Cost of acquisition as FMV of ESOP shares treated as perquisite unsustainable

Anil Bhansali Vs ACIT (ITAT Hyderabad)

Held that payment of federal taxes on the different between FMV and the grant price establishes that assessee is paying tax treating the value of shares as perquisite. Accordingly, provisions of section 49(2AA) are applicable. Cost of acquisition of share cannot be FMV.

Facts-

During the course of assessment, AO noticed that the assessee had acquired 2,274 shares of M/s Microsoft Corporation in FY 2001-02 with a grant price of

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