During year, assessee-company issued shares at premium of Rs. 990 per share. AO added excess share premium collected to income of assessee by invoking provisions of S. 56(2)(viib) of the Act . Tribunal held that the assessee was second level subsidiary of a company in which public was substantially interested hence would not fall under S. 56(2)(viib) of the Act. Accordingly the addition made by AO was not justified. (AY. 2015-16)
Apollo Sugar Clinics Ltd. v. DCIT (2019) 176 ITD 724 / 200 TTJ 875/ 182 DTR 142 (Hyd.)(Trib.)
S. 56 : Income from other sources – Excess share premium- second level subsidiary of a company in which public are substantially interested – Addition cannot be made. [S. 2(18), 2(24), 56(2)(viib), R. 11UA]