M/s. Rameshwaram Strong Glass (P) Ltd. v. The ITO

172 ITD 571Income Tax Appellate Tribunal2018#7283 most cited

What is M/s. Rameshwaram Strong Glass (P) Ltd. v. The ITO authority for?

An assessee can choose the Discounted Cash Flow (DCF) method for share valuation under Rule 11UA(2), and the Assessing Officer cannot discard this method to adopt another, like the Net Asset Value (NAV) method, unless the assessee's chosen method or its assumptions are challenged with sound reasoning.

15

judgments rely on this decision, according to BharatTax’s citation analysis of 366,005 Indian tax judgments — from 2019 to 2024.

Also referred to as

Rameshwaram Strong Glass · valuation of shares · Rule 11UA(2) · DCF method · NAV method · Section 56(2)(viib) · Assessing Officer powers · Tribunal · fair market value

Sections most often in play

Section 143(3)Section 250Section 263Section 56(2)(viib)

Issues it is cited on

nav methoddcf methodsection 56(2)(viib)valuation of sharescommercial rightssection 56(2)fair market valuesection 56previous yearcompanyprescribedperson

Judgments citing M/s. Rameshwaram Strong Glass (P) Ltd. v. The ITO

ITO Ward - 24(1), New Delhi vs. Solitaire Btn Solar Pvt Limited, New Delhi

In the result, the appeal of the Revenue is dismissed

ITA 1416/DEL/2020[2016-17]Status: DisposedITAT Delhi12 Jun 2024AY 2016-17

Bench: Shri Kul Bharat & Shri Pradip Kumar Kedia

For Appellant: Shri Gaurav Jain, AdvocateFor Respondent: Shri Gurpreet Singh, Sr.DR
Section 143(3)Section 250Section 56(2)(viib)

…at as per Rule 11UA(2), assessee could opt for DCF method and if assessee had so opted for DCF method, AO could not discard the same and adopt other method i.e. NAV method of valuing shares. In case of M/s. Rameshwaram Strong Glass (P) Ltd. vs. The ITO [2018] 172 ITD 571 (Jaipur - Trib.), the tribunal had reproduced relevant portion of another tribunal order rendered in case of ITO vs. M/s Universal Polypack (India) Pvt. Ltd. In such case, tribunal held that if assessee had opted for DC method, AO could not challenge the same but AO was well within his rights to examine methodology adopted by assessee and underly…

ITO Ward - 23(1), New Delhi vs. Sharp Eye Broadcasting Pvt Ltd, New Delhi

In the result, the appeal of the Revenue is allowed for statistical purposes

ITA 1105/DEL/2020[2016-17]Status: DisposedITAT Delhi20 Nov 2023AY 2016-17

Bench: Shri Saktijit Dey- & Shri Pradip Kumar Kedia-

For Appellant: Shri Arun Kumar, AdvFor Respondent: Shri Anuj Garg, Sr.DR
Section 143(3)Section 56(2)(viib)

…ssessee could opt for DCF method and if I.T.A. No.1105/Del/2020 10 assessee had opted for DCF method, AO could not discard the same and adopt other method i.e. NAV method of valuing shares. In case of M/s. Rameshwaram Strong Glass (P) Ltd. vs. The ITO [2018] 172 ITD 571 (Jaipur – Trib.), the tribunal had reproduced relevant portion of another tribunal order ordered in case of ITO vs. M/s Universal Polypack (India) Pvt. Ltd. In such case, tribunal held that if assessee had opted for DCF method, AO could not challenge the same but AO was well within his rights to examine methodology adopted by assessee and underly…

Joint Commissioner of Income Tax (OSD) Circle-3, Ferozepur vs. Measage Om Sons Marketing Private Limited, Faridkot

In the result, the appeal of the revenue bearing ITA No

ITA 407/ASR/2019[2015-16]Status: DisposedITAT Amritsar07 Jul 2023AY 2015-16

Bench: Dr. M. L. Meena & Sh. Anikesh Banerjee

Section 143(3)Section 250(6)Section 37(1)Section 56(2)(viib)

