NATHAN ANIL RAO, MUMBAI vs. THE ITO -CIRCLE 23(1), MUMBAI

PER OM PRAKASH KANT, AM

This appeal by the assessee is directed against order dated
22nd October, 2025 passed by the Ld. Commissioner of Income
Tax (Appeals) – National Faceless Appeal Centre, Delhi [in short,
“the Ld. CIT(A)] for assessment year 2017-18 raising following grounds:

“General ground
1. erred in assessing t as against the returne the provisions of sectio

Opportunity of being
2. Ld. NFAC has erred of being heard to the A request and not app provided by the Appell

Ld. AO has exceeded
3. erred in exceeding j making an addition of Income Tax Act whi assessment under sec of CASS reason "Large

Addition of Rs. 16
premium:
4. erred in making add of the Act on account o fact that the Appellant while computing the thereby leading to the 5. erred in solely rely
Rentokil Initial Asia P ascertain the minimum
FEMA regulations with Pest Control Private L
Appellant and Rentoki under Section 133(6) of the Appellant, despite the buyer;

Erroneous levy of int
7. erred in levying inte

Erroneous levy of int
8. erred in levying inte

Erroneous levy of int
9. erred in levying inte

Initiation of penalt
271AAC of the Act
10. erred in initiating p of the Act.”
2. Before us, the L ground no.2 of the a the request of short
ITA the Total Income of the Appellant at Rs. 16,0
ed income of Rs.4,01,94,310/- by incorrectl on 68/Section 69 of the Income Tax Act; g heard d in passing ex-parte order without granting o
Appellant by rejecting the Appellant's short ad preciating the reasonable cause for the ad lant; d his juri iction juri iction by passing the final assessment f Rs. 16,02,68,952/- under section 68/Sectio ich was the beyond the scope of Limited ction 143(2) of the Income Tax Act which was e deduction/exemption claimed;
6,02,68,952 on account on unexplain dition of Rs. 16,02,68,952 under Section 68/
of unexplained share premium without appre t had offered the amount to tax as "Sales Con capital gains during the year under con double taxation of the same income; ying on the valuation report issued to the Pacific Management Pte Ltd ('Rentokil Sin m price of share of PCI Pest Control Private Lim hout appreciating the fact that sale price of sh
Limited has been commercially negotiated be il Singapore; failed to obtain confirmation from of the Income-tax Act, 1961, as specifically re e the Appellant having furnished all relevan terest under section 234B of the Act:
rest under section 234B of INR 3,75,54,429; terest under section 234C of the Act rest under section 234C of INR 68,972; terest under section 234D of the Act rest under section 234D of INR 61,387; ty proceedings under Section 270 and penalty proceeding under section 270A and Ld. Counsel for the assessee ad appeal submitted that the Ld. C adjournment of the assessee
Nathan Anil Rao
2
No. 8666/MUM/2025

07,69,040/- ly invoking opportunity djournment djournment order after n 69 of the d Scrutiny on account ned share
/Section 69
eciating the nsideration"
nsideration, buyer i.e.
ngapore') to mited under hares of PCI etween the m the buyer quested by t details of d Section 271AAC(1) ddressing the CIT(A) rejected for providing opportunity of being
Ld. Counsel for th admitting additional
(Appellate Tribunal) R
3. We have heard the relevant materia appeal of the assess has failed to file docu of the Income Tax Ac identity, creditworthi share premium. Th reproduced as under “Decision: I have caref made by the appellant a observation and findings

It is observed from the and documentary eviden the onus to prove identit share premium with su
Rs.31,749/- per share share which includes th as determined by the M unreasonable and unexp premium of Rs. 16,02
number of shares.) as u gain.

It is observed from the counld justifiably establ valuation report of sha determined at Rs.7872
Rs.39621/- per share
Rentokil

Initial Asia Pacific Man statement Annual Repot submitted before the A scrutiny assessment.

ITA g heard and passed the order he assessee also filed an ap evidence under Rule 29 of the Rules, 1963. rival submissions of the parties al on record. The Ld. CIT(A) d see mainly for the reason that umentary evidence in support of ct, 1961 (in short, “the Act”) for iness and genuineness of the t he relevant finding of the L
:
efully considered the grounds of appeal an as above, the facts of the case as well as gon s of the AO 's assessment order vide dated 28
assessment order that the AO based on deta nces has held, since the appellant being failed ty, Creditworthiness of co. & genuineness of upporting documentary evidence, the share p which is over and above the fair value of @
he share premium also on @ Rs. 100/-, each
M/s Deloite Haskin & sells in his valuation xplained And accordingly the AO has added t
2,68,952/-(share premium @ Rs.31749 per unexplained and accordingly reduce the Long assessment order that neither the AR nor lish how the Deloitee Haskins & sells could h are of company M/s PCI Pest control Pvt.
2/- per share of Rs.100/-each fully paid on which rate assessee has shown sold nagement Pvt. Ltd. Singapore in as much as t, Balance sheet, P & L a/c of M/s PCI Pest c
AO to examine the worth of this company
Nathan Anil Rao
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No. 8666/MUM/2025

