Case Law Details
CIT Vs M/s. Vaani Estates Pvt. Ltd. (Madras High Court)
Having heard the learned counsel for the parties and considering the aforesaid provisions, we are of the opinion that the learned Assessing authority was required to undertake the exercise of fact finding by determining the Fair Market Value of the Shares in question as required in the Explanation to Section 56 as quoted That exercise been done, the matter deserves to be remanded back to the learned Assessing Authority for undertaking the said fact finding exercise. The Assessee will be free to raise all factual and legal contentions including the point about the said amount being treated as ‘gift’ from mother to daughter. The Assessee may also seek necessary clarification from the Central Board of Direct Taxes on administrative side. Thus, the matter was remitted back to the AO.
FULL TEXT OF THE HIGH COURT ORDER / JUDGMENT
The Revenue has filed this Tax Case (Appeal) under Section 260-A of the Income Tax Act by raising the following purported substantial questions of law arising from the order passed by the Income Tax Appellate Tribunal dated 27.8.2018 by which, the learned Tribunal allowed the Assessee’s Appeal for the Assessment Year 2014-2015 and held that Section 56(2)(viib) of the Act cannot be invoked in the case of the Assessee for bringing to tax the amount brought into the Assessee Company Mrs.Sasikala Ragupathy, the mother for allotment of Equity Shares in her favour with a very high premium of RS.23.32 Crores on issuance 10,100 Shares at a premium of RS.23.31 crores:-
“i) Whether, on the facts and circumstances of the case and in law, the Tribunal was justified in deleting the addition made under Section 56(2)(viib)?
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