TaxTMI 
TaxTMI 
2026 (6) TMI 726
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....s. 3. The ld. AO has raised a solitary ground that the ld. CIT(A) has erred in holding that indexation benefit should be allowed from the FY 2008-09 even though occupancy certificate for township was issued during FY 2010-11 relevant to AY 2011-12. 4. for AY 2016-17 show that the assessee filed its return of income on 15.10.2016 at a loss of Rs. 87,53,78,625 which was assessed u/s. 143(3) r.w.s. 147 of the Act on 30.3.2022 determining total income of the assessee at NIL. The fact shows that assessee company was incorporated on 29.9.2008. Another company, DOMUS merged into the assessee company as per the Scheme of Amalgamation approved by the Hon'ble High Court of Karnataka as per Order dated 26.9.2012. The assessee company sold the immovable property being Township for a consideration of Rs. 75.50 crores on 23.6.2015. In fact, DOMUS constructed the Township during FY 2008-09 which was let out to GMR and rental income was earned from 15.11.2008 onwards. The above rental income was shown as income of DOMUS. This DOMUS is amalgamated with the assessee on the appointed date of amalgamation of 1.4.2010. When this property was sold, the assessee claimed long term capital loss of Rs....
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....lgamated with the assessee on the appointed date of amalgamation of 1.4.2010. When this property was sold, the assessee claimed long term capital loss of Rs. 31.94 Crores on the sale of Township and short term capital loss of Rs. 7.72 Crores, aggregating to total loss of Rs. 39.66 Crores for the impugned assessment year. The cost inflation index was applied from FY 2008-09 as since then the property was on rent to GMR. 10. There is no dispute on capital gain, but the only dispute is from which date the cost of indexation has to be taken. As in the hands of the assessee, the rental income is earned from 2008-09, therefore it is apparent that the property was in existence on that date. The ld. AO took the date of Occupancy Certificate issued by Gram Panchayat. Undoubtedly there is an amalgamation between the DOMUS and assessee company, therefore the transfer of asset from DOMUS to the assessee due to amalgamation is tax neutral. The period of holding is also required to be taken from FY 2008-09. 11. The ld. CIT(A) has dealt with the issue as under:- 4.3 Decision: The Assessing Officer converted the Long-Term Capital Loss claimed by the appellant into the Short....
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....g the claim of the assessee for granting indexation benefit from FY 2008-09. 13. Thus, the appeal filed by the ld. AO for AY 2016-17 is dismissed. 14. ITA No. 2098/Bang/2025 concerns AY 2022-23 and arises from the order of the ld. CIT(A) dated 30.7.2025. For this year, the assessee filed its return of income on 29.10.2022, and the assessment was completed under section 143(3) of the Act at a total income of Rs. 69,09,35,930. The disputed addition relates to the sale of units of Bharath Nirman Fund [BNF] to the assessee's subsidiary, Malkhed Real Estate Private Limited [MREPL]. 15. BNF is an Alternate Investment Fund [AIF]. On 15.6.2021, the assessee purchased 17,88,000 units from GMR at Rs. 83.89 per unit based on a valuation by SKA Business Advisory Services Pvt. Ltd., a registered valuer. Of these, 35,000 units were transferred on 30.9.201 to the assessee's subsidiary at a NAV of Rs. 20.77 per unit, as per another registered valuer's report. On this basis, the ld. AO treated the transaction as non-genuine and a colourable device and disallowed the assessee's claimed loss of Rs. 4,00,81,200. 16. Before the ld. CIT(A), the assessee contended that both the purchase and s....
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.... at Rs. 83.89 per unit and later sold them on 30.9.2021 to its subsidiary, MREPL, at Rs. 20.77 per unit, thereby claiming a short-term capital loss. At the time of purchase, the units were valued by SKA Business Advisory Services Pvt. Ltd., and at the time of sale, they were valued by Vikas Goyal. The ld. AO held that the acquisition valuation was based on the NAV method, whereas the sale valuation adopted the market approach. However, in para 4.3.1 of the order, the ld. CIT(A) specifically found that both valuations were in fact based on the NAV method, as noted from para 11 of the valuation report. He therefore concluded that the same valuation methodology had been applied at both stages. The Ld. CIT DR could not show us that there are different methods of valuation adopted by valuer at the time of sale and at the time of purchase. The ld. CIT (A) confirms that both are same. Although there was a significant difference between the purchase price and the sale price, the valuation report explained the reasons for the decline. The record also contains details of BNF's investments as on the dates of purchase and sale. The AIF reported a reduction of Rs. 57.79 crores in the value of i....
