Share Transfer in Family Arrangement Not Taxable: ITAT Deletes ₹489 Crore Addition

ACIT (OSD) Vs GaganInfraenergy Limited (ITAT Delhi)

The present matter involves an appeal by the Revenue and cross-objection by the assessee against the order dated 30.04.2024 passed by the National Faceless Appeal Centre (NFAC) for assessment year 2014–15. The dispute arose from an assessment order passed under Section 143(3) read with Section 254 of the Income Tax Act, 1961.

During assessment, the Assessing Officer rejected the returned loss and determined total income at ₹50.33 crore by making a major addition of ₹489.30 crore. This addition was on account of transfer of shares of Jindal Steel and Power Limited by the assessee to its group company Glebe Trading Pvt. Ltd. without consideration. The Assessing Officer treated this transaction as a “transfer” under Section 2(47) and taxed it as capital gains under Section 45. Additionally, an addition of ₹15 crore relating to unsecured loans was made.

On appeal, the CIT(A) deleted the addition relating to unsecured loans but sustained the capital gains addition. Subsequently, the Tribunal remanded the matter to the Assessing Officer for re-examination of the genuineness and validity of the share transfer, which was claimed to be part of a family realignment. In the reassessment proceedings, the Assessing Officer again treated the transaction as taxable, though allowed set-off of brought forward losses.