PCIT v. Cinestaan Entertainment Pvt. Ltd. (2021) 433 ITR 82/ 199 DTR 345/ 320 CTR 381 (Delhi) (HC) Editorial : Order of Tribunal in PCIT v. Cinestaan Entertainment Pvt. Ltd (2019) 180 DTR 65/ 200 TTJ 459 / 177 ITD 809 (Delhi)(Trib.),affirmed .

S. 56 : Income from other sources – DCF Method – Receipt of consideration for issue of shares in excess of their market value – Valuation of shares- Following the prescribed method – Addition based on estimate is held to be not justified – Deletion of addition is held to be justified [ S.56 (2)(viib ) , 68, R 11UA (2)(b) ]

Dismissing the appeal of the revenue the Court held that the shares had not been subscribed to by any sister concern or closely related person, but by outsider investors. The methodology adopted was a recognised method of valuation and the Department was unable to show that the assessee adopted a demonstrably wrong approach, or that the method of valuation was made on a wholly erroneous basis, or that it committed a mistake which went to the root of the valuation process. The deletion of addition  by the Tribunal is held to be was justified.( AY.2015-16)