Provisions of section 56(2)(viia) cannot be invoked on buyback of own share

DCIT Vs TPS Infrastructure Ltd (ITAT Delhi) Undisputedly, the assessee company, during the relevant financial period had purchased its own 130915 shares @ Rs.78/- per share from its associate concerns in the month of March, 2013. The AO picked up the issue and made addition u/s 56(2)(viia) of the Act by taking out of Rs.292/- per share. It is the claim of the assessee before the ld.CIT(A) that the assessee company has bought back its own shares under buy back scheme and the same has to be extinguished by reducing the paid-up capital of the assessee company. A combined reading of the provisions...