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....authorities C d Total (b+c) ₫ O e Balance (A-d) e 11593840 ៛ 30% of e r 3478152 & Interest payable on borrowed capital Cannot exceed 1.5 lacs if not Let out G h Total [+5) h 3478152 I Income from house property (c-h) i 2115688 Address of property Towa/ City Stale PIN CODE Is the property let out ? Name of Tenant PAN of Tenant (optional) 3 Annual letable value/ rent received or receivable . b The amount of real which cannot be realized b € Tax paid to local authorities c d Total (b + c) d D 0 Balance (a-d) c 0 C 30% of e r O g Interest payable on borrowed capital Cannotexceed 1.5 lacs if not Ict out & h Total ([+g) h D I Income from bouse property (c-h) . 0 Address of property Town/ City Stile PIN CODE Is the property let but ? Name of Tenant PAN of Tenant (optional) - Annunt letable value/ rent received or receivable . b The amount of rent which cannot be realized b C Tax paid to local authorities c P Total (b + c) d o c Balance (8 - d) € 0 r 30% of e [ 0 Document 2 4.6 Hence, the assets were put to use in FY 2008-....
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....sequently sold 6,35,000 units to its subsidiary M/s. Malkhed Real Estate Pvt Ltd at Rs. 20.77/- per unit in the same year and claimed Short Term Capital Losses. The AO in his assessment order has stated that the valuation reports done at two points of times at purchase and at Sales by SKA Business Advisory Services Pvt Ltd (SKA) and by Shri. Vikash Goel respectively are based on different valuation methods. Specifically, the AO stated that the valuation done by SKA is based on Net Asset Value method wherein the unit value was arrived at Rs. 83.99 per unit and the valuation done by Vikash Goel was based on Market approach and Cost approach wherein the unit value was arrived at Rs. 20.77 per unit. 4.3.1 It is seen from the submissions made that the Assessing Officer wrongly assumed that the valuation method adopted by Vikash Goel as Market and Cost approach. From the valuation report, it is seen that the valuation method adopted is NAV and not otherwise. The relevant paragraph 11.0 is reproduced below: "11.0 Valuation Rationale Based on our discussions with the management, we noted that: · The Fund has its investments in Equity share and Share Warrants of underlying....
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....valse Is Equity Dans Ape FeoneK Zones Lud 9 11,00.000 M VIOM Intre Verres DFormerly Quepe Infrastructure 1.maod/ Quopo Conspusten NG 1,10.000 111,20,200 Tachva Vilken Pv lad (Finnerty Quepo Vaken 54 2.00,000 :54 M M 5 Jus Toll Road Cangeny Landed + · 2 Preference Takoon indasQuiture PM Lol Que ThỠdương báM N 0 Datbrettahol Por Lipped g 1.000 01 M g C. Sevus Pigmars Putt se Angers Nattrg Posts ¥ 10 1 Avtal Marsone joh penichet Dels; Pvt LNd 10 De a 10.005 p Senaura Poeng Linend Former Quepo 2 - Sub Total (A) 25,02.11.141 25,08,18.941 6,00,900 Je Pay & avere Bars Sue Toww [D 100,000 Is warDwie Best lerin Labs Point 100,00,100 1,00,00,000 Coast Teund (A+B+C+Dy Total lanestineel 1,00,60,000 Here, the variation in quantity is due to purchase of Rs. 10,00,000 warrants in Attivo Economic Zone Ltd for Rs. 1,00,00,000. Price Variance The details of difference in fair value as on 31.03.2021 and 30.09.2021 is provided hereunder: Particulars Amount Reduction in value of investments (57,29,61,850) Increase in value of Investments 6,14,44,8....