…ons and failed to provide any alternate fait value of shares; Tribunal was therefore justified in deleting the addition made under section 56(2)(viib).” I.T.A. No.407/Asr/2019 10 Assessment Year: 2015-16 b) Rameshwaram Strong Glass P Ltd. Vs ITO in ITA No. 172 ITD 571 (Jaipur Bench) dated 12.07.2018 “If assessee exercises option to value its shares by choosing particular valuation method specifically provided by law, then changing such method or adopting different method would be beyond powers of revenue authorities.” c) Vodafone M-Pesa Ltd. vs PCIT as reported in 92 taxmann.com 73 (Bom HC) it has been held…

Upaid Systems Ltd., New Delhi vs. DCIT, Circle- 3(1)(2), Intl. Taxation, New Delhi

In the result, the appeal is partly allowed

ITA 3460/DEL/2018[2012-13]Status: FixedITAT Delhi24 Mar 2023AY 2012-13

Bench: Shri G.S. Pannu, Hon’Ble & Shri Saktijit Deyassessment Year: 2012-13

Section 9(1)(vi)

…n [2014] 221 Taxman 158 9. CIT Vs. Manjulaben M. Unadkat, 229 Taxman 531 (Gujarat) 10. Shri Rajendra H. Seth Vs. ACIT, ITA No1495/Ahd/2007 (Ahd. Trib.) 11. Sosamma Paulose Vs. JCIT, 79 TTJ 573 (Coch.) 12. Rameshwaram Strong Glass (P.) Ltd. Vs. ITO, [2018] 172 ITD 571 (Jaipur) 5.2 Per contra, learned CIT(DR) strongly relied upon the observations of the Assessing Officer and learned Commissioner (Appeals). He submitted, the expert from whom the assessee has obtained the valuation report may be having some knowledge of telecom sector but that does not make him world renowned. He submitted, royalty is nothing…

Planet Gogo Private Ltd., Gurgaon vs. ITO Ward-3(2), Gurgaon

In the result, the appeal is allowed

ITA 1526/DEL/2022[2016-17]Status: DisposedITAT Delhi24 Feb 2023AY 2016-17

Bench: Shri Saktijit Deyassessment Year: 2016-17

Section 56(2)Section 56(2)(viib)

…the following decisions: i) Cinestaan Entertainment (P) Ltd. vs. ITO – ITA No.8113/Del/2018 dated 27.05.2019; ii) M/s. Clear View Healthcare Pvt. Ltd. vs. ITO – ITA No.2222/Del/2019 dated 03.01.2020; iii) Rameshwaram Strong Glass Pvt. Ltd. vs. ITO, (2018) – 172 ITD 571, (ITAT Jaipur Bench); iv) Intelligrape Software Pvt. Ltd. vs. ITO, in ITA No.3925/Del/2018 dated 30.09.2020, (ITAT Delhi Bench); 5 ITA No.1526/Del./2022 v ) Rockland Dignostic Service Cente Pvt. Ltd. vs. ITO, in ITA No.316/Del/2019 dated 25.02.2021, ITAT Delhi Bench; vi) M/s. Flutura Business Solutions Pvt. Ltd., Vs. ITO, in ITA No.3404(Beng)/2…

ITO, Ward - 11(3), Kolkata vs. M/S. Lnb Renewable Energy Pvt. Ltd., Kolkata

In the result, the appeal filed by the Revenue is allowed

ITA 2011/KOL/2018[2013-14]Status: DisposedITAT Kolkata30 Nov 2022AY 2013-14

Bench: Sri Sanjay Garg & Dr. Manish Borad

Section 143(2)Section 143(3)Section 250Section 56(2)Section 56(2)(viib)

