TMI Blog2017 (9) TMI 1590X X X X Extracts X X X X X X X X Extracts X X X X ..... ing for the Revenue also fairly states that the issue of applicability of section 68 of the Act was not urged by the Revenue before the Tribunal. It is a settled position in law as held by this court in CIT v. Tata Chemicals Ltd. [2002 (4) TMI 42 - BOMBAY High Court] that in an appeal under section 260A of the Act, the High Court can only decide a question if it had been raised before the Tribunal even if not determined by the Tribunal. Therefore, no occasion to consider the question as prayed for arises. Also the amendment to section 68 of the Act by the addition of proviso thereto took place with effect from April 1, 2013. Therefore, it is not applicable for the subject assessment year 2012- 13. So for as the pre-amended section 68 of the Act is concerned, the same cannot be invoked in this case, as evidence was led by the respondents- assessees before the Assessing Officer with regard to identity, capacity of the investor as well as the genuineness of the investment. Therefore, admittedly, the Assessing Officer did not invoke section 68 of the Act to bring the share premium to tax. - Decided in favour of assessee Whether the share premium receipt is capital in nature? - ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... A. Whether on the facts and in the circumstances of the case and in law, the Tribunal was correct to uphold the decision on Commis sioner of Income-tax (Appeals) that the share premium received by the assessee-company cannot be taxed under section 68 of the Act ignoring the ratio laid down by this court in its decision reported in the case of Major Metals Ltd. v. Union of India [2013] 359 ITR 450 (Bom) ? B. Whether on the facts and in the circumstances of the case and in law, the Tribunal as well as the Commissioner of Income-tax (Appeals) was right in deleting addition made by the Assessing Officer, by hold ing that the share premium receipt is capital in nature ? 4. During the previous year relevant to the subject assessment year 2012- 13, all the respondent-assessees had increased their share capital by issuing its shares at a premium. During the course of assessment, the Assessing Officer negatived the respondent-assessees contention that the share premium received by it on issue of shares was a capital receipt and hence could not be taxed as income. The Assessing Officer held that the respondent-assessees did not have any significant business at the time of issue ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the hon'ble apex court in G. S. Homes and Hotels P. Ltd. v. Deputy CIT (Civil Appeal Nos. 7379-7380 of 2016 rendered on August 9, 2016)- [2016] 387 ITR 126 (SC) wherein, the decision of the Karnataka High Court holding that the amount received on account of shares from various shareholders be treated as business income was reversed. The impugned order also made reference to the unreported decision of this court in Idea Cellular Limited v. Union of India (Writ Petition (Lodg) No. 1462 of 2013 decided on September 12, 2013) wherein, this court while dealing with issue of non-granting of stay of demand in its writ jurisdiction has observed that any benefit which is received on capital account cannot be subject matter of Income-tax under section 28(iv) of the Act. Thus, the appeals of the Revenue were dismissed by following the decision of this court and of apex court that the receipt of share premium is on capital account and cannot be brought to tax as income. 7. In the back-drop of the above facts, we shall now decide the above two questions which arise for our consideration. 8. Regarding Question A : (a) The issue raised by the Revenue in this question is to bring ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the above case, the Settlement Commission arrived at a finding of fact that the subscribers to shares of the assessee-company were not creditworthy inasmuch as they did not have financial standing which would enable them to make an investment of ₹ 6,00,00,000 at premium at ₹ 990 per share. It was this finding of the fact arrived at by the Settlement Commission which was not disturbed by this court in its writ-juris diction. In the present case the person who have subscribed to the share and paid share premium have admittedly made statement on oath before the Assessing Officer as recorded by the Tribunal. No finding in this case has been given by the authorities that shareholder/share applicants were unidentifiable or bogus. (e) In the above view Question No. A is not being entertained in view of the decision in Tata Chemical Ltd. (supra). Accordingly, the question (A) is not entertained. 9. Regarding Question B : (a) We find that the impugned order of the Tribunal upheld the view of the Commissioner of Income-tax (Appeals) to hold that share premium is capital receipt and therefore, cannot be taxed as income. This conclusion was reached by the impugned orde ..... X X X X Extracts X X X X X X X X Extracts X X X X
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