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2023 (10) TMI 918 - ITAT RAIPURAddition u/s. 56(2)(viib) - excess consideration received against issue of shares exceeding the fair market value of shares - case of the assessee company was selected for limited scrutiny for verifying the applicability of Section 56(2)(viib) as regards the “large share premium” received during the year under consideration - HELD THAT:- Addition made u/s. 56(2)(viib) which, as stated by the Ld. AR and, rightly so, is primarily based on the valuation of the land at Village Karanja, Bhilai. Although it is the claim of the Ld. AR that the land under consideration had been converted into diverted land, i.e., non-agricultural land for industrial usage (Dal Mill), which fact he had tried to justify by referring to the valuation report of the government approved valuer, but the said factual position had not been appreciated by the A.O while framing the assessment. The matter in all fairness requires to be revisited by the A.O who shall, in the course of set-aside proceedings, verify the aforesaid claim of the assessee, i.e., as to whether or not the 1.82 hectares of land which was originally purchased by it at Village Karanja, Bhilai on 18.06.2013 as an “agricultural land,” had thereafter, been converted by diversion letter dated 09.05.2014 into land for an industrial purpose (Dal Mill.). If the claim of the assessee company is found to be in order, then the A.O. shall determine the FMV of the said land by making reference to the District Valuation Officer (DVO). Maintainability of the claim of the assessee, that as per government guidelines (Rule 7), the value of the agricultural land at Vill. Karanja, Bhilai, as per the said rule, was to be subjected to a multiple factor of 2.5 for arriving at the value of the land in case the same is converted into diverted land shall also be looked into by the lower authorities in the course of the set-aside proceedings. Set aside the order of the CIT(Appeals) and restore the matter to the file of the A.O. for fresh adjudication. Grounds of appeal raised by the assessee company are allowed for statistical purposes in terms of the aforesaid observations.
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