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2023 (11) TMI 235 - HC - Income TaxAddition u/s 68 - undisclosed income - investment made in shares issued at premium - HELD THAT:- The triple test u/s 68 requires an assessee to prove identity, creditworthiness, and the genuineness of the subject transaction. In this case, concededly, there is no dispute with regard to the identity of the investor. As indicated above, Adhyay was the investor. The fact that Rs. 20 crores have been invested via banking channels is not in dispute. Also not disputed that the respondent/assessee justified the premium that it had charged qua the shares by producing a valuation certificate of the Chartered Accountant. The valuation was made based on the Net Asset Value Method (NAVM). The valuation revealed that the shares of the respondent/assessee were worth Rs.200.52 per share. We find from the assessment order that the AO has taken note of the fact that if other methods were used, the valuation would have been much higher. There was on record a justification concerning the premium that the respondent/assessee received for its shares. AO asked himself the wrong question and proceeded thereafter on the wrong path. It is important to highlight, something which the Tribunal has noted, that in a query put by the AO to the representative of Adhyay, what was revealed is that it had a net worth of more than Rs.100 crores. What has come through on perusal of the record is that the respondent/assessee has furnished the details of the cheque payments and therefore, there was enough and more material available with the AO to make further inquiry into the matter. AO, instead of making further inquiries, seems to have been burdened by the fact that the premium charged was high, which, according to us, was not the correct test for making an addition u/s 68 - Decided in favour of assessee. Deduction u/s 80IB - inclusion of CENVAT Credit in the profits of assessee for the purposes of arriving at the deduction - HELD THAT:- CIT(A) went into a detailed analysis of the issue at hand and correctly drew a distinction between the CENVAT credit, which is made available to a manufacturer against the duty drawback, and the Duty Entitlement Pass Book (DEPB) certificates issued to an exporter. DEPB are “incentive profits” which are made available to an exporter who may not necessarily be a manufacturer and therefore, possibly, being ineligible for deduction u/s 80IB of the Act. Both CIT(A) as well as the Tribunal have taken note of Dharam Pal Prem Chand Ltd. [2008 (11) TMI 231 - DELHI HIGH COURT] - No substantial question of law.
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