“valuation of shares”

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

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

valuation based on quantitative information alone will not be adequate for a real valuation. It should also recognized that the method of valuation of shares would vary, depending on purpose for which it is to be used. 1.2 A clear understanding of the purpose of valuation is undoubtedly important ... valuation of IT and other export-driven companies. 2.1 The potential earning power of a company is generally a paramount factor for valuation of share but there may be occasions, especially in valuations for compensation, where other considerations become relatively more important. In the absence of any other special motive

ACIT, Central Circle- 13, New Delhi vs. Electrical & Electronics India Ltd., Kolkata

In the result, the appeal filed by the revenue is dismissed

Bench: Sh. N. K. Billaiya & Ms. Astha Chandraassessment Year: 2015-16 Acit Electrical & Electronics Central Circle-13 India Ltd. New Delhi Vs. Business Communication Centre, 21 Parsi Church Street, Opp. 18 Ezra Street, Kolkata West Bengal - 700001 Pan No.Aaace5419J (Appellant) (Respondent) Appellant By Sh. Vivek Upadhyay, Sr. Dr Respondent By Sh. Salil Aggarwal, Advocate Sh. Madhur Aggarwal, Advocate Sh. Shailesh Gupta, Ca Date Of Hearing: 06/11/2023 Date Of Pronouncement: 10/11/2023 Order Per N. K. Billaiya, Am: This Appeal By The Revenue Is Preferred Against The Order Of The Cit(A)-26, New Delhi Dated 27.08.2018 Pertaining To A.Y.2015-16. 2. The Grievance Of The Revenue Read As Under :- 1. Whether On The Facts & In The Circumstances Of The Case, Hon'Ble Cit(A) Is Erred In Deleting The Addition To Rs.5,63,34,120/- U/S 56(2)(Viia) Of The Income Tax Act, 1961. 2. Whether On The Facts & In The Circumstances Of The Case, Hon'Ble Cit(A) Is Erred In Deleting The Addition Of Rs.16,06,000/-On Account Of Business Loss Incurred On Sales Of Shree Shaleen Taxtiles Ltd. 3. Whether On The Facts & In The Circumstances Of The Case, Hon'Ble Cit(A) Is Erred In Deleting The Addition Of Rs.1,59,777/-On Account Of Business Loss On The Valuation Of Shares Of M/S Cressanda Solution Ltd. 4. The Order Of Ld. Cit(A) Is Erroneous & Not Tenable In Law & On Facts. 5. The Appellant Craves Leave To Add, Alter Or Amend Any/All Of The Grounds Of Appeal Before Or During The Course Of The Hearing Of The Appeal.

case, Hon'ble CIT(A) is erred in deleting the addition of Rs.1,59,777/-on account of business loss on the valuation of shares of M/s Cressanda Solution Ltd. 4. The order of Ld. CIT(A) is erroneous and not tenable in law and on facts. 5. The appellant

Picture Time Digiplex Private Limited, New Delhi vs. ACIT Circle-19(2), New Delhi

Bench: Sh. G.S.Pannu, Hon’Ble & Sh. Anubhav Sharmam/S. Picture Time Digiplex Vs. Acit, Private Limited Circle-19(2), B-19, Defence Colony, New Delhi South Delhi, New Delhi Pan: Aaicp2250Q (Appellant) (Respondent)

However, Ld. CIT(A) has not shown any indulgence on this aspect and considering certain observations of the Chartered Accountant report of the valuation of shares sustained the order of the AO. 6. The bench is of considered view that Ld. CIT(A) has fallen in error in not taking

Gopesh Fabrics P.Ltd, New Delhi vs. ITO, Ward 1(3), Faridabad

Appeal stands allowed accordingly

Bench: Shri Shamim Yahya & Shri Kul Bharat[Assessment Year: 2016-17]

bank pass book, name of the shareholders to whom the shares were allotted during the year at premium along with the valuation of shares as per the provisions of Rule llUA(c) of the income Tax Rules 1962. Apart from that, the assessee company has also filed the copy

Breezefresh Dairy and Agro Farms Pvt. Ltd., New Delhi vs. ITO, Ward- 5(2), New Delhi

In the result, the appeal of the assessee in ITA No

Bench: Shri N.K. Billaiya & Shri Kul Bharat

application of his mind, and without verifying the projections with the ground realities or the results of similar projects in industry, submitted the valuation of shares ignoring the fact that no business activity was carried out in the earlier years by the company. 11. The Assessing Officer further observed that ... Officer revolves around the observation that the valuer, without application of his mind and without verifying the projections with ground realties, submitted the valuation of shares which is based on zero activity of the assessee. 17. These observations of the Assessing Officer are not accepted on finding the fact that

ACIT Circle-59(1), New Delhi vs. Sanjay Singhal & Sons (HUF), New Delhi

In the result, the appeal of the Revenue is dismissed

Bench: Sh. C. M. Gargdr. B. R. R. Kumarita No. 281/Del/2021 : Asstt. Year : 2015-16 Acit, Vs Sanjay Singhal & Sons (Huf), Circle-59(1), 9-110, Saraswati Kunj, 8, Alipur New Delhi Road, Delhi-110054 (Appellant) (Respondent) Pan No. Aaihs6800C Assessee By : Sh. Amit Goel, Ca Revenue By : Sh. Amit Katoch, Sr. Dr Date Of Hearing: 17.07.2023 Date Of Pronouncement: 16.10.2023 Order Per Dr. B. R. R. Kumar:

arriving at FMV of shares sold before that date. The Finance Act, 2014 relevant of AY. 2015-16 prescribes only one method of valuation of shares i.e. at Book Value. By this method the net worth of the entity would be same as its share capital is Rs.3 ... then also, shares will be valued at face value alone. In view of these facts the AO held that appellants plea about fair valuation of shares before selling 5 Sanjay Singhal & Sons (HUF) them appears to be without any basis and is an attempt to impact legitimacy to otherwise unexplained

