Assessee issued 10,42,658 shares having face value of Rs. 10 per share at premium of Rs. 23.50 per share. Fair market value (FMV) of these shares was determined by Chartered Accountant on basis of Discount Cash Flow (DCF) method \u00a0AO \u00a0rejected\u00a0 valuation and determined FMV of shares at certain amount on basis of Net As and excess premium charged\u00a0 as income from other sources under S. 56(2)(vii) of the Act which was confirmed by CIT (A). On appeal Tribunal held that, Valuation done by Chartered Accountant\u00a0 is rejected as the assessee failed to prove projection \/estimation was done on scientific method. Matter was to be restored to AO\u00a0 who would scrutinize valuation report and, adopt own valuation if not satisfied with explanation of assessee; however, basis of valuation would be DCF method and he could not change method of valuation which was opted by assessee.\u00a0 ( AY.2014 -15)<\/p>\n","protected":false},"excerpt":{"rendered":"
S. 56 : Income from other sources-Fair market value of shares- Direct Cash Flow (DCF) method-Valuation done by Chartered Accountant is rejected\u2013Failure to prove projection \/ estimation was done on scientific method-Matter was to be restored to AO who would scrutinize valuation report and, adopt own valuation if not satisfied with explanation of assessee; however, basis of valuation would be DCF method and he could not change method of valuation which was opted by assessee. [S.56(2)(viib), 11UA(b)]<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[1],"tags":[],"class_list":["post-4457","post","type-post","status-publish","format-standard","hentry","category-digest"],"acf":[],"jetpack_featured_media_url":"","jetpack_shortlink":"https:\/\/wp.me\/p9S2Rw-19T","jetpack-related-posts":[],"jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts\/4457","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/comments?post=4457"}],"version-history":[{"count":2,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts\/4457\/revisions"}],"predecessor-version":[{"id":6183,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts\/4457\/revisions\/6183"}],"wp:attachment":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/media?parent=4457"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/categories?post=4457"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/tags?post=4457"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}