ex-parte. The pplication for e Income Tax s and perused dismissed the the assessee f onus u/s 68
r establishing transaction of Ld. CIT(A) is nd submission ne through the 8-12-2019. ailed analysis d to discharge transaction of premium of @
@Rs.7872/-per fully paid up, n report being the total share rshare /5048
g Term Capital the appellant have prepared
.Ltd. & value up & not for his shares to s no financial control Pvt.Ltd.
in course of It is observed despite a neither the appellant no onus by providing any a scrutiny assessment s genuineness of transact amount to the appellant

In view of above, I do no I have no hesitation in 2019 is based on apro does not warrant interf determining total inco unexplained cash credi law. Accordingly addi
16,02,68,952/- under relating to this issue are In the result, the appeal
4. We find that th pertains to alleged e which has been char under consideration shares of PCI Pest Co
Asia Pacific Managem
Singapore for a total the course of the scru the assessee to just transaction. But the u/s 133(6) of the Act not accepted and th addition u/s 68 of t appeal before the Ld.
during the first ap adjournment letters submitting documen
ITA availing ample/ multiple opportunity in asse or its authorized representative could have d acceptable satisfactory evidence before the A so as to establish identity, Creditworthine tion of share premium with persons advancin t.
ot find any infirmity in the order of the AO an holding that the impugned order of the AO opos consideration of facts and law and he rference. Therefore I am of opinion that AO me after addition of 16,02,68,952/- wit t invoking section 68, is justified and in acc ition made by the AO in assessment unexplained credit stand confirmed and e dismissed.
of the appellant is dismissed.”
he issue in dispute on merit i excess premium received on s rged to tax u/s 68 of the Act. Du
, the assessee had made a ontrol Private Limited to M/s R ment PTE Ltd., a non-resident en l consideration of Rs.20,00,06,9
utiny proceeding, the Assessing ify the identity and creditwort e assessee requested for issua t. The request of the assessee w he Assessing Officer proceeded the Act. Being aggrieved, the a . CIT(A). It is contended by the ppeal proceeding, the assesse before the Ld. CIT(A) seek nts as time was required to Nathan Anil Rao
4
No. 8666/MUM/2025

essment stage discharged its AO in course of ess of co. &
ng substantial nd resultantly, dated 28-12- ence the same
O's decision of th respect to cordance with order of Rs.
the grounds in the appeal ale of shares uring the year sale of 5048
Rentokil Initial ntity based in 909/-. During
Officer asked hiness of the ance of notice was, however, to make the assessee filed assessee that ee had filed king time for collate those documents from var
This exercise was pertaining to financia ordination with them another opportunity the matter ex parte.
those crucial docum the assessee at the lo by the assessee befor
5. Having consider the opinion that the cause in producing t
ITA rious sources including non-re time consuming as the docu al of non-resident entities which m. However, the Ld. CIT(A) d to the assessee of being heard
The Ld. Counsel submitted tha mentary evidence could not be ower level. The list of additional re us is reproduced as under:
red the submission of the asses assessee was prevented by way the documents before the lowe
Nathan Anil Rao
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No. 8666/MUM/2025

sident buyer.
uments were h required co- did not offer d and decided at as a result submitted by evidence filed see, we are of y of sufficient er authorities.

Accordingly, we set a restore the matter b adjudication of the is light of documents fil creditworthiness and 6. The ground no.
The other grounds on 7. In the result, ap purposes.
Order pronoun (KAVITHA RAJAG
JUDICIAL MEM
Mumbai;
Dated: 13/03/2026
Ankit, Sr. P.S.

Copy of the Order forward
1. The Appellant
2. The Respondent.
3. CIT
4. DR, ITAT, Mumbai
5. Guard file.

////

ITA aside the order of the lower au back to the file of the Assessin ssue in dispute in accordance w led by the assessee in support o d genuineness of the transaction
.2 of the appeal of the assesse n merit are accordingly rendered ppeal of the assessee is allowed ced in the open Court on 13/0 GOPAL)
(OM PRAKA
MBER
ACCOUNTAN ded to :

BY ORDE

(Assistant Re

ITAT, Mu
Nathan Anil Rao
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No. 8666/MUM/2025

uthorities and ng Officer for with law in the of the identity, n.
ee is allowed.
d academic.
for statistical
03/2026. d/-
ASH KANT)
NT MEMBER
R, gistrar) umbai