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2018 (3) TMI 585 - HC - Income TaxReopening of assessment - addition u/s 56 - transaction in shares - adequate consideration - Held that:- Section 56(2)(viia) was brought in the statute book only w.e.f. 1st June, 2010 i.e. for AY 2011-12. In this case, we are concerned with shares purchased by the Petitioner in March, 2010 i.e. Assessment Year 2010-11. Section 56(2)(viia) not being retrospective, would have no application. Thus, it was submitted that there was no reason to believe that there was any income on account of short fall in consideration paid during the AY 2010-11. The order disposing of the objections, does not deal with any of the contentions raised by the Petitioner. The entire exercise of raising objections and the Assessing Officer taking second look at the impugned notice is turned into an empty formality, if the objections are not taken into consideration while disposing of the same. Assessing Officer could not have any reason to believe that income chargeable to tax has escaped Assessment, as prima facie, there was no income arising on account of short payment of consideration for the subject Assessment Year in case of a limited Company such as the Petitioner, prior to introduction of Section 56(2)(viia). Thus, the artificial meaning of income sought to be canvassed by the Revenue, came into the statute only w.e.f. 1st June, 2010 i.e. after the impugned transaction i.e. AY 2010-11.
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