INCOME TAX OFFICER - 9(2)(1), MUMBAI vs. COOLBERG BEVERAGES PVT LTD, MUMBAI

ITA 4286/MUM/2026Status: DisposedITAT Mumbai21 September 2026AY 2022-2310 pages
AI SummaryDismissed

What did the Tribunal hold?

The Tribunal held that the AO cannot reject the DCF method chosen by the assessee and substitute it with the NAV method without demonstrating fundamental defects in the DCF computation or its underlying assumptions. Reliance on management projections is inherent in the DCF method.

What were the facts?

The assessee issued shares at a premium, obtaining a valuation report using the DCF method. The AO rejected this valuation, deeming it unreliable due to reliance on management projections, and instead used the NAV method. The CIT(A) deleted the addition, holding that the AO could scrutinize but not discard the chosen method.

What were the issues?

Whether the AO can reject a valuation report based on the DCF method, chosen by the assessee as per Rule 11UA, and substitute it with another method (NAV) based on perceived unreliability of management projections.

Which sections of the Income-tax Act were involved?

Section 56(2)(viib)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, MUMBAI BENCHES, MUMBAI

Before: SMT. BEENA PILLAI, HON’BLE & SHRI JAGADISH, HON’BLE

PER SMT. BEENA PILLAI, JUDICIAL MEMBER:

ITA 4286/MUM/2026

The present appeal is filed by the Revenue against the order dated 03/02/2026 passed by the Ld. Commissioner of Income-tax (Appeals), National Faceless Appeal Centre (“Ld. CIT(A)”), for Assessment Year 2022-23 on following grounds of appeal:

1.

Whether on the facts and in the circumstances of the case

The order continues below.

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