THE INCOME TAX APPELLATE TRIBUNAL DELHI “E” BENCH: NEW DELHI BEFORE SHRI SUDHIR KUMAR, JUDICIAL MEMBER &

SHRI MANISH AGARWAL, ACCOUNTANT MEMBER ITA No.2418/Del/2022 [Assessment Year : 2016-17]

DCIT, vs Aman Growth Fund Pvt.Ltd., Central Circle-20, L-4, Green Park Extension, New Delhi New Delhi-110016 PAN-AAACA0525B APPELLANT RESPONDENT Revenue by Shri Pravin Rawal, CIT DR Assessee by Shri Mahesh Kumar, CA, Ms. Meenal Goyal, Adv. &

Ms. Vidhi Mangla, Adv.

Date of Hearing 25.06.2025 Date of Pronouncement 14.08.2025

ORDER

PER MANISH AGARWAL, AM :

The present appeal is filed by the revenue against the order of Ld. Commissioner of Income Tax (A)-27, New Delhi [“Ld.CIT(A)”] dated 21.07.2022 in Appeal No. CIT(A), Delhi-27/10588/2018-19 passed u/s 250 of the Income Tax Act, 1961 [“the Act”] arising from the assessment order dated 27.12.2018 passed u/s 143(3) of the Act pertaining to assessment year 2016-17.

2. Brief facts of the case are that assessee is a Private Limited company and filed its return of income on 01.10.2016, declaring income of INR 18,970/-. The assessee is engaged in the business of making investments in shares, properties, security and other various assets and buy and sell of such investments. During the year under appeal, the assessee company has issued 6,28,700 equity shares having face value of Rs. 10/- each at a premium of Rs. 1350/- per share which were subscribed by two ladies namely, Smt. Surbhi Gehlot and Smt. Shahista Gehlot. The value of per equity share was valued at Rs. 1363/- by following DCF method in terms of the report of the accountant. While valuing the share, the explanation (a)(i) of section 56(2)(viib) was applied according to which the value has to be determined as per Rule 11UA of the Income Tax Rules, 1962 which provide the choosing of method at the option of the assessee. Further said explanation provides that value should be determined as per Rule 11UA or the value as determined by the assessee based on the date of issue of shares, whichever is more. However, the value at DCF method was adopted by the Assessee. The AO has discarded the valuation don by the assessee by following DCF method and worked out the market value of each share at Rs. 384/- as per NAV method and the difference of Rs. 956/- was treated as excess share premium charged which is taxable u/s 56(2)(viib). Thus, the total excess premium charged by the assessee was worked out at Rs. 60,10,37,200/- for 6,28,700 equity shares and additions were made for the same.

3. Against this order, an appeal was filed before the Ld. CIT(A) who vide impugned order dated 21.07.2022 has allowed the appeal of the assessee and deleted the additions made by the AO.

4. Aggrieved by the said order, the revenue is in appeal before the Tribunal wherein following grounds of appeal are taken by the revenue:-

1. “The Ld. CIT(A) has erred on facts and in law in allowing the appeal of the assessee and deleting the addition of Rs.60,10,37,200/- made by the AO u/s 56(2)(viib) of the Act, 1961.

2. Whether the Ld. CIT(A) is correct on facts and in law of the case in deleting the addition made by the AO and accepting the DCF method of valuation of shares instead of NAV method adopted by the AO.

3. The Ld. CIT(A) has erred on facts and in law in allowing the appeal of the assessee ignoring the fact that the valuation report of the valuer cannot be relied upon where the valuer herself failed to justify the rationale behind the variables taken by her for valuation of shares.

4. The Ld. CIT(A) has erred on facts and in law in ignoring the fact that any slight deviation of company specific beta, risk premia can yield substantially disparate valuation resulting into artificially inflated figures of value of shares in this case.

5. The Ld. CIT(A) has erred on facts and in law in ignoring the fact that the valuation of the assessee company was done on 31.03.2016 and not before the issuance of the share capital, wherein amount of outstanding loan before the issuance of share capital