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2022 (12) TMI 107 - AT - Income TaxAddition u/s 56(2)(vii b) - value the equity shares using DCF Method - A.O was of the opinion that the assessee cannot be considered as start up, the share valuation report relied upon by the assessee is not acceptable since the projections and actual are not in conformity and the valuation report does not meant requirements of Indian Evidence Act, does not pertain to the date of issue of the shares - HELD THAT:- For the year under consideration i.e. A.Y. 2016-17 unlike previous years the Ld. A.O. has not even gone through the valuation report and opined that the report falls foul of Section 45 of the Indian evidence Act. In our considered view the Ld. AO and the CIT (A) have committed an error in not following the principal of consistency. The Coordinate Bench of the Tribunal in[2018 (10) TMI 1400 - ITAT DELHI] held that the evaluation report which is prepared by the professional such as chartered accounts or mercantile banks for which their respective professional bodies have laid down specific disclosure requirements those disclosure requirements are binding on them. Merely because the valuation report contains certain caveats and disclosures those factors are not sway the mind of the A.O or commissioner of Appeal and therefore remitted the matter to the file of the Assessing Officer for objectively evaluation of the valuation report submitted by the assessee. As per the Assessee, the Valuation report is be inconformity with the provisions of Section 56(2)(viib) read with Rule 11UA (2) of the Income Tax Rules. In our opinion, in view of the facts and the circumstances of the case, the Lower Authorities ought to have considered the valuation report of the Chartered Accountant submitted by the assessee and should have verified as to whether the said valuation report is inconformity with Section 56(2) (viib) of the Act read with Rule 11UA (2) of the Income Tax Rules or not and accordingly shoud have decided the matter by following the principal of consistency. In view of the above discussions, to render substantial justice, we remand the matter to the file of Ld. A.O. for the purpose of verifying as to whether the valuation report of the Chartered Accountant submitted by the Assessee is inconformity with the Section 56(2) (viib) of the Act read with Rule 11UA(2) of the IT Rules or not and decide the matter in accordance with law by keeping the principal of consistency in mind. Appeal filed by the assessee is partly allowed for statistical purpose.
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