TaxTMI 
TaxTMI 
2021 (8) TMI 55
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....t for the assessment year 2014-15 in the case of the assessee, M/s Roca Bathroom Products Pvt. Ltd., the A O noticed from the Profit and Loss Account that the assessee has claimed set off of accumulated unabsorbed losses of M/s. Espiern Plastics Limited to the extent of Rs. 7,04,94,282. From the Note 30 to the financial statement titled as 'Amalgamation of Espiem Plastics Limited with the company" , the A O noted that the consideration for 74% of the equity share capital of the transferee company held by ex-promoters was discharged on 12.02.2014 only. Since the assessee company was holding only 26% percent of equity shares as on 01.04.2013 which is the appointed dated as per the scheme approved by the Hon'ble High Court of Madras on 28.4.20....
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....appreciating the fact that 3. The CIT (A) in law and on facts in failing to appreciate that conditions stipulated under the provisions of section 2(1B) of the Act were satisfied upon amalgamation of Ws. Espiem Plastics Limited ('amalgamating company') with the Appellant. 4. The CIT (A) erred in considering the 'appointed date' instead of the date on which the scheme becoming effective ('effective date'), for concluding the noncompliance of conditions specified in section 2(1B)(iii) of the Act. 5. The CIT (A) erred in disregarding the scheme of amalgamation which inter-alia sanctioned the vesting of and carry forward of loss by Appellant which