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....số Nenech Perk Pot Lad 40,00-000 Sub Total (B) Is warrua Baril Imenom Labs Pot Lad NIL 15.98,851 O Eglin (7 Activo economic Zare Lid 50,00,000 10 15.00,00,000 1,50.00.000 6 10,00,000 Artral Martine loty DÆ°á»ng Put 10 5,00,00,000 13 3,00,00 008 Suta Adruon Lamind (Som ktutratas Advion Lad) 1490,000 10 100,00 0CC 12,00.000 NOM bất Ventures (Quippe Labasteacher [ad) K 15,00.00,000 1.50,00.000 $ 14.49.71 51: · Sub Total (C) 36.00.00.000 50,22,439 (35,49,77,571) In Mutual Funds 1CDCI Pradescal Money Market Fund 11 52.99,264 XCICI Prudential Liquid Fand 12,507 IC Sub Total ( D) 2,25,37,564 68.91,720 Grand Total (A+B+C+D)Total lovevineet 68.52.53,945 17J136.516 (51,15.16.959 Document 5 Explanation 1 : Attivo Economic Zones Ltd (AEZL) [Equity and Warrants] AEZL does not have any major revenues. Majority of AEZL's funds are deployed in Investments in Attivo Economic Zone (Mumbai) PVt. Ltd [~INIR 84.53 Crore], Attivo Economic Zone (Kolkata) Pvt. Ltd [~INR 5.01 Crore], Capital Work in Progress [~INR 61.87 Crore] and Loans and Advances [~INR 63.36 Crore]. We did not have access to audited financial stateme....
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....ty Sherm [30%) 2.50,000 The NAV is negative, and no vilje is ertitied by the storehaiders. 21.719 Equity Shares [40%) 40.00,000 1.54/00,000 Preference Shares 21,00,30.000 205.66.300 Significare less in PY 2021; Credit ratings have declined [8se- from Care Ratings in Dec 201, Major assets includes untitled Revenues and income ter refund withheld. Shareholders: funds include DVR: 35 Croce Stres asued. Only a portion of Preference Share Hooters to be reciveratte Quippo Energy Lad Comments Compulsory Convertible Debentures 12,50,00,000 NB: CCD Convertible into OCP'S after 5 yrs. (2024), OOPS will be either redeemed 9 99 25 ar servertes ite forty (1 1) at the ogion of issuer efter 4 years. No plausibility of money accruing to Viom here. 10,00,000 Share Warrants 20,00,00,000 12.80,51,794 Based on NAV calculation Mal Vehicles & Technologies Pvt Lät Comments: Total 59,00,50,000 15,04,18,004 Explanation 2: Viom Infra Ventures Lid ("Viom" or "VIVL") [Equity & Warrants] has toutly banenchil mumserste of VIVI (Formerly, Quippo Infrastructure Lid, and The fund Nas 100 percent Equity benefichet verste cadaet Chermery Cutremurvi, at a cont of onement Lnd: ya v) Based on the fi....
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....(Fair Value) - attributable to Equity Shareholders (3,04,91,94,000) Number of Equity Shares (Units) 2,00,000 Value per Share (15,245.97) Explanation 4: Prasandi Infotech Park Pvt Ltd ("Prasandi" or "PIPPL") [Equity] The fund has Equity investment in PIPPL by way of holding 90,00,000 Equity shares of PIPPL at a cost of ~INR 7.00 Lakhs. Based on the provisional financial statements made available to us, and on perusal of the investments of PIPPL, PIPPL has been reporting losses and has negative net worth in PY 2021. PIPPL has investments in Mutual Funds. In the absence of Holding statement or details of portfolio, we have taken the same as per book values. PIPPL has a land and we have received an independent valuer's report dated 29 March 2017. While the report is out-dated, we have considered the Fair Value as mentioned therein. We have not verified the title of such land as it is outside the scope of our engagement. Since the company is having negative NAV but TAIML already have a 50 lakh sale agreement, therefore, we have recorded the investment at book value. Particulars Amount (INR) Total Assets 1,80,41,93,673 Less: Outside Liabilities 2,36,37,33,777 Net....
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....91,77,457 Weighted Value of Equity 5.49,45,574 Number of Shares 10,00,000 Value per Share 54.95 Explanation 6: Bengal Industrial Infrastructure Pvt Ltd ('BIIPL") [Equity] The fund has 99.97 percent Equity investment in BEIPL at a cost of ~INR 2.75 Crore. Based on the provisional financial statements made available to us, BITPL has a secured loan of -INR 23.83 Crore and has given an Unsecured Loan/Advance of -INR 27.49 Crore. Particulars Amount (INR) Total Assets 27,56.09.287 Less: Outside Liabilities 25,23.26 532 Net Asset Value 2.32.82,756 Number of Equity Shares (Units) 27,50,000 Value per Equity Share 447 Explanation 7: Goldensons Construction Pvt Ltd ('Goldensons" or "GCPL"] [Equity] The fund has 100 percent Equity investment in GCPL at a cost of ~[NR 1 Lakh. Based on the provisional financial statements made available to us, GOPL has a secured loan of -INR 56.66 Crore. It has an investment property of -INR 27.64 Crore (Land and flat) that has been hypothecated against loan; loans advanced of ~[NR 19 Crore and Investment in perpetual bonds of Srei Infrastructure Finance Ltd (SIFL) of -INR 10 Crore which has been hypothecaced against loan f....