ACIT Circle-15(2), New Delhi vs. Lifestyle Probuild Pvt Ltd, Ghaziabad

In the result, this appeal by the Revenue stands dismissed

Bench: AO; that valuation report dated 15.03.2012 prepared by the Chartered Accountant as per rule 11UA

company was constructing a hotel at McLeodganj, Dharamshala which is famous for the seat of His Holiness Dalai Lama; that in support of valuation of shares, the AR for the assessee has filed two valuation reports dated 15.03.2012 and 09.03.2015 before AO; that valuation report dated 15.03.2012 prepared ... history after fresh valuation done by the company on 09.03.2015; that hence, revised valuation report dated 09.03.2015 is to be considered for valuation of shares. 4.1 Thereafter, ld. CIT (A) elaborately considered the facts and passed the following order :- “6.10 As regards valuation of shares, the Ld. AR submitted that

Clearmedi Healthcare Pvt Ltd, New Delhi vs. ACIT Circle 6(1), New Delhi

In the result, this appeal of the assessee stands allowed for

Bench: Shri Shamim Yahya & Shri Anubhav Sharma[Assessment Year: 2013-14]

share. The CA computed the value per share on the basis of discounted cash flow method. The discounted cash flow method of valuation of shares was allowed to be used by Income Tax (15" Amendment) Rules, 2012 w.e.f. 29.11.2012. Therefore, the Assessing Officer held that assessee was not entitled ... purposes of section 56 of the IT Act, 1961. The Assessing Officer observed that the valuation report recommended the valuation of shares at Rs.250.19 per share when it issued 57,910 shares. But the assessee used this valuation report for entire number of shares i.e. 1,50,775. The projections

DCIT Circle-11(1), New Delhi vs. Hometrail Buildtech Pvt Ltd, New Delhi

In the result the appeal of the Revenue in ITA No

Bench: Shri N.K. Billaiya & Shri Anubhav Sharma

viib) of the Income-tax Act, 1961 [the Act, for short] holding that the DCF Method is the correct method for valuation of shares. 3. Representatives of both the sides were heard at length. Case records carefully perused. Relevant documentary evidence brought on record duly considered in light of Rule ... share to M/s Max Healthcare Institute Limited and received share premium of Rs. 8 crores. 7. The assessee was asked to furnish valuation of shares as on date of allotment. The assessee submitted Business Valuation Report dated 09.03.2015. The value of shares as per Discounted Cash Flow [DCF] Method

ACIT, Circle-8(1), New Delhi vs. Etawah Chakeri (Kanpur) Highway P.Ltd, New Delhi

In the result the appeal of the Revenue in ITA No

Bench: Shri N.K. Billaiya & Shri Anubhav Sharma

crore equity shares of Rs.10/- at a premium of Rs.90/- and entire capital was subscribed by promoters shareholders only. 12. In support, of valuation of shares at a premium of Rs.90/- per share, valuation report of M/s M. Mehta & Co. Chartered Accountants dated 31.05.2012 was submitted, who valued the shares ... left to the consideration and wisdom of experts in the field of accountancy, having regard to the imponderables which enter the process of valuation of shares. 20. The Assessing Officer has nowhere demonstrated that the methodology adopted by the assessee is not correct. The Assessing officer has simply rejected

Rivet Electricals Pvt Ltd, Delhi vs. Pr.CIT- Faridabad, Faridabad

The Appeal of the assessee stands allowed

Bench: Initiating The Proceeding As No Enquiry Was Made By Pr. Cit In Arriving At Conclusion Which Is Contrary In View Of The Jurisdictional & Other High Courts & The Apex Court. D. That Once The Sums Have Been Received Through Banking Channels & Complete Evidences Was Provided During The Course Of The Assessment, Suspicion Raised Purely On Assumptions Is Wholly Unsustainable In Law.

valuation arrived at as per Rule 11 UA of the Income Tax Rules, 1962. Ld. Pr. CIT has not pointed out that the valuation of shares as arrived at by the assessee, is not correct. In absence of such finding and coupled with the fact that

Bueno Foods Private Limited, New Delhi vs. ACIT Circle-5(1), New Delhi

In the result, the appeal of the assessee is allowed for

Bench: SHRI M. BALAGANESH (Accountant Member), SHRI ANUBHAV SHARMA (Judicial Member)

observed that the assessee had not provided any documentary proof of it being a start up company. In any case, the valuation of shares using DCF method suffered from defects in as much as the assessee did not furnish factual evidence of nature of work, business model etc and projections ... Rules using DCF method. We find that Rule 11UA of the Rules duly prescribe DCF method as one of the approved methods of valuation of shares and the law provides an option to the assessee either to adopt NAV or DCF method for determining the Page 7 of 11 Bueno