TaxTMI 
TaxTMI 
2015 (4) TMI 972
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...., the Assessing Officer added back a sum of Rs. 38,69,919/- as short term capital gain. 3. The brief facts of the case are that the assessee had filed its return of income for the assessment year 2006-07 on 09.11.2006 declaring a total income of Rs. 33,75,330/-. The case was selected for scrutiny and the assessment was completed u/s.143(3) accepting the returned income. On perusal of records, it has been noticed in the computation statement that the assessee had claimed Long Term Capital Gains of Rs. 19,01,955/- after claiming 54EC deduction amounting to Rs. 65,00,000/- on the sale proceeds of Rs. 1 crore to M/s SRP Tools Ltd, which the assessee treated as ''Slump Sale'' u/s. 50B. Proceedings u/s.263 was initiated and the CIT-III vide or....
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....he assessee for ''Slump Sale'' and thereby adding back a sum of Rs. 38,69,919/- as Short Term Capital Gain thereby raising a demand of tax dues of Rs. 9,23,150/- relying upon the decision of Bombay High Court in the case of Anand Electric Co. Ltd vs. CIT 237 ITR 587. Aggrieved, the assessee preferred an appeal before the Commissioner of Income Tax (Appeals). On appeal, the Commissioner of Income Tax (Appeals) confirmed the order of the Assessing Officer. Against this, the assessee is in appeal before us. 4. The ld. Authorised Representative for the assessee submitted that entire assets were taken over by M/s. SRP tools as a whole. According, to him, only purchasing company valued the said assets and there is no evidence in the hands of t....
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....nce, the assessee company cannot be denied the benefit of slump sale just for the reason that the buyer of the slump sale transaction has accounted on individual basis. He submitted that the Assessing Officer relied upon the judgment in the case of Anand Electric Co. Ltd vs. Commissioner of Income Tax 237 ITR 587 (Bombay High Court). However, the facts and circumstances in the above mentioned case is completely different from the facts and circumstances of the present case as the former deals with the takeover of an entire business as a going concern and the sale consideration was arrived at by taking into consideration the value of the plant, machinery and dead stock as assessed by the valuer. Further, he relied upon the judgment of Kaloor....
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....he Institute of Chartered Accountants of India can be made where under para 15.3 it has been stated where several assets are purchased for a consolidated price, the consideration is apportioned to the various assets on a fair basis as determined by competent valuers, for the purpose of accounting in the books of the buyer. He also relied on the order of the Tribunal in the case of Coromandel Fertilisers Ltd vs. DCIT reported as 90 ITD 344 wherein it was held that : "When running units have been sold ''as is where is basis'' along with entire liabilities and manpower there was a slump sale and no capital gain exigible by application of section 50 of the Income tax Act". The Authorized Representative further relied upon the judgment in ....
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....h the provisions of section 10(2) (vii), proviso (ii), of the 1922 Act prior to amendment, the said circular had no application and that the matter was governed by the decision in B.M. Kharwar (1969) 72 ITR 603(SC). The view of the Tribunal was correct''. 5. On the other hand, the Departmental Representative submitted that the Assessing Officer during the course of assessment proceedings requested M/s. SRP Tools Limited to furnish the details relating to purchase of land, building, plant and machinery and other assets from the appellant company and the value of the above assets as appearing in their books of accounts. The purchaser has furnished the details. The Assessing Officer served a show cause notice on the assessee for treating th....
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....ax Act. However, the Assessing Officer collected information that the assessee has sold following assets by assigning respective value of the same as under:- List of Assets Amount in Rs. Land 51,122 Buildings - Factory 2,03,335 Buildings - Office 7,37,271 Furniture & Fittings 81,889 Machinery- Indigenous 88,50,980 Vehicles 7,639 Inspection Equipments 29,763 Electrical Equipments & Installations 34,939 Typewriters 3,062 Total 1,00,00,000 The above findings of the Assessing Officer also supported by the certificate issued by the Chartered Accountant in form 3CEA (Rule 6H) dated 02.11.2006 wherein it was mentioned in Column No.6(d) that value of liabilities relatabl....