TaxTMI 
TaxTMI 
2025 (11) TMI 1237
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....ce shares (CCPS) as under: (i) 50,000 equity shares amounting to Rs. 500,000/- (ii) 6,34,860 CCPS amounting to Rs. 63,48,60,000/- 3. HPPPL sold the shares to Peridot Power Venture Limited (PPVL), a group company, at cost. Subsequently, PPVL sold the shares of MHEPCL to M/s Hindustan Clean Energy Limited (HCEL), a group company, vide agreement dated 31.07.2018 (PG 69, PB) at cost. Thereafter, HCEL sold 49% of equity and 100% CCPS to an outsider, M/s. Devarsi Constructions Pvt. Ltd. (DCPL), at the nominal value of Rs.100/- only on the basis of valuation report dated 30.06.2020 (PG 91, PB) wherein the NAV of each share was determined at Rs -1.49 i.e. Nil. The transactions can be better explained with the following chart: HPPPL ⇩ PPVL (Group Co.) ⇩ HCEL (Group Co.) ⇩ DCPL (Outsider) 4. At the time of hearing, Ld. Departmental Representative (DR) of the Revenue brought to our notice brief facts relating to the issue involved as discussed above and also brought to our notice the findings of Ld CIT(A) and relied heavily on the assessment order. He emphasized that HCEL purchased the shares from M/s Peridot Power Venture Limi....
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.... held by Peridot Power Ventures Limited was taken by the assessee company on 31.07.2018. Moreover, it is worthwhile to consider that the cost of land acquired on 30.07.2013 at Rs.10.55 cr by MHEPCL must have increased manifold by this time (31.07.2018). Not only this, even the upfront fees premium, if project is taken in July 2018 could have been much more than Rs. 18 cr. Otherwise also the interest on Rs. 18 cr from 30.07.2013 to 31.07.2018 could have been much more. However, the Directorate of Energy, Government of Himachal Pradesh, vide letter dated 18.09.2019, had passed the termination order, cancelling the sanction of the government project to the MHEPCL. The Govt. neither refunded the upfront fees of Rs.18 crores plus interest nor reimbursed the cost of land acquired for this specific purpose for which litigation is going on in the High Court. Since the hydel project was stalled and the fact that the assessee company significantly lacked the technological and infrastructural facility to undertake any future projects, it decided to sell off the projects to the next market player in the energy sector in the relevant assessment year 2021-22. The land acquired for the purpose of....
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....eet of MHEPCL for AY 2019-20 and the same was reproduced at page 17 of his order. Ld. CIT (A) has extracted the share purchase agreement dated 31.07.2018 at pages 18 to 25 of his order. From the extracted share purchase agreement, he has observed and adjudicated the issues under consideration in the following paragraphs :- 10. It is seen from the above that the AO has not disputed the valuation of equity shares at Rs.(-)1.49 per share, though the same has been reproduced on page no.6 of the assessment order. It was emphasized by the ld. AR that the value of each equity share was nil being negative NAV. He further pointed out that the ld. DR has not objected to the sale price of the shares but has raised question on the purchase price. Since the purchase price was at cost, there could not be any objection to the same. Moreover, purchases were made in AY 2019-20, while the assessment was being framed for AY 2021-22. Once the purchase price was accepted by the Revenue in the AY 2019-20, the same cannot be disputed in AY 2021-22. Therefore, we agree with the ld. CIT(A) to his finding in para 'vii' on page 26 of the appellate order which is as under: "vii. From the a....
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.... findings of the Ld. CIT(A), we agree with his conclusions and hence hold that he has rightly came to the decision to delete the disallowance of long term capital loss. Accordingly, ground nos.1, 2 and 4 are hereby dismissed. 13. The other issue is regarding deletion of addition of Rs.1,43,55,000/- u/s 68 of the Income Tax Act, 1961 (for short 'the Act') as per ground no.3. 14. The brief facts on this are that on 30.06.2020 assignment agreement was signed with DCPL to assign the unsecured loan of Rs. 8,84,64,346/- to be received from MHEPCL by the company (PG 200, PB). The assignment was against a payment of Rs. 1,43,55,000/-. The AO has treated this amount as income from undisclosed sources u/s 68 of the Act. 15. The ld. DR relied on the finding of the AO and invited our attention to para 8.2 of the assessment order wherein the AO given his finding for addition u/s 68 as under :- "It is hard to believe that M/s Devarsi Constructions Private Limited has undergone the said transaction just to self-inflict/manufacture a loss of amount of Rs. 1,43,55,000/- within the period of 4 days followed by sale of such shares. It is safe to say, the amount of Rs. 1,43,5....