…red by an Independent Valuer basis the discounted cash flow method, cannot be rejected by the AO:  Cinestaan Entertainment (P) Ltd. (2019) (177 ITD 809) (Delhi Tribunal) -Page 120-139 of the supplementary paper book  Rameshwaram Strong Glass (P) Ltd (2018) (172 ITD 571) (Jaipur Tribunal) - Page 140 - 157 of the supplementary paper book  Narang Access Pvt. Ltd. (ITA No. 3521/M/2018) (Mumbai Tribunal) - Page 158-165 of the supplementary paper book  Karmic Labs Pvt. Ltd. (ITA No. 3955/M/2018) (Mumbai Tribunal) - Page 166-182 of the supplementary paper book  Safe Decor (P) Ltd. (2018) (169 ITD 328) (Jaipur Tribu…

M/S Nirbhai Textiles Pvt. Ltd., Ludhiana vs. ACIT, C-2, Ludhiana

The appeal of the assessee stands allowed

ITA 1401/CHANDI/2018[2014-15]Status: DisposedITAT Chandigarh22 Aug 2022AY 2014-15

Bench: Shri N.K. Saini & Shri Sudhanshu Srivastavaआयकरअपीलसं./Ita No.1401/Chd/2018 "नधा"रणवष" / Assessment Year :2014-15

For Appellant: Sh. Sudhir Sehgal, AdvocateFor Respondent: Sh. Akashdeep, JCIT Sr. DR
Section 143(1)Section 56Section 56(2)(viib)

…rmit the AO to make the adjustment therein. 8 1401-Chd-2018 (A.Y. 2014-15) – M/s Nirbhai Textiles Pvt Ltd, Ludhiana 3.4 The Ld. AR referred to the order of the Jaipur Bench of the ITAT in the case of “Rameshwaram Strong Glass Pvt. Ltd. vs. ITO” reported in 172 ITD 571 wherein it has been held that there was no discretion with the AO to discard the method of valuation adopted by the assessee and also it was further held that when the law has specifically provided a method of valuation and the assessee has exercised an option by choosing a particular method (DCF), changing the method by adopting a different…

K.P. Woven Pvt. Ltd., Ahmedabad vs. The ITO, Ward-2(1)(2), Ahmedabad

In the result, the appeal filed by the assessee is allowed for the statistical purposes

ITA 169/AHD/2018[2014-15]Status: DisposedITAT Ahmedabad25 Oct 2021AY 2014-15

Bench: Shri Waseem Ahmed & Ms Madhumita Royआयकर अपील सं./Ita No.169/Ahd/2018 िनधा"रण वष"/Asstt. Year: 2014-2015 K.P. Woven Pvt. Ltd., I.T.O., 13-B, Navbharat Society, Vs. Ward-2(1)(2) Usmanpura, Ahmedabad. Ahmedabad-380013. Pan: Aaeck6307M

For Appellant: Ms Asthamaniar, A.RFor Respondent: Shri R.R.Makwana, Sr..D.R
Section 56(2)Section 56(2)(viib)

…आयकर अपीलीय अिधकरण, अहमदाबाद "यायपीठ IN THE INCOME TAX APPELLATE TRIBUNAL, ‘’ B’’ BENCH, AHMEDABAD (CONDUCTED THROUGH VIRTUAL COURT AT AHMEDABAD) BEFORE SHRI WASEEM AHMED, ACCOUNTANT MEMBER And Ms MADHUMITA ROY, JUDICIAL MEMBER आयकर अपील सं./ITA No.169/AHD/2018 िनधा"रण वष"/Asstt. Year: 2014-2015 K.P. Woven Pvt. Ltd., I.T.O., 13-B, Navbharat Society, Vs. Ward-2(1)(2) Usmanpura, Ahmedabad. Ahmedabad-380013. PAN: AAECK6307M (Applicant) (Respondent) Assessee by : Ms Asthamaniar, A.R Revenue by : Shri R.R.Makwana, Sr..D.R सुनवाई क" तारीख/Date of Hearing : 29/09/2021 घोषणा क" तारीख /Date of Pronouncement: 25/10/2021…

Mesers Him Agri Fesh Pvt. Ltd, Jalandhar vs. Income Tax Oficer Ward-1(2), Jalandhar

