M/S. VINANT TRUST,MUMBAI vs. DCIT, CIRCLE 26(1), MUMBAI

ITA 9325/MUM/2025Status: DisposedITAT Mumbai06 August 2026AY 2014-157 pages
AI SummaryAllowed

What were the facts?

The assessee trust redeemed preference shares at Rs. 100 per share, but the AO substituted this with Rs. 325 per share, the price at which equity shares of the same company were acquired. The CIT(A) upheld this substitution but allowed indexation and a 20% tax rate.

What did the Tribunal hold?

The Tribunal held that equity and preference shares are distinct and cannot be valued alike. It further stated that Section 48 requires the actual consideration received, and Section 50CA, which deems fair market value, was not applicable for the assessment year in question.

What were the issues?

Whether the redemption value of preference shares can be substituted with the acquisition price of equity shares of the same company, and whether Section 50CA is applicable for the relevant assessment year.

Which sections of the Income-tax Act were involved?

Section 48,Section 50CA

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “F” BENCH, MUMBAI

Before: SHRI NARENDER KUMAR CHOUDHRY & SHRI JAGADISH

For Appellant: Shri Hitesh Jain, CA
For Respondent: Shri Mehul Jain (SR. DR)
Hearing: 13.05.2026Pronounced: 06.08.2026

Per: SHRI JAGADISH, A.M.:

1.

This appeal by the assessee is directed against the order dated 25.11.2025 passed by the National Faceless Appeal Centre, Delhi [hereinafter referred to as “Ld. CIT(A)”], arising from the assessment order dated 30.12.2016 passed under section 143(3) of the Income-tax Act, 1961 (“the Act”) by the Income Tax Officer-17(3)(5), Mumbai, for the assessment year 2014-15. M/s. Vinant Trust

2.

The assessee has raised the following grounds of appeal:

“1. The learned CIT(A) has erred in upholding the action of the AO in substituting the sale price of 79,625 9% non-cumulative preference shares of M/s M. Manifold Pvt. Ltd. at Rs.325 per share as against the actual price of Rs.

The order continues below.

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