Addition to share capital only in respect of actual receipt of consideration: HP High Court

PCIT Vs I.A. Hydro Energy (P) Limited (Himachal Pradesh High Court)

The chief justice bench of HP High court was considering the issue in this case when shares were allotted at a premium of Rs 90/- per share to loan creditors whose balance was outstanding in the books. The DCF valuation was rejected by the AO as being bogus alleging no connection with actual affairs of the Company. It was argued by the assessee that the right to chose the method DCF or NAV method was with the assessee and as such the addition was without jurisdiction.

The Tribunal went further and observed t

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