DCIT Vs Bhavna Bharat Daftary (ITAT Mumbai)
Section 48 Cannot Borrow Tomorrow’S Price For Yesterday’s Transfer — ₹97 Crore Capital-Gain Addition Deleted
Same shares—but two different transactions
The assessee held substantial shares in Bharat Serums and Vaccines Ltd. [BSVL], an unlisted company. The dispute arose from two transfers of BSVL shares undertaken during the year under entirely different commercial circumstances.
On 30.09.2019, the assessee transferred 5,95,500 shares to Aksipro Diagnostics Pvt. Ltd. [ADPL] at ₹265 per share. At that time, ADPL was a family-controlled company owned equally by the assessee & his brother, Gautam Daftary.
The transfer was undertaken as an internal restructuring exercise to consolidate the family shareholding in BSVL under a corporate vehicle, thereby facilitating a possible future strategic divestment.
The FMV determined under Rule 11UA on the transfer date was ₹257.20 per share. Thus, the actual consideration of ₹265 per share was higher than the statutory FMV.
On 18.11.2019, the promoters subsequently entered into a Definitive Agreement with Anasamira Ltd., an Advent Group company. The agreement prescribed only a methodology for determining the price. The final consideration depended upon due diligence, fulfilment of conditions precedent, capital infusion & closing of the transaction.
Upon closing on 06.02.2020, Anasamira acquired control over ADPL. On 07.02.2020, the assessee transferred a further 12,56,053 BSVL shares to the now Advent-controlled ADPL at ₹1,893.98 per share.
