PR. COMMISSIONER OF INCOME TAX, CENTRAL - II, NEW DELHI vs M/S GLOBE CAPITAL MARKET LTD.

Judgment text excerpt

$~1 * IN THE HIGH COURT OF DELHI AT NEW DELHI % Date of Decision : 07.04.2026 + ITA 364/2024 PR. COMMISSIONER OF INCOME TAX, CENTRAL - II, NEW DELHI .....Appellant Through: Mr. Vipul Agrawal, SSC, Mr. Lakshi Shriwal, JSC, Ms. Harshita Kotru and Mr. Gaoraang Ranjan, Advs. versus M/S GLOBE CAPITAL MARKET LTD. .....Respondent Through: Mr. Sumit Lalchandani and Ms. Ananya Kapoor, Advs. CORAM: HON'BLE MR. JUSTICE DINESH MEHTA HON'BLE MR. JUSTICE VINOD KUMAR JUDGMENT REPORTABLE Per DINESH MEHTA, J. (Oral) 1. The order under challenge is the one, passed by the Income Tax Appellate Tribunal Delhi Bench “F”: New Delhi (hereinafter referred to as ‘the Tribunal’) whereby the appeal filed by the Income Tax Department against the order dated 30.01.2023 passed by the Commissioner of Income Tax (Appeals) (hereinafter referred to as ‘CIT(A)’) was rejected. 2. The appeal before the CIT(A) was preferred by an assessee engaged in the business of share broking and clearing of trades, in which case, during the course of assessment proceedings under section 153A of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act of 1961’), the Assessing Signature Not Verified Signed By:PRAMOD KUMAR VATS ITA 364/2024 Page 1 of 13 Signing Date:15.04.2026 09:58:44 Officer (AO) had raised a concern regarding the buyback of shares and applied the provisions of section 56(2)(x) of the Act of 1961. 3. The AO found that during the AY 2018-19, the assessee company made buyback of 28,62,500 equity shares at Rs.313.40 per share totalling to Rs.89,71,07,500/-, whereas the fair market value of each share as per Rule 11UA of the Income Tax Rules, 1962 (hereinafter referred to as ‘the Rules of 1962’) was Rs.370.46. Difference of Rs. 57.06 (Rs. 370.46 - Rs.313.40) per share, multiplied by the number of shares