Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2020 (1) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2020 (1) TMI 913 - AT - Income TaxComputation of capital gains - value of consideration for the purpose of computation - HELD THAT:- Value of the assets taken over by the company should be considered as the full value of consideration for the purpose of computation of capital gains under the Act. In this case, the full value of consideration is ₹ 2,70,69,200/-. This is also, the cost of acquisition of assets. As the cost of acquisition and the full value of consideration received on sale are the same figure, no capital gains has accrued or was received by the assessee. Thus, the addition under the head capital gains is hereby deleted. Correct head of income - capital gain or Income from other sources - AO valuing the shares received by the assessee from M/s. J.S. Tradex Pvt. Ltd. under Rule 11UA r.w.s. 56(2)(vii)(c) - HELD THAT:- When the assessee has been allotted certain shares as consideration for property transfer, then the question of value of those shares by invoking Section 56(2)(vii)(c) of the Act, does not arise. When a value is fixed for a share allotted, it reflects the market value of the asset transferred. It is not the case of the Assessing Officer that the assessee has not valued the assets while transferring the same to the company. What is to be considered is that this exchange/barter is on a particular date. When the exchange was on 27/03/2012 and when the shares were allotted on 27/03/2012, the Assessing Officer seeks to value the already allotted shares on 31/03/2012 i.e., after allotment of 40,000 equity shares at a premium of ₹ 400/- per share which gave the company premium of ₹ 1,56,00,000/-. This is not permissible. Such method of computation is not laid down under any provision of the Act. Thus, the same is not in accordance with law. In view of the above discussion, we delete, both the addition made under the head "Capital Gain" as well as under the head "income from other sources" on the issue of transfer. Addition u/s 14A r.w.r. 8D - HELD THAT:- set aside to the file of the Assessing Officer for fresh adjudication, in accordance with law. The Assessing Officer shall apply the judgment of the Special Bench of the ITAT in the case ACIT v. Vireet Investments (P) Ltd. [2017 (6) TMI 1124 - ITAT DELHI] and take into account only those investments which are dividend yielding with respect to disallowance u/s 14A r.w.r. 8D. In the result, Ground No. 3 is allowed for statistical purposes. Suppression of closing stock being gold - HELD THAT:- Disallowance deleted as the total closing stock of gold which was transferred is ₹ 1.99 Crores and this addition, is miniscule and not supported with cogent evidence.
|