Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2021 (7) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2021 (7) TMI 358 - AT - Income TaxAddition u/s 56(2)(viib) - excess premium collected on issue of equity shares from resident individuals - HELD THAT:- We find that the CBDT, after considering hardships faced by startup companies with regard to application of section 56(2(viib) of the Act, as per Gazette Notification dated 19.02.2019, has issued clarificatory notification dated 9th August, 2019 and clarified that said notification will be applicable to startup companies also where addition u/s. 56(2(viib) of the Act has been made in an assessment order before 19.02.2019, provided the assessee has subsequently submitted declaration in Form No.2 that it has satisfied conditions mentioned. In this case, the assessee has filed Form No.2 in pursuance of para 5 of Notification dated 19.02.2019 on 23rd August, 2019 and in response, the CBDT vide its notification dated 28th August, 2019 has clarified that assessee is a recognized startup from DPIIT and further, the provisions of section 56(2(viib) of the Act shall not apply to the assessee on the amounts received as consideration for issue of shares. We are of the considered view that there is no merit in arguments of the DR that the assessee is outside scope of Gazette Notification dated 19.02.2019 and hence, share premium issued on issue of shares is covered u/s. 56(2(viib). In this view of the matter and considering facts and circumstances of the case, we are of the considered view that assessee is a recognized startup from DPIIT, Ministry of Commerce & Industry, Govt. of India and hence, it is outside scope of the provisions of section 56(2(viib) of the Act, in respect of consideration received for issue of shares at premium. The learned CIT(A), after considering relevant facts has rightly deleted additions made by the Assessing Officer. Hence, we are inclined to uphold findings of the learned CIT(A) and dismiss appeal filed by the Revenue.
|