Reworking Value Of Investments Held In Subsidiary By Applying DCF Method Is Permitted, Once Correctness Of Valuation Stands Proved: Delhi ITAT

The Delhi ITAT ruled that reworking the value of investments in a subsidiary using the Discounted Cash Flow (DCF) method is permissible provided the correctness of the valuation is demonstrated. The Tribunal allowed the use of the DCF method, which is a detailed financial valuation technique, provided that it is substantiated with accurate data and proper justification. This ruling provides clarity on the acceptable methods for valuation and emphasizes that accurate and verifiable valuation methods are crucial for financial assessments.