Nagarjuna Hospitals Private Limited, Vijayawada V. Assistant Commissioner of Income Tax, Circle-1(1), Vijayawada

MA 33/VIZ/2022

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Nagarjuna Hospitals Pvt. Ltd. filed a miscellaneous application against the order of the Income Tax Appellate Tribunal, which had earlier dismissed their appeal concerning the assessment year 2015-16. The dispute centered on the share premium received by the company and the method of valuation of shares, which were scrutinized under section 263 of the Income Tax Act by the Principal Commissioner of Income Tax. The Tribunal's earlier decision was based on the absence of detailed discussion in the assessment order by the Assessing Officer, despite the assessee having provided all necessary documents and explanations during the assessment proceedings.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 135869 (ITAT-VISAKHAPATNAM)
• Duration Of Justice: 4 month(s) 24 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 15-02-2023
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 22-12-2022
• Assessment Year: 2015-2016
• Appeal Filed On: 22-09-2022
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Revision of order
• Section: 263; 56(2)(vii)(b); 64

Judgement Text

आयकरअपीलीयअधिकरण, धिशाखापटणम पीठ, धिशाखापटणम IN THE INCOME TAX APPELLATE TRIBUNAL, VISAKHAPATNAM BENCH, VISAKHAPATNAM श्री द ु व्वूरु आर एल रेड्डी, न्याधयक सदस्य एिं श्री एस बालाकृ ष्णन, लेखा सदस्य के समक्ष BEFORE SHRI DUVVURU RL REDDY, HON’BLE JUDICIAL MEMBER & SHRI S BALAKRISHNAN, HON’BLE ACCOUNTANT MEMBER Miscellaneous Application No.33/Viz/2022 Arising out of I.T.A.No.186/Viz/2021 (ननधधारण वर्ा / Assessment Year : 2015-16) M/s Nagarjuna Hospitals Pvt. Ltd. D.No.8-102, Kanuru, Vijayawada [PAN : AAACN 7476J] Vs. Asst.Commissioner of Income Tax Circle-1(1) Vijayawada अपीलधथी की ओर से/ Appellant by : Shri C.Subrahmanyam, AR प्रत्यधथी की ओर से / Respondent by : Shri O.N.Hari Prasada Rao, DR सुनवधई की तधरीख / Date of Hearing : 23.12.2022 घोर्णध की तधरीख/Date of Pronouncement : 16.02.2023 O R D E R Per Shri Duvvuru R.L.Reddy, Judicial Member : This miscellaneous application is filed by the assessee against the order passed by the Income Tax Appellate Tribunal, Visakhapatnam in ITA No.186/Viz/2021 dated 23.08.2022 for the Assessment Year (A.Y.) 2015- 16, arising out of the order passed u/s 263 of the Income Tax Act, 1961 (in short ‘Act’) by the Ld.Principal Commissioner of Income Tax [in short ‘Ld.PCIT’]. 2 MA No.33/Viz/2022, A.Y.2015-16 Nagarjuna Hospitals Pvt. Ltd, Vijayawada 2. The Ld.AR, with regard to the observation of the Tribunal in respect of share premium, submitted that, during the course of assessment proceedings, in response to notices received from the AO, the assessee submitted various information which is placed in paper book filed before ITAT at page 23 to 32, more particularly, the relevant issue pertaining to share premium at page 26 to 32, wherein the assessee submitted before the AO, allotment of shares at premium, allotment returns filed with ROC, ledger copies of share premium, copies of valuation report from independent auditors. The AO has verified and made enquiries with respect to share premium. The Ld.AR further submitted that the Hon’ble High Court of Andhra Pradesh held that once the AO has called for details and examined it, though there was no discussion in the order, such order cannot be erroneous order. He, therefore, pleaded to reconsider the observation of the Tribunal with regard to share premium. 3. It was further submission of the Ld.AR that Ground No.3 regarding observations of the PCIT with respect to share valuation, which according to PCIT is not in accordance with provisions laid down u/s 56(2)(vii)(b) r.w.r.11UA was not adjudicated by the Tribunal. The ground was raised to counter the findings of the PCIT with regard to method of valuation of shares suggested by PCIT i.e. NAV method, as against DCF method followed 3 MA No.33/Viz/2022, A.Y.2015-16 Nagarjuna Hospitals Pvt. Ltd, Vijayawada by the assessee and the finding of the PCIT is contrary to the provisions of the Act. The assessee relied on various case laws as filed in paper book page No. 64 to 88 and submitted that section 56(2)(viib) r.w.r.11UA provides two methods of valuation of shares with a leverage to the assessee to adopt either of these two and the finding of the PCIT is contrary to law. He, therefore, requested to recall the order. 4. The Ld.DR relied on the order of the Hon’ble ITAT. 5. We have heard both the sides and perused the order of the Hon’ble ITAT in I.T.A. No.186/Viz/2021 dated 23.08.2022. We find that the Ld.PCIT in para No.5 of his order u/s 263 has observed as follows : “5. The submissions of the assessee are considered. After going through the submissions made, it is seen that, the number of NRIs from whom share premium is received in at variance to that originally stated / reported by the assessee. Also the Authorised Representative contends that all the statutory reports were submitted to the Assessing Officer which is not seen in the file. Hence, the AO is directed to verify the contention of the assessee and decide the issue in accordance with law.“ Hon’ble ITAT has rightly considered the grounds raised by the assessee and dismissed the same in the absence of discussion in the assessment order by the Ld.AO. Further, the Ld.PCIT also could not find any documents in the file. We are therefore, of the opinion that there is no mistake apparent on record in the order of the ITAT, hence, the M.A filed by the assessee is dismissed. 4 MA No.33/Viz/2022, A.Y.2015-16 Nagarjuna Hospitals Pvt. Ltd, Vijayawada 6 . In the result, the miscellaneous application of the assessee is dismissed. Order pronounced in the open court on 16 th February, 2023. Sd/- Sd/- (एस बालाकृ ष्णन) (द ु व्वूरु आर.एल रेड्डी) (S.BALAKRISHNAN) (DUVVURU RL REDDY) लेखा सदस्य/ACCOUNTANT MEMBER न्याधयक सदस्य/JUDICIAL MEMBER Dated : 16.02.2023 L.Rama, SPS आदेश की प्रतितिति अग्रेतिि/Copy of the order forwarded to:- 1. ननधधाऩरती/ The Assessee– M/s Nagarjuna Hospitals Pvt Ltd., D.No.8-102, Kanuru, Vijayawada 2. रधजस्व/The Revenue – M/s Nagarjuna Hospitals Pvt Ltd.,D.No.8-102, Kanuru, Vijayawada 3. प्रधान आयकर आयुक्त /The Principal Commissioner of Income Tax, Vijayawada 4. नवभधगीय प्रनतनननध, आयकर अपीलीय अनधकरण, नवशधखधपटणम/ DR,ITAT, Visakhapatnam 5.गधर्ा फ़धईल / Guard file आदेशधनुसधर / BY ORDER Sr. Private Secretary ITAT, Visakhapatnam