TaxTMI 
TaxTMI 
2017 (11) TMI 458
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....ng the appellant's claim for long-term capital gain being worked out at Rs. 1,96,10,755/-as rightly declared by it and enhancing the same to Rs. 2,35,60,000/-illegally by wrongly treating the building as depreciable assets and by denying the adjustment of cost of acquisition by Cost Inflation Index as statutorily required and thereby erred in passing the impugned illegal orders to create illegal demands of tax, interest and penalty against the appellant. 2. The authorities below have erred in resorting to making wrong computation of the amount of capital gain and thereby enhancing the tax Paid/payable by the appellant and the impugned orders cannot be upheld, in view of no depreciation having been claimed or allowed on the asse....
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....l gains of Rs. 1,96,10,755/- computed in the following manner:- Income from Capital gain (Chapter IV E) 1,96,10,755 Long Term Capital Gain Building 15.07.2010 Consideration Sales 2,70,00,000 Less: Indexed Cost Building 73.89.245 F.Y. 1997-98 - 34,40,000/331*711 Rs. 73,89,246 1,96,10,755 The Assessing Officer on the basis of the balance sheet relating to the preceding year i.e. 31.03.2010, noted that it does not reflect any immovable property. It was found that in the scheme of demerger under the Income Tax Act and Scheme u/s. 391 to 394 of the Companies Act between M/s. Super Leasing Ltd. and the assessee company as the resulting company and former is the transferor company. As per this scheme of demerger w....
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....he building and computed the capital gain by deduction of actual cost of Rs. 34,40,000/- out of the sale consideration. The assessee went in appeal before the CIT(A), who confirmed the order of the Assessing Officer determining the Short term capital gain at Rs. 2,35,60,000/- 4. We have heard the rival submissions and carefully considered the same along with the orders of the tax authorities below. We noted that as per the scheme of arrangement u/s. 391 to 394 of the Companies Act to transfer investment and property management business of Super Leasing Ltd. on a going concern basis to the assessee became effective on 19.02.2011 on getting requisite approvals and completion of necessary formalities. The Hon'ble High Court approved the sai....
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....imed any depreciation. Depreciation has been claimed only for the purpose of the Companies Act and not for the purpose of computing income under the Income tax Act. The provisions of section 170 is explicitly clear that the assessee has to be assessed in respect of the income of the predecessor therefore, the assessment of the income shall be made on the assessee as successor in the same manner as it would have been made on the predecessor and all the provisions of this act shall so far may apply on the assessee in respect of that income as would have been applied on the predecessor. 5. We have also gone through the provisions of section 50 of the I T Act. As per the said provision, if the assessee has sold its asset in respect of which ....
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.... tax Act, the gain so arising shall be assessed under the head Long term capital gain. 6. Now the next question arising in this appeal is in case of the gain so arising as to be assessed under the head Long term capital gain, whether the assessee shall be eligible for cost of indexation as per the provisions of section 48 of the Income tax Act or not. We noted that in this case, the assessee is liable for considering the said income in its income tax return in view of the provisions of section 170 of the Income tax Act. The provisions of section 170(2) stipulates as under: 170. (2) Notwithstanding anything contained in sub- section (1), when the predecessor cannot be found, the assessment of the income of the previous year in wh....