The appeal of the assessee is allowed for statistical purposes

ITA 224/ASR/2018[2014-15]Status: DisposedITAT Amritsar07 Jul 2021AY 2014-15

Bench: Sh. Laliet Kumar & Dr. M. L. Meenai.T.A. No. 224/Asr/2018 Assessment Year: 2014-15

…unted cash Flow method is an approved method as per rule 11UA of the Income Tax Rules. 9. He had relied upon the following decision:- (a) ITO vs Unicersal Polysack (India) Pvt Ltd. in ITA No. 609/JP/2017 (b) Rameshwaram strong glass P Ltd. Vs ITO in ITA No. 172 ITD 571 (Jaipur Bench) dated 12.07.2018 (PB pg-21-39) (c) Vodafone M-Pesa Ltd. vs PCIT as reported in 92 taxmann.com 73 (Bom HC) (d) Cinestaan Entertainment P Ltd vs ITO as reported in 106 taxmann.com 300 (Del Trib). (Pb Pg-60-83) 6 Karmic Labs Pvt Ltd. vs ITO (Mumbai Bench) in ITA No. 3955/Mum/2018 order dated 28.07.2020. (PB Pg-87- 103) (f) DCIT Vs…

Tsi Yatra Pvt. Ltd., Gurgaon vs. Addl. CIT, Range-25, New Delhi

In the result, the appeal of the assessee is partly allowed for statistical purposes

ITA 1068/DEL/2019[2014-15]Status: DisposedITAT Delhi14 Dec 2020AY 2014-15

Bench: Shri Amit Shukla & Dr. B.R.R. Kumar

For Appellant: Shri Tarandeep Singh, AdvFor Respondent: Shri S.S. Rana, Sr.D.R
Section 143(3)Section 234ASection 271(1)(c)Section 56(2)(viib)

…t March 2014 then there is a difference of 7.3% and 13.8% respectively. In this regard it is submitted that entire approach to compare projected revenue with actual revenue is not in accordance with law {Reference: Rameshwaran Strong Glass Pvt Ltd reported in 172 ITD 571(Jai) copy enclosed at pages 13 to 33 of Case law PB-II relevant at pages 30-31, para 4.5.2 and 4.5.3} Without prejudice, it is submitted that the AO has erroneously concluded that Appellant’s revenue projections are without any 16 I.T.A. No.1068/DEL/2019 rationale and scientific basis.In this regard, the assessee would like to submit below compa…

Suryoday Small Finance Bank Ltd.(Earlier Known As Suryoday Micro Finance Ltd.), Navi Mumbai vs. DCIT - 15(3)(2), Mumbai

In the result, appeal of the assessee is partly allowed

ITA 3440/MUM/2018[2014-15]Status: DisposedITAT Mumbai02 Mar 2020AY 2014-15

Bench: Sri Rajesh Kumar, Am & Sri Amarjit Singh, Jm आयकर आयकर अपील आयकर आयकर अपील अपील संसंसंसं./ Ita No. 3440/Mum/2018 अपील (िनधा"रण वष" / Assessment Year 2014-15) Suryoday Small Finance Bank The Dy. Commissioner Of Ltd. Income Tax-15(3)(2) (Earlier Known As Suryoday Aaykar Bhvan, Mahareshi Micro Finance Ltd.) Karve Road, Mumbai-400 020 बनाम/ बनाम बनाम बनाम 1101, Sharda Terraces, Plot Vs. No.65, Sector 11, Cbd Belapur, Navi Mumbai-400 614 (अपीलाथ" अपीलाथ" / Appellant) अपीलाथ" अपीलाथ" (""यथ" ""यथ"/ Respondent) ""यथ" ""यथ" "थायी "थायी लेखा "थायी "थायी लेखा लेखा संसंसंसं./Pan No. Aamcs5499J लेखा : Shri Yogesh Thar, Ar अपीलाथ" क" ओर से / Appellant By : Shri V. Vinod Kumar, Dr ""यथ" क" ओर से / Respondent By 05.12.2019 सुनवाई क" तारीख / Date Of Hearing: घोषणा क" तारीख / Date Of Pronouncement: 02.03.2020 आदेश आदेश / O R D E R आदेश आदेश राजेश कुमार, लेखा सद"य / Per Rajesh Kumar, Am: These Are Appeals By The Assessee Directed Against Respective Orders Of Learned Cit(A) Pertaining To Assessment Year 2014-15. 2. The Ground Raised By The Assessee Are As Under: -

