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Tax Publishers Asstt. CIT v. Sri Manoj Arjun Menda [ITA No. 1710/Bang/2016 and ITA No. 1707/Bang/2017, dt. 4-1-2021] : 2021 TaxPub(DT) 167 (Bang-Trib) FMV substitution for share sale agreement and re-computation of capital gains *Facts:* Assessee along with certain others had sold their shares and debentures of a Private company to one Ambuja Housing & Urban Infrastructure Company Limited thru a share purchase agreement and the resultant capital loss was offered as carry forward. It was the case of the assessing officer that the consideration received for the said transfer was incorrect as mentioned in the share purchase agreement and he decided to reassess the said consideration by applying the Net Asset Value (NAV) method of the underlying shares which was the FMV and subjected the balance to capital gains. On appeal the Commissioner (Appeals) held the plea of the assessee that there was no provision to substitute the FMV by the assessing officer. The action of assessing officer was annulled. Aggrieved revenue went in further appeal -- Held in favour of the assessee that the substitution of FMV/NAV by the assessing officer was incorrect as held by the Commissioner (Appeals) as there was no provision in the statute for shares. *Applied:* George Henderson & Co. Ltd. (1967) 66 ITR 622 (SC) : 1967 TaxPub(DT) 0360 (SC) Arjun Menda in ITA No. 1720/Bang/2016 (Order, dated 20-2-2020) (Bang-ITAT) *Editorial Note:* Section 50D in the statute which deems FMV as consideration with effect from 1-4-2013 is also limited in scope.

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Asstt. CIT v. Sri Manoj Arjun Menda [ITA No. 1710/Bang/2016 and ITA No. 1707/Bang/2017, dt. 4-1-2021] : 2021 TaxPub(DT) 167 (Bang-Trib)

FMV substitution for share sale agreement and re-computation of capital gains

Facts:

Assessee along with certain others had sold their shares and debentures of a Private company to one Ambuja Housing & Urban Infrastructure Company Limited thru a share purchase agreement and the resultant capital loss was offered as carry forward. It was the case of the assessing officer that the consideration received for the said transfer was incorrect as mentioned in the share purchase agreement and he decided to reassess the said consideration by applying the Net Asset Value (NAV) method of the underlying shares which was the FMV and subjected the balance to capital gains. On appeal the Commissioner (Appeals) held the plea of the assessee that there was no provision to substitute the FMV by the assessing officer. The action of assessing officer was annulled. Aggrieved revenue went in further appeal --

Held in favour of the assessee that the substitution of FMV/NAV by the assessing officer was incorrect as held by the Commissioner (Appeals) as there was no provision in the statute for shares.

Applied:

George Henderson & Co. Ltd. (1967) 66 ITR 622 (SC) : 1967 TaxPub(DT) 0360 (SC)

Arjun Menda in ITA No. 1720/Bang/2016 (Order, dated 20-2-2020) (Bang-ITAT)

Editorial Note: Section 50D in the statute which deems FMV as consideration with effect from 1-4-2013 is also limited in scope.