DEPUTY COMMISSIONER OF INCOME TAX, VADODARA vs. ALIKRAFT ENGINEERS PVT LTD, VADODARA GUJARAT

PER SIDDHARTHA NAUTIYAL - JUDICIAL MEMBER:

“1. Whether on the facts of the case and in law, the Ld. CIT(A) was justified in deleting the addition of Rs.33,67,500/- made by the AO on account of the difference between the value of the share worked out in the valuation report at Rs.80/- and the fair market value worked out at Rs.12.65/- by applying the formula (A-L) X (PV)/(PE)? 2. Whether on the facts of the case and in law, the Ld.CIT(A) was justified in deleting the addition of Rs.33,67,500/- made by the AO, ignoring the findings of the AO that the valuation report has been submitted by the same Accountant who has also audited the accounts of the company u/s 44AB of the Act, which is contrary to provisions of the Act as well as Rule 11UA of the Income Tax and also that future projections adopted by the Accountant are devoid of any basis?

DCIT vs. Alikraft Engineers Pvt. Ltd. Asst.Year –2014-15 - 2–

at the time of, or before, the hearing of appeal. It is prayed that the order of the CIT(A) on the above issuers be set-aside and that of the Assessing Officer be restored.”

3. At the time of hearing, it was submitted by the Ld. AR for the assessee that appeal filed by the Revenue is hit by recently issued CBDT Circular No.17 of 2019 dated 08.08.2019 revising the previous thresholds pertaining to tax effects. As per aforesaid Circular, all pending appeals filed by Revenue are liable to be dismissed as a measure for reducing litigation where the tax effect does not exceed the prescribed monetary limit which is now revised at Rs.50 Lakhs. In the instant case, the tax effect on the disputed issues raised by the Revenue is stated to be not exceeding Rs.50 lakhs and therefore appeal of the Revenue is required to be dismissed in limine.