TMI Blog2019 (11) TMI 1424X X X X Extracts X X X X X X X X Extracts X X X X ..... 11-2019 - Shri N.K.Saini, VP And Shri Rajpal Yadav, JM Assessee by: Shri Sudhir Sehgal, Adv. Revenue by: Shri M.P. Diwedi, Sr.DR ORDER Rajpal Yadav, Assessee is in appeal before the Tribunal against order of the ld.CIT(A)-2, Chandigarh passed for the Asstt.Year 2013-14. 2. Grounds of appeal taken by the assessee were not in consonance with Rule 8 of the Income Tax (Appellate Tribunal) Rules, 1963 - they are descriptive and argumentative in nature. However, the assessee has amended these grounds of appeal and filed fresh grounds wherein it has taken four grounds. A perusal of these grounds would reveal that grievance of the assessee revolves around single issue viz. the ld.CIT(A) has erred in confirming the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s of the assessee. It was also brought to the notice that promoters who have subscribed these shares were facing financial problem, and ultimately cheques were not encashed in subsequent year also. The ld.AO has rejected this contentions of the assessee on the ground that since the assessee has been following mercantile system of accounting, therefore, the moment it has received the cheques for sale of those shares, it is to be construed that right to receive the money has accrued to it, and the alleged amount deserved to be assessed under section 56(2)(viib) of the Act. 4. Dissatisfied with the assessment order, the assessee carried the matter in appeal before the ld. First Appellate Authority. It reiterated its contentions. However, th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... edited in its accounts. Let us take note of section 56(2)(viib) of the Act, which reads as under: 56(2)(viib) where a company, not being a company in which the public are substantially interested, receives, in any previous year, from any person being a resident, any consideration for issue of shares that exceeds the face value of such shares, the aggregate consideration received for such shares as exceeds the fair market value of the shares: 7. A perusal of this section would reveal that the expression receive employed in this clause would indicate that the assessee should have actually received the amounts, and not a notional one, because in various authoritative pronouncements it has been construed that the amounts should have be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Hon'ble Madhya Pradesh High Court. 7. In the case of Panna S. Khatau (supra) cited by the learned DR, both sections 68 and 56(2)(vi) were held to be applicable by the Tribunal but no concrete or cogent reasons were given to justify the applicability of section 68 to the credits not involving any receipt or inflow of cash in the relevant year. Moreover, the view taken by the Tribunal in the said case is contrary to the decision of Hon'ble Calcutta High Court in the case of Jatia Investment Co. (supra) relied upon by the ld. CIT(A) to give relief to the assessee on issue under consideration in the present case. In the said case, the three NBFCs had taken loans from proprietary concern belonging to the same group. Since the sai ..... X X X X Extracts X X X X X X X X Extracts X X X X
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