https://www.taxtmi.com/caselaws?id=8872 Transfer of business assets to a private limited company for a stated money consideration was treated as a sale for tax purposes, even though the consideration was later satisfied by allotment of shares to the transferor and his relations. The court treated the arrangement as two distinct steps: a sale of the assets for price and a separate mode of discharging that price. Because the company was a separate legal entity, the taxing authority had to give effect to the legal character of the document and not reclassify the transaction as a mere exchange. The excess over written down value was therefore taxable as profit under the second proviso to section 10(2)(vii). en-us Fri, 08 Jun 1973 00:00:00 +0530 Tue, 16 Jun 2009 19:14:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=8872 Transfer of business assets to a private limited company for a stated money consideration was treated as a sale for tax purposes, even though the consideration was later satisfied by allotment of shares to the transferor and his relations. The court treated the arrangement as two distinct steps: a sale of the assets for price and a separate mode of discharging that price. Because the company was a separate legal entity, the taxing authority had to give effect to the legal character of the document and not reclassify the transaction as a mere exchange. The excess over written down value was therefore taxable as profit under the second proviso to section 10(2)(vii). Case-Laws Income Tax Fri, 08 Jun 1973 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=8872