For Appellant: Shri V. Vinod Kumar, DR
Section 115JSection 14ASection 250Section 3Section 36(1)(va)Section 37(1)Section 56(2)(vii)Section 56(2)(viib)

…or believed that there are some other good comparables, he ought to have selected such comparable and should have arrived at fair market value of the shares. In defence, the learned AR relied on the decision of Rameshwaram Strong Glass (P.) Ltd. v. ITO (2018) 172 ITD 571 (Jaipur) (Trib.), wherein the Tribunal has held that AO was not justified in changing method of valuation adopted by the assessee. The learned AR stated that the comparable selected by the assessee 10 | P a g e Suryoday Small Finance Bank Ltd. was rejected on mere assumption and surmises without coming- up with comparable that may be considered…

Rissala Decor Pvt Ltd, Gurgaon vs. Pr. CIT, Gurgaon

The appeal is dismissed

ITA 2895/DEL/2019[2014-15]Status: DisposedITAT Delhi03 Jan 2020AY 2014-15

Bench: Shri Amit Shukla & Shri Anadee Nath Misshra

For Appellant: Shri M.R. Sahu, CAFor Respondent: Shri Sulekha Vema, CIT(DR)
Section 14Section 143(3)Section 263Section 263(1)

…Method in accordance with Rule 11UA(2)(b) read with Sect 56(2)(viib) and valuation report was prepared by CA as per Guidelines of ICAI and no fault was find by AO same shall be accepted and cannot be rejected. Rameshwarem Strong Glass (P.) Ltd Vs. ITO (2018) 172 ITD 571 (JP. Trib) 14. Basis adopted by assessee can not be changed by AO Vodafone M-Pesa Ltd Vs. Pr. CIT (2018) 92 taxmann.com (Bom. HC) 15. Provisions of Sec 56(2) (viib) can not be invoked where Share Applicants are close relatives of the Directors. Vanni Estates (P.) Ltd. Vs. ITO (2018) 172 ITD 629 (Chennai Trib.) 16. Submissions of the Assessee was…

N. J. Eco-Build Pvt. Ltd, Surat vs. Pr. CIT-1, . Surat

In the result, appeal of the assessee is allowed

ITA 221/SRT/2019[2014-15]Status: DisposedITAT Surat13 Dec 2019AY 2014-15

Bench: Shri Sandeep Gosain & Shri O.P.Meenaआ.अ.सं./I.T.A No.221/Srt/2019 "नधा"रण वष"/Assessment Year: 2014-15 M/S.N.J.Eco-Build Pvt Ltd., V The Principal Commissioner S-42, Belgium Square, Opp.Laxmi S Of Income Tax, Surat-1. Vilas Bank. Delhi Gate, Ring Road, . Surat. [Pan: Aaecn 1584 H] अपीलाथ" / Appellant ""यथ"/Respondent "नधा"रतीक"ओरसे /Assessee By Shri Suresh K.Kabra – Ca राज"वक"ओरसे /Revenue By Shri Sreenivas T.Bidari – Cit-Dr सुनवाईकीतारीख/ Date Of Hearing: 09.12.2019 उ"घोषणाक"तार"ख/Pronouncement On: 13.12.2019 आदेश /O R D E R Per Sandeep Gosain, Jm: 1. This Appeal By The Assessee Is Directed Against The Order Of Ld.Principal Commissioner Of Income Tax, Surat-1, Dated 25.03.2019 For The Assessment Year 2014-15. 2. The Appeal Has Been Filed By The Assessee Against The Order Of Ld.Pr.Cit U/S.263 Of The Act.

