{"id":65160,"date":"2026-10-26T12:49:51","date_gmt":"2026-10-26T07:19:51","guid":{"rendered":"https:\/\/itatonline.org\/digest\/grasim-industries-limited-v-dy-cit-bom-hc-www-itatonline-org\/"},"modified":"2026-10-26T12:49:51","modified_gmt":"2026-10-26T07:19:51","slug":"grasim-industries-limited-v-dy-cit-bom-hc-www-itatonline-org","status":"publish","type":"post","link":"https:\/\/itatonline.org\/digest\/grasim-industries-limited-v-dy-cit-bom-hc-www-itatonline-org\/","title":{"rendered":"Grasim Industries Limited v. Dy.CIT (Bom)( HC) www.itatonline.org"},"content":{"rendered":"<p style=\"font-weight: 400\">On writ, the Bombay High Court held that section 56(2)(x) could not be invoked merely because the subscription price of rights equity shares allotted proportionately to the assessee was lower than their fair market value. The assessee, <strong>Grasim Industries Limited<\/strong><strong>,<\/strong> subscribed to rights shares of Vodafone Idea Limited at \u20b912.50 per share, whereas the Revenue determined their fair market value at \u20b913.925 per share and sought to tax the difference of \u20b9329.03 crore under section 56(2)(x). The Court observed that the rights shares were allotted to existing shareholders in proportion to their shareholding, the assessee\u2019s percentage shareholding remained unchanged, and the Revenue had not disputed this position. The allotment of additional shares also affects the value of the existing shares; therefore, the difference between the subscription price and the prevailing market price could not automatically be regarded as an economic benefit received by the assessee. The Revenue had neither identified any acquisition of pre-existing shares from another person nor demonstrated any disproportionate benefit accruing to the assessee. Accordingly, the Court held that section 56(2)(x) could not be invoked on the facts merely to tax the difference between the subscription price and the fair market value of proportionately allotted rights shares. The Court clarified that its finding was confined to the facts of the case. <strong>(AY. 2020-21) .(WP \u00a0No. 4298 of 2026, dt. 22-10-2026)<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"<p>S. 56: Income from other sources -Rights shares allotted proportionately to existing shareholders \u2013 Difference between subscription price and fair market value cannot, by itself, be treated as income from receipt of property for inadequate consideration \u2013 Reassessment notice was quashed on merits as well as on legal grounds. [ S.56(2)(x) , 147, 148 , 148A(b) , 148A(d) , Art. 226 ] <\/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_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_feature_clip_id":0,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_post_was_ever_published":false},"categories":[21],"tags":[],"class_list":["post-65160","post","type-post","status-publish","format-standard","hentry","category-income-tax-act"],"acf":[],"jetpack_shortlink":"https:\/\/wp.me\/p9S2Rw-gWY","jetpack-related-posts":[],"jetpack_sharing_enabled":true,"jetpack_featured_media_url":"","_links":{"self":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts\/65160","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=65160"}],"version-history":[{"count":1,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts\/65160\/revisions"}],"predecessor-version":[{"id":65161,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts\/65160\/revisions\/65161"}],"wp:attachment":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/media?parent=65160"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/categories?post=65160"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/tags?post=65160"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}