TMI Blog2012 (9) TMI 974X X X X Extracts X X X X X X X X Extracts X X X X ..... zable value i.e. YTM method suggested by RBI, the taxing authority cannot find fault with taxpayer. As observed by Kerala High Court, the assessing authority has not come out with any suggestion / formula for computation of market value of unquoted shares. It is also not the case of the revenue that the guideline issued by the RBI for valuation is irrational. In these facts and circumstances, this Tribunal is of the considered opinion that the law laid down by the jurisdictional High Court in the cases of Nedungadi Bank Ltd (2002 (11) TMI 29 - KERALA High Court) and Lord Krishna Bank Ltd (2010 (10) TMI 860 - Kerala High Court) is applicable in the case of the present tax payer also. Directed to allow the notional loss claimed by the tax ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f litigation the assessing officer again disallowed the claim of the taxpayer on the ground that the taxpayer has not filed the balance-sheet of the respective companies where investments were made. The assessing officer placed his reliance on the orders of this Tribunal in the case of Catholic Syrian Bank Ltd in ITA Nos 284 381(Coch)/2006 dated 14-03-2008. Referring to the judgment of the Kerala High Court in Commissioner of Income-tax vs Lord Krishna Bank Ltd I.T.A. No.234 of 2009 dated 07-10-2010, the ld.representative submitted that the High Court has approved the revaluation of the securities on the basis of the guidelines prescribed by the RBI. The ld.counsel further submitted that the Kerala High Court has placed its reliance on th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ala High Court, the loss suffered by the taxpayer in revaluation of the securities has to be allowed as deduction. 5. In the case before us, the taxing authority disallowed the claim of the taxpayer on the ground that the balance-sheet of the respective companies was not filed to establish the valuation. The contention of the taxpayer is that the valuation was made on the basis of the guideline issued by RBI taking into consideration the realisable value. In fact, as seen from the order of the Commissioner of Income-tax(A), the taxpayer claimed that the revaluation was made on the basis of the guideline issued by the RBI and the value is based on realizable value. The taxpayer has also brought to the notice of the lower authorities that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e yield to maturity method adopted for valuation of securities. It is seen that the Tribunal accepted the assessee s valuation which is based on RBI guidelines. RBI being the apex body issuing guidelines to the Banks for valuation of unquoted Government securities, we feel it is the rational basis which assessee was bound to adopt. The Assessing Officer also has not come out with any formula for computation of market value of unquoted securities and he has no case that the RBI guidelines for valuation is irrational. So much so, we feel the Tribunal rightly upheld assessee s claim for valuation of unquoted Government securities based on RBI guidelines. 6. The RBI issued guidelines to value to unsecured shares on the basis of YTM, i.e. y ..... X X X X Extracts X X X X X X X X Extracts X X X X
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