Section 56(2)(viib) Inapplicable to Holding-Subsidiary Share Issuance: ITAT Delhi

Oyo Hotels & Homes Pvt. Ltd. Vs PCIT (ITAT Delhi) The Income Tax Appellate Tribunal (ITAT), Delhi, has quashed a tax revision order against Oyo Hotels & Homes Pvt. Ltd., ruling that Section 56(2)(viib) of the Income Tax Act, 1961, does not apply to transactions involving the issuance of shares between a subsidiary and its 100% holding company. The ruling came in response to an appeal filed by OYO against a revisionary order passed by the Principal Commissioner of Income Tax (PCIT), Delhi-7, under Section 263 of the Act. The dispute arose when OYO, a wholly owned subsidiary of Oravel St...