Section 143(3)Section 263

…Page 1 of 16 N.J.ECO-BUILD PVT LTD. Vs. Pr.CIT, Surat -1/ITA No.221/SRT/2019 for A.Y. 2014-15 आयकरअपील"यअ"धकरण,सुरत"यायपीठ,सुरत IN THE INCOME TAX APPELLATE TRIBUNAL SURAT BENCH, SURAT BEFORE SHRI SANDEEP GOSAIN, JUDICIAL MEMBER AND SHRI O.P.MEENA, ACCOUNTANT MEMBER आ.अ.सं./I.T.A No.221/SRT/2019 "नधा"रण वष"/Assessment Year: 2014-15 M/s.N.J.ECO-BUILD PVT LTD., V The Principal Commissioner S-42, Belgium Square, Opp.Laxmi s of Income Tax, Surat-1. Vilas Bank. Delhi Gate, Ring Road, . Surat. [PAN: AAECN 1584 H] अपीलाथ" / Appellant ""यथ"/Respondent "नधा"रतीक"ओरसे /Assessee by Shri Suresh K.Kabra – CA राज"वक"ओरसे /Reve…

Unnati Inorganics Pvt. Ltd., Bhavnagar vs. The ITO, Ward-1(5), Bhavnagar

In the result, the appeal filed by the assessee is allowed

ITA 2474/AHD/2017[2014-15]Status: DisposedITAT Ahmedabad11 Sept 2019AY 2014-15

Bench: Shri Pradip Kumar Kedia & Shri Mahavir Prasadआयकर अपील सं./I.T.A. No. 2474/Ahd/2017 ("नधा"रण वष" / Assessment Year : 2014-15)

For Appellant: Surya PrasadFor Respondent: Shri Vinod Tanwani, Sr. D.R
Section 56(2)(viib)

…t does not lie in the mouth of the Revenue to take a different position in the preceding assessment years in total contrast to a position duly taken. 6.10 Making reference to the decision rendered by the co-ordinate bench in Rameshwaram Strong Glass (P) Ltd. 172 ITD 571 (Jaipur Trib.) & ASG Leather (P) Ltd. 171 ITD 476 (Kolkata Trib.) the learned AR sought to assert that the assessee has a strong case on ITA No. 2474/Ahd/17 [Unnati Inorganics Pvt. Ltd. Vs. ITO] A.Y. 2014-15 - 10 - merits in terms of Explanation (a) (ii) to Section 56(2)(viib) of the Act. The learned AR submitted that the CIT(A) has totally ignor…

Narang Access Pvt. Ltd. (Formerly Narang Danone Access Pvt. Ltd.), Mumbai vs. DCIT - 13(1)(1), Mumbai

ITA 3521/MUM/2018[2013-14]Status: DisposedITAT Mumbai22 Aug 2019AY 2013-14

Bench: Sri Mahavir Singh, Jm & Sri M Balaganesh, Am

For Appellant: Shri Prakash Jotwani, ARFor Respondent: Shri N. Hemlatha, DR
Section 143(3)Section 56(2)(viib)

…f shares is correct method i.e. DCF and the method adopted by AO on account of Net Asset Valuation (NAV) method is wrong and this view is supported by the co-ordinate Bench decisions of ITAT in the cases of M/s Rameshwaram Strong Glass (P) Ltd. vs. ITO (2018) 172 ITD 571 (Jaipur) (Tirb.), DCIT vs. Ozoneland Agro Pvt. Ltd in ITA No. 4854/Mum/2016 for AY 2013-14 & M/s. Medplus Health vs. ITO in ITA.No.871/Hyd/2015, Regal Builtech Pvt. Ltd. vs. ACIT 7505/DEL/2018. When these facts were confronted to the learned Sr. Departmental Representative, he agreed that the matter has to be restored back to the file of the AO t…

M/s. Rameshwaram Strong Glass (P) Ltd. v. The ITO (172 ITD 571) — Cited in 15 Judgments | BharatTax