TaxTMI 
TaxTMI 
2010 (1) TMI 123
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....feiture of an amount of Rs.59,50,000/- towards 10 lakh preferential convertible warrants @ 5.95 per warrant. The said warrants were subsequently split-up into convertible warrants of Rs.1/- each with Rs.0.595 as paid up amount in respect of each warrant. The balance amount was to be paid by 8th October, 2001. 2. The assessee had subscribed to these warrants issued by M/s BLB Limited. The assessee after making the initial payment could not make the balance payment and, therefore, M/s BLB Limited forfeited the amount of Rs.59,50,000/- earlier paid by the assessee. The assessee claimed this loss as short-term capital loss under the head "capital gain". It was submitted on behalf of the assessee that the company had debited the loss to its c....
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....ny basis whatsoever to justify the same and that the addition made by him on this issue and that too on protective basis was not sustainable. Accordingly, the Tribunal upheld the order of the Commissioner of Income Tax (Appeals) while deleting the addition made by the Assessing Officer although on different grounds. 5. The main issue sought to be raised by the learned counsel for the Revenue is that the forfeiture of the convertible warrants did not amount to transfer of assets. The learned counsel referred to Section 45 of the Income Tax Act, 1961 (hereinafter referred to as "the said Act"). The beginning words of which are as follows:- "Any profits or gains arising from the transfer of a capital asset....." 6. The learned c....
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....his aspect of the matter. 8. Mr. Salil Aggarwal appearing on behalf of the respondent/assessee raised two points as to why this appeal should not be admitted. The first point raised by him was that the question whether the forfeiture in the present case amounted to transfer or not, was not raised before any of the authorities below and, therefore, the same cannot be taken for the first time before this Court. For this proposition he placed reliance on the decision of this Court in the case of Commissioner of Income Tax vs. Indocount Finance Limited: 271 ITR 215. 9. The second point urged by Mr. Aggarwal was that the decision in Vania Silk Mills (supra) has been over-ruled by the Supreme Court in a Larger Bench decision in the case of ....
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....s to the shares were extinguished and, therefore, this amounted to short term capital loss. The Karnataka High Court also placed reliance on the decision of the Supreme Court in the case of Grace Collis (supra). 11. In the rejoinder, Ms Bansal, who appears on behalf of the Revenue placed reliance on the decision of the Bombay High Court Commissioner of Income Tax vs. Sterling Investment Corporation Limited (Bom.): 123 ITR 441. 12. We have considered the arguments and have gone through the impugned order and papers on record and we are in agreement with the learned counsel for the respondent/assessee that the present appeal does not deserve admission as no substantial question of law arises for our consideration. This is so on two grou....