,79,60,000/- Rs. 195,52,00,000/- and Rs. 89,29,195. 4. Similarly, in ITA No.572/Del/2019, Ld. AO vide assessment order dated 29.12.2017 made additions of Rs. 335,82,26,342/- Rs. 195,53,19,098/- and Rs. 69,81,290/-. 5. Against separate assessment orders dated 29.12.2017 of Ld. Assessing Officer, the appellant/assessee filed separate appeals before the Ld. CIT(A) which were dismissed vide separate orders dated 15.11.2018. 6. Being aggrieved, the appellant/assessee preferred present appeals, raising following grounds: 6.1 "Grounds in ITA No. 570/Del/2019: 1. That on the facts and in the circumstances of the cas....
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.... rejecting the scope of limited scrutiny having being expanded by the AO without prior permission is in violation of the provisions u/s 119 of the Act and the assessments is illegal and bad in law. 8. That the assessment framed by the AO and confirmed by the Ld. CIT(A) is unjust, illegal, arbitrary and excessive. 9. That the above grounds of appeal will be argued in detail at the time of hearing and the appellant crave leave to submit additional grounds of appeal, if any, and/or alter, verify, modify or rectify any grounds of appeal at or before the time of hearing. 6.2 "Grounds in ITA No. 572/Del/2019: 1. That on the facts and in the circumstances of the case the action of the Ld. CIT(A) to confirm the addition of Rs. 335,82,26,342/- made by the A.O. U/s 56(2) (vila) of the Act, on account of investment of shares of M/s. Bhartiya Hotels Limited through allotment is against the provisions of law and the addition made is arbitrary, excessive and illegal. 2. That on the facts and in the circumstances of the case the action of the Ld. CIT(A) to confirm the addition made by the A.O. of Rs. 195,53,19,098/- u/s 56(2) (vila) on account of investment ....
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....ter, verify, modify or rectify any grounds of appeal at or before the time of hearing." 7. Learned Authorized Representative for the appellants/assessee regarding grounds of appeal nos. 1 to 3 submitted that the assessee got allotment of shares of M/s. Bhartiya Hotels Ltd. and M/s. Dunlop Properties Pvt. Ltd. The case of assessee was not covered by the provisions of section 56(2)(viia) on allotment of shares through share application. In fact, section 56(2)(viib) of the Act was only applicable in circumstances where the receipt of consideration for issue of shares were involved. Circular No.3 dated 21.01.2019 was not applicable. Reliance was placed on paras 5, 11 and 17 to 19 of the decision in the case of "PCIT vs. Jigir Jaswantlal Shah". On merit, it was submitted that Assessing Officer had filed valuation report. Ld. Assessing Officer in para no. 12 on page no. 9 held the value of shares as negligible. In view of para 10 of decision in the case of Agro Portfolio Vs. PCIT. Ld. AO failed to reduce mortgage loan of ICICI Bank. Rule 11UA was not applicable. The apex Court in the case of Khoday Distilleries Ltd. vs. CIT & Anr. (2008) 220 CTR (SC) 228: (2008) 15 DTR (SC) 126: (2008....
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....had also purchased 2000000 shares of M/s. Dunlop Properties Pvt. Ltd @ Rs. 10/- per share which comes to Rs. 2,00,00,000/-, However fair market value is Rs. 1,97,52,00,000/-(@Rs. 987.60 per share). Difference of fair market value and total purchase consideration is Rs. 1,95,52,00,000/- which is far excess than rupees fifty thousand and as such this transaction is covered u/s 56(2)(viia) of the Act. Section 56(2) (viib) is applicable only in circumstances where the receipt of consideration for issue of shares is involved. In this case, appellant received shares for a consideration reported to be sub-par. So, only section 56(2)(viia) is applicable. 8.2 Learned Authorized Representative for the Revenue submitted that as per assessment order, since the sundry debtors of A.Y. 2014-15 had already been found to be fictitious and the sale of A.Y. 2015-16 was also not genuine as the very basic features of commercial activities are absent. Assessee has also failed to submit any evidence in support of his claim that the sale is genuine. Hence, Ld. CIT(A)'s decision confirm the addition of Rs. 8,92,915/-. Reliance was placed on order dated 09.05.2024 in ITA No.571/Del/2019 in the case o....