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....per Equity Share -1.16 ca Metal Auser's Amount (EUR) (24.59,354) Number of Equity Shares (undts) Value per Share 40,000 (265.94) Explanation 11 Chaitanya Vincom Pvt Ltd ("Chaitanya" or "CVPL"] [Equity] Thẻ fund has Equity investment in CÆ¡tre, by way se nonding 3.000 Pouty unies at & Coik of ENF 50,000. =========== hes negative net worth in PY 2021. CVP, has taken a loan of -[NA 94 Crore. Lied for granting loan of Ra. 75 crores to Danes Construction Pille Ursend, As. 94.90 ordres to Istat Ericleve Private Limited and Ra. 95 crore to Telo Nieman Private Limited Explanation 12 Danvir Construction Pvt Ltd ("Danvir" or "DCPL") [Equity] Ras negative net worth in PY 2021 and PY 2020. OCH, has taken à loan Äể -[NB 96 Crore. pues ca par domet north -INR. 1L2 Crore consisting of Land (-[NR. 90 26 Crore), Finance Cost (~INAL. 34.79 Crore) among others. As per nonmi to printsonal financial statements, During FY 2021, DCPL has entered into sale agreement for sale of project land (inchted in inventory) of Though the Net asset value of the company is negative, TAIML a expecting some return on the wweitment. Therefore, we have considered th....
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....did we get any reasonable indication of future forecasts. Accordingly, we have valued BCL based on Cost Approach. We have also received a Valuation Report of BSPPL from a Chartered Accountant, CA Ani Malani, as on 31* October, 2021 (after the valuation date as per thes report) with the valuation of BSPPL, under Rule 13UA of the Income Tax Rules, The report is dated 3" January 2022. While the valuation is after the valuation date as per this report, based on the discussion with the investment manager, we have taken the value based on the CA's valuation report as on 31" October, 2021. Explanation 16 Anupatra Building Pvt Ltd ("Anupatra" or "ABPL") [Equity] The fund has 100 percent effective ownership in Anupatra Building Pvt Ltd at a cost of ~INR 10,000. Based on provisional financial statements of PY 2021, ABPL has reported negative Net Worth in FY 2021 and PY 2020. ABPL has Borrowings of ~INR 150.46 Crore. It also has investments in Futuristic Steel Ltd [INR 103.62 Crore] and Ganga Power and Natural Resources Ltd [INR 45 Crore]. As per notes to PS. "(a) The Long-term Investment is the Purchase consideration paid to a Financial Institution for assigning to the Co....
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....nt, Though the value per warrant and Equity Shares is positive, as per the discussion held, SIFL had assigned loans to Aviral Maritime for developing Sterling SEZ. Sterling SEZ is now under liquidation. Based on the discussion with Investment Manager and our understanding of the company, the value in the company has been eroded. Accordingly, we have valued the investments as NIL. Particulars Amount (DER) Total Assets 166,06,248 Less Outside Labiites Het Asset Valve (Book Value) 96.000 1,65,10,248 Adjustment for changes in valve of investments Net Asset Value (Fair Value) 44,65.390 1,00,44,858 Number of Equity Shares (Including Warrant conversion) (units) 20,00,000 Value per Equity Share / Warranta 5.02 Explanation 19 Satta Advisors Lid ("Satta" or "SAL") [Equity & Warrants] The fund Nas 100 percent effective ownership in Satta Advisers Ld (formerly, SREI Infrastructure Advisors Linf) at a cost of -INR 1 Crore. The fund has also invested IN 1 Crore in SAL'S warrants. SAL has invested IN 1.53 Creve in equity of Viman Capital Ite. Lidl, Singapore ("Viman'). We have received the provisional financial statements of Viman and have considered it Net Asset Value ....