SHOT FORMATS DIGITAL PRODUCTIONS PVT LTD,MUMBAI vs. DCIT CIRCLE 16(1), MUMBAI

On the fact CIT(A) erred premium rece to Rs. 14,99, Income Tax A 2. On the fact CIT(A) and th furnished any to share prem the previous y 3. On the fac CIT(A) and th justification f 14,99,57,141 previous year 4. On the fac CIT(A) and th failed to prov Matrix Partne shares were a 5. On the fac CIT(A)and the transaction of extent of sha the genuinen shares of Rs. 6. On the fac CIT(A) has g introduced its share premiu to the entity tax haven cou 7. On the fac CIT(A) and th transaction of sham transa remainder pa shares Rs. 4 Shot Formats D ts and circumstances of the case and in in confirming the action of the Ld. AO eived on issuance of shares by the Appel 57,141/-, as unexplained cash credit u/ ct, 1961 ('Act'). ts and circumstances of the case and in he Ld.AO erred in holding that the Appel y documentary evidence or confirmation, mium amounting to Rs. 14,99,57,141/-rec year 2012-13. ts and circumstances of the case and in he Ld. AO have erred in holding that th for receipt of share premium amoun /- on issue of shares by the appellan r 2012-13. cts and circumstances of the case and in e Ld. AO have erred in holding that the a ve identity and creditworthiness of the th ers India Investment Holdings II, LLC t allotted in previous year 2012-12 cts and circumstances of the case and in e Ld. AO erred in doubting the genuine of issue of shares of Rs. 15,00,00,001 are premium of Rs. 14,99,57,141/-, with ness of the remainder amount being fa 42,860/-. cts and circumstances of the case and in grossly erred in concluding that the ap s own unaccounted money of Rs. 14,9 m solely for the reason that shares have incorporated and registered in Mauritius untry. cts and circumstances of the case and in he Ld AO have grossly erred in conclud f receipt of share premium of Rs. 14,99 action whilst accepting the genuinen art of the same transaction i.e. receipt of f 42,860/-. igital Productions Pvt. Ltd 2 law, the Ld. O in treating llant, totaling /s 68 of the law, the Ld. llant had not with regard ceived during law, the Ld. here was no nting to Rs. nt during the n law, the Ld appellant has he allotee i.e. to whom the n law, the Ld eness of the only to the out doubting ace value of n law, the Ld ppellant has 99,57,141 as been alloted s which is a n law, the Ld ding that the 9,57,141 is a ness of the face value of 2. At the very out counsel for the asses noting a delay of 209 learned counsel drew condonation of delay 2.1 In the said aff explained that she managing the affairs being a single moth child, she was comp and specialised train Dehradun in March 2 coupled with her pe attention to the routi 2.2 It was further su fide belief that the ap or through e-mail, an been uploaded on the 2.3 Further it is su the assessee had fil Court but there also disposed off. The as appeal only on 20.12 Shot Formats D tset, our attention was invited ssee to the defect memo issued 9 days in the filing of the pres w support from the assessee’s , duly affirmed by an affidavit. fidavit, the Director of the ass has, for several years, been t s of the company. She further er entrusted with the care of pelled, owing to exigencies of h ning requirements, to relocate f 2024. It was stated that this un rsonal responsibilities, resulted ine administration of the compa ubmitted that the assessee harb ppellate order would be served e nd was unaware that the impu e portal. ubmitted that for early disposa led writ petition before Hon’ble o it was not intimated that ord ssessee came to know of the 2.2024 upon receiving an e-mail igital Productions Pvt. Ltd 3 by the learned by the Registry sent appeal. The application for sessee-company the sole person r deposed that, a special-needs her son’s health from Mumbai to navoidable shift, d in diminished any. boured the bona either physically ugned order had al of the appeal, e Bombay High der was already disposal of the l from the ACIT,

Since 2019 by Ms Niyate had more th promoters/ ke company is m 7. Ms Shah, a diagnosed wi sports. She h 2024, to provi personal atte training well b (i) Septembe Championship (ii) October 2 Equipped Pow (iii) November deadlift, and Powerlifting C (iv) December Championship 8. Ms Shah's intense traini her shifting t minimal inv Company's a monitored and 20th Decemb Appellant abo the impugned 9. Within 10 knowledge, th B. The Appell would be dis Appellant, ph unaware abo 20th Decembe 10. The App proceedings submissions, Shot Formats D

