Case Studies — Real Engagement Outcomes
By CA V. Viswanathan — FCA, ACS, CFE, IBBI Registered Valuer (IBBI/RV/03/2019/12333). All case studies below are anonymised — names of parties, exact deal values, and identifying circumstances have been altered to preserve client confidentiality. Only sector, structure, methodology, and outcome are real.
Angel Tax Defence — Section 56(2)(viib) at ITAT
Sector: SaaS startup, Bangalore. Stage: Series A. Year: 2024-25.
Background: The company raised ₹38 crore at a valuation of ₹220 crore from a domestic angel-cum-VC fund. The Assessing Officer issued a Section 56(2)(viib) addition treating the entire premium component (~₹35 crore) as taxable income, on the ground that the DCF valuation in the company's Form CA report relied on aggressive assumptions (90% YoY revenue growth, 35% terminal margin) unsupported by then-available financials.
Our approach: We were retained at the CIT(A) stage. We constructed a defence around three pillars: (a) IBBI Valuer-prepared replacement valuation report applying both DCF and Berkus method, with sensitivity analysis showing the original valuation lay within a defensible range under multiple methodologies; (b) industry-comparable analysis showing five contemporaneous SaaS Series A rounds at similar revenue multiples; (c) demonstration that the founders' three-year forward projections had since materialised within ±15%, validating the original DCF assumptions ex-post.
Outcome: CIT(A) deleted the addition in full. The order was not appealed by the department within the limitation period. The company avoided a ₹10.92 crore tax demand plus interest.
FEMA Compounding — FC-GPR Delay Resolved
Sector: D2C consumer brand, Mumbai. Year: 2024.
Background: The company received foreign equity investment of USD 4.2 million from a Singapore-based investor in late 2022. Due to a misunderstanding between the company secretary and the AD-Bank, the FC-GPR (Foreign Currency-Gross Provisional Return) was filed 14 months after allotment instead of within the prescribed 30 days. RBI's compounding cell issued a show-cause notice with provisional contravention amount of ₹3.6 crore.
Our approach: We filed a comprehensive compounding application demonstrating: (a) the delay was procedural, not substantive — funds were received on time, allotment was on time, and the only failure was reporting; (b) clean prior compliance record with multiple successful FC-GPR filings; (c) genuine reasonable cause via internal email evidence showing the timing instruction was misread; (d) full pre-payment of expected compounding amount as a sign of good faith.
Outcome: RBI's compounding order reduced the contravention amount to ₹26 lakh — a 93% reduction from the provisional figure. The compounding closed without further consequence; the foreign investor's quarterly distributions resumed without disruption.
Forensic Investigation — Vendor Fraud at SaaS Company
Sector: Mid-market SaaS, Chennai. Year: 2025.
Background: The CFO flagged unusual increases in marketing-services vendor spend — ₹1.4 crore over 18 months to a single agency for "performance marketing" with thin documentation. Internal audit found the agency was a sole proprietorship registered to a relative of the marketing head's spouse.
Our approach: CFE-led forensic engagement. We executed: (a) full reconstruction of the agency's invoices against deliverables, finding that 68% of invoiced "campaigns" had no measurable digital footprint; (b) bank-statement analysis of the marketing head's family receipts cross-referenced against agency disbursements via UPI handles and IFSC matching; (c) interview of three subordinates establishing the procurement was bypassing the standard three-bid process; (d) preservation of email evidence under chain-of-custody for potential litigation.
Outcome: Quantified loss: ₹95 lakh. The marketing head was terminated for cause. The company recovered ₹47 lakh through settlement (avoiding a public criminal complaint). Internal procurement controls were redesigned. No regulatory escalation was required.
IBC Resolution — Mid-sized Manufacturing CIRP
Sector: Auto-component manufacturing, Pune. Year: 2024-25.
Background: ₹485-crore admitted-claim CIRP commenced after a Section 7 application by a consortium of three banks. The corporate debtor had two functional plants, ~340 employees, and a viable order book — but legacy debt, related-party diversions, and currency-loss recognition issues had caused liquidity collapse.
Our role: Acted as Resolution Professional alongside an experienced Insolvency Professional. Our team handled: (a) claims verification including 47 disputed operational-creditor claims; (b) appointment and oversight of two IBBI Valuers each for L&B, P&M, and S&FA — average liquidation value ₹165 crore vs fair value ₹298 crore; (c) Section 29A eligibility screening of 6 PRAs (rejecting one for preferential transaction history); (d) issued IM and managed three rounds of revised Plans; (e) presented to CoC with detailed comparative on operational risk of each Plan.
Outcome: Resolution Plan approved by CoC at 89% vote and confirmed by NCLT. Realisation: ₹254 crore (52% of admitted claims) — significantly above liquidation value. Both plants continued operations; ~310 employees retained; existing order book honoured. Full CIRP completed within 287 days including litigation.
Cross-Border M&A — Inbound Acquisition Structure
Sector: Speciality chemicals manufacturer, Gujarat. Year: 2025.
Background: A Japanese strategic acquirer wanted to acquire 100% of an Indian family-owned speciality chemicals company. Founders wanted maximum after-tax cash, with continued employment of two next-generation family members in operating roles. Headline enterprise value: ~₹620 crore.
Our approach: Sell-side advisory. Structuring analysis covered: (a) share sale vs slump sale comparison — share sale optimal due to long-term holding (LTCG at 12.5%) and continuity of regulatory licences; (b) two-step structure — first, demerger of family's personal real-estate assets into a separate entity (tax-neutral under Section 2(19AA)); second, share sale to Japanese buyer. (c) IBBI-Valuer FMV report supporting the FEMA pricing for the inbound non-resident acquisition; (d) CCI Form II filing with detailed market analysis showing no horizontal overlap; (e) negotiated SPA with locked-box mechanic, 20% escrow for 24 months, and standard reps & warranties package.
Outcome: Transaction closed within 7 months from term sheet. Effective tax leakage: ~14.2% on gross proceeds (compared to 24-28% under alternative structures). CCI approval in Phase 1 (35 days). Two next-generation family members continued in CXO roles per the SPA's employment-continuity covenant.
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