The Appe would be disp on the Appel initial period Appellant wa served by up serving a copy dated 21st M only 20th Dec 12. Infact, the 2024, filed ap appeal [Copy As the Appel even filed a Bombay High High Court vi dated 18th N disposed off (Appeals) to d further extens Writ Petition, Appellant tha 13. Thereafte Hon'ble Bomb with the N Juri ictional Thereafter, on mail from ACI "As per the inf appeal of M/ 2013-14 has Copy of order Exhibit C. 14, Thus it i became awar was disposed accessed its March 2024 p 15. The Appe communicatio Tax Departm Shot Formats D ellant was under a reasonable belief that posed off by serving a physical copy of llant, or by serving a copy over e-mail. of the operation of the Faceless Appeal S as unaware that the Appellate Order ploading it on the portal, and not by y of the order on the Appellant. The impu March 2024, came to the knowledge of th cember 2024. e appellant had, on 21 February 2024 an pplications with the NFAC for early disp of these letters are enclosed herewith as llant did not receive any response, the Writ Petition No. 4725 of 2024 before t h Court on 01 October 2024. The Hon'b ide order dated 18th November 2024 [Co November 2024 is enclosed herewith as the petition with a direction to the Co dispose of the appeal within 3 months w sion. Though the Revenue was represe it was never brough to the notice of the C at the appeal was disposed off. er, the Appellant served the certified c bay High Court's order dated 18th Nove National Faceless Appeal Centre as l Assessing Officer on 19th Decem n 20th December 2024, the Appellant rec IT, NFAC, wherein it was stated that: nformation received from ITBA team (DG S /s Shot Formats Digital Productions Pvt been disposed off on 21.03.2024" r dated 18th November 2024 is enclosed h is only on 20 December 2024, that the re that the appeal before the Commissione d off on 21 March 2024. Thereafter, the e-filing portal and downloaded the orde passed by the NFAC u/s 250 of the Act. ellant states and submits that it not re on through e- mails or whatsoever from ment that its appeal for AY 2013-14 igital Productions Pvt. Ltd 6 t the appeal f the appeal . Being the Scheme, the r would be physically ugned order e Appellant d 24th July posal of the s Exhibit A). e Appellant the Hon'ble ble Bombay opy of order s Exhibit B] mmissioner without any nted in the Court or the copy of the ember 2024 s well as mber 2024. ceived an e- System), the Ltd for AY herewith as e Appellant er (Appeals) e Appellant er dated 21 eceived any the Income had been disposed off. multiple times file writ petitio 16. The appe filing the pres facts narrated 4.2 In the present c detail, circumstance Director, being a sin intensive sports an relocate, thereby seve administrative affair bona fide but mistak of orders under the n 4.3 It further eme diligently pursuing disposal and even ap way of a writ petition before the High Cou brought to the Cour The fact that the ass e-mail received on Revenue has filed assertions. Shot Formats D f. That is the reason the Appellant fo s for early hearing of appeal as well as to on before the Hon'ble Bombay High Court llant humbly requests that the delay of 2 sent appeal may be condoned having re d above and bonafides of the appellant. case, the assessee has set out, s which convincingly explain ngle parent to a special-needs c nd therapeutic training, was erely limiting her involvement in rs. The affidavit also narrates ken belief regarding the mode of nascent Faceless Appeal Scheme erges that the assessee had, the matter by filing applica pproaching the Hon’ble Bombay n. Significantly, despite Revenue urt, neither was the disposal rt’s notice nor communicated t sessee came to know of the orde 20.12.2024 stands uncontro no counter-affidavit disputin igital Productions Pvt. Ltd 7 ollowed up ook pains to t. 22, days' in egard to the in considerable the delay. The hild undergoing constrained to n the company’s the assessee’s communication e. in fact, been ations for early y High Court by e’s participation l of the appeal to the assessee. er only upon an overted, as the ng the factual

4 The appeal was knowledge of the im the bona fides of the 4.5 In view of the explanation furnishe demonstrates sufficie satisfied that this is substantial justice. A and condone the de 4.6 The appeal is th merits. 5. We have careful material brought on assessee filed its retu income of ₹7,62,78 12.03.2015 to ₹2,11, and during the cours unable to satisfactori share premium of incorporated in Maur 5.1 The Assessing O the investor-company Shot Formats D filed within ten days of the ass mpugned order. Such prompt a explanation. e foregoing discussion, and n ed by the assessee remains u ent cause within the meaning s a fit case where technicalitie Accordingly, we accept the expla lay in filing the appeal. hus admitted and taken up for lly heard the rival submissions a n record. The factual matrix r urn of income on 30.09.2013 d ,710/-, which was subsequen 76,330/-. The return was select se of assessment proceedings, th ily demonstrate the justification f ₹3,45,987.67 per share fr ritius. Officer recorded that the financi y were not furnished, nor was th igital Productions Pvt. Ltd 8 sessee acquiring action reinforces noting that the unrebutted and of law, we are s must yield to anation tendered adjudication on and perused the reveals that the declaring a total ntly revised on ted for scrutiny, he assessee was n for receipt of a rom an entity al statements of he assessee able to substantiate, throu at such an extraord Flow (DCF) Method held that the assesse the identity, credi genuineness of the section 68 of the Act, amount. The releva reproduced as under “4.15 On the various decis only conclusio i. That the bu has to be on t ii. If the cash Officer is justi The assessee by the lender, iv. The genu account has t v. If the expla evidence, th 68 can be in 5.2 The learned CIT with the findings of noted that despite m and remand proceed cogent explanation Shot Formats D ugh any credible material, the b dinary valuation under the Di or otherwise. The Assessing Of ee had failed to discharge the bu itworthiness of the subscri transaction, and invoked the , making an addition of the imp ant observation of the Asses : basis of the language used under sectio sions of different High Courts and the ap on which could be arrived at is: urden to prove the identity, capacity and the assessee. h credit is not satisfactorily explained th ified to treat it as income from "undisclose e has to establish that the amount was , uineness and regularity in the mainte to be taken into consideration by the taxin anation is not supported by any docume hen the deeming fiction created nvoked.” T(A), upon a detailed examina the Assessing Officer. The app multiple opportunities, both dur dings, the assessee was unable or verifiable evidence to demo igital Productions Pvt. Ltd 9 basis of arriving iscounted Cash fficer, therefore, urden of proving iber, and the e provisions of pugned premium ssing Officer is on 68 and the apex court, the d genuineness he Income-tax ed sources". actually given enance of the ng authorities, entary or other by section ation, concurred pellate authority ring assessment e to provide any onstrate how a share of face value ₹ per share, particula juri iction. The CIT furnished by the a material to establish and, therefore, did judicial precedents, High Court in Major M transaction lacking introduction of unac of share premium. reproduced as under 6. Finding of facts of the submission of remand repor record. From return of in 30.09.2013, d the assessee 12.03.2015, d was selected 143(2)/ 142(1 perusal of ba issued the pr 4186 shares, Matrix Partn registered off proceedings th to the share p company, the relevant infor receiving hug that to from haven country Shot Formats D

1 In complia the share, ha 34,987.67/- p in Mauritius- opportunity of remand proce Rs. 14,99,57, in Mauritius. material evid AO or during the logic/ ba share. The A Hon'ble Cour matching with 7.2 It is also transaction f indicate the f premium to t unaccounted premium mon appellant me report based on PECV meth share while share. The le without assig method take projections of determining considered fu is submitted done on reaso 7.3 The above and method method at Rs share, which credible mate of these facts Rs.14,99,57,1 investment Ho is dubious in money under from the tax verification/cr the entire am Shot Formats D ance the appellant could not demonstrate aving face value of Rs. 10/-, could fetch p per share, that to from the company which tax haven country. The appellant was f being heard by the AO during assessm eeding, to justify the genuineness of sha ,141/-, received from the company which The appellant however, could not bring dence and logical justification on record, g appellate proceeding, by which one ca asis to arrive at the premium of Rs. 34 Appellant had placed reliance on rulin rts, whose facts and circumstances ar h the fact of the case under consideration to be noted that the appellant had arrang from entity which is based in the Ma fact that the appellant had given the c this transaction, to justify the introducti amount of Rs. 14,99,57,141/-, under the ney. During the course of appellate pro erely stated that- " the appellant had f on DCF method and also a valuation sta hod. The value as per DCF method was R the value as per PECV method was Rs earned DCIT has chosen to ignore them gning any reasons whatsoever. Valuatio es into account the future cash flow of future revenues and profit of the the value as per DCF method, the uture revenue and profit for the years 20 that the projection of future revenue and onable and scientific basis........ e contention of the appellant is based on of valuation to arrive at above values s. 30,035 and as per PECV method Rs was not accepted by the AO in the ab rial evidence and logical justification on r s it is held that the entire amount of sha 141/-, received from M/s Matrix Pa Holdings II LLC, having its registered office nature and design to introduce its own r the garb of share premium, in its book x heaven country, which can't be subj ross check. Considering these facts the mount of share premium of Rs.14,99,57,1 igital Productions Pvt. Ltd 11 e as how come premium of Rs. h is registered s given ample ent as well as re premium of h is registered g any credible either before an understand 4,987.67/- per gs of various re not exactly n. ged the above auritius, itself color of share ion of its own e garb of share oceedings the filed valuation atement based Rs. 30,035 per s. 36,450 per m all together n as per DCF ws based on business. In e valuer has 013 to 2016. It d o profit was n his own logic s i.e. by DCF s. 36,450 per bsence of any record. In view are premium of artners India e in Mauritius, n unaccounted ks of account, jected to any AO held that 41/-, received from M/s Ma shame trans appellant, by this regard, followings cas 7.4 In the cas the Hon'ble unexplained c offer an expla found to be n facts, the Hon 7.5 Keeping considered o money/share received from having its reg design to intr share premiu country- whic therefore, not upheld. All th 5.3 Before us, the L under Rule 29 of the admitting additional

Audited 2. Audited 3. 3- Audited 4. 4' Audited 5. Valuati the ind II. Overview of D 6. Inform and inv 7. AIF rel on the 8. Media as “Z47 9. Registr 10. Finn Por IV.Media C 11. “Matrix Works” 12. “Digital Series A www.vcc 5.4 The evidence p statements for subs dated 28.09.2012, justification of the pr substratum of valuat counsel pressed for respect to items 1 to financial performanc Shot Formats D d Financial Statements for FY 2012-13 1 d Financial Statements for FY 2013-14 3 d Financial Statements for FY 2014-15 6 d Financial Statements for FY 2015-16 8 ion report dated 28th September 2012 issued by dependent valuer 1 DeltaZen4 7 A dvisors LLP (formerly “Matrix P ”) ation about firm background, team members vestment focus 1 ated regulatory details of the firm as mentioned Firm’s website 1 Coverage for Rebranding of “Matrix Partners” 7” (DeltaZen47 Advisors LLP) in India. 1 ration of “Matrix Partners” with SEBI 1 Ill Portfolio collection of“Z47” rtfolio and Spotlight Investments 155 Coverage of Z47’s Investment in Shot Formats provides Series A for Shot Formats Digital on www.avej.com 178 Entertainment Platform Biscoot Receives A Funding from Matrix Partners” on circle.com 179 placed comprises, inter alia, au equent years as well as the v which were stated to be ge remium and to the DCF projecti tion. During the course of hear admission of additional evid 5 of the Paper Book, submitting ce in subsequent years exceede igital Productions Pvt. Ltd 13 1-32 33-62 63-83 84- 123 124- 128 Partners 129-141 142- 143 144- 152 153-154 5-177 s 8 9- 182 udited financial valuation report ermane to the ions forming the ring, the learned dence only with g that the actual ed the projected revenue, and theref neither fanciful nor e 5.5 In our considere be introduced is mat namely, the justifica share premium. The authorities and, in o adjudication of the co of additional eviden crucial to do substan for bona fide reasons the same. 5.6 Accordingly, in complete and proper orders of the lower au of the Assessing Off additional evidence s consider necessary, accordance with law opportunity to prese used against it shall principles of natural the assessee are allow Shot Formats D fore the valuation at the rele excessive. ed view, the additional evidence terial and bears directly upon t tion of the valuation underlyin e evidence was not considered our view, is essential for a fai ontroversy. The principles gover nce are well settled: where su ntial justice and could not earl s, the Tribunal would be justifi n the interests of justice and r examination of the matter, w uthorities and restore the entire ficer. The Assessing Officer sha submitted, undertake such inqu and thereafter adjudicate the w. The assessee shall be affo ent its case, and any material be duly confronted to ensure c justice. In consequence, the gro wed for statistical purposes. igital Productions Pvt. Ltd 14 evant time was e now sought to the core issue— g the impugned d by the lower ir and complete rning admission uch evidence is lier be produced ied in admitting d to ensure a we set aside the e issue to the file all examine the uiries as he may issue afresh in orded adequate proposed to be compliance with ounds raised by 6. In the result, statistical purposes. Order pronoun (SANDEEP G JUDICIAL M Mumbai; Dated: 25/11/2025 Rahul Sharma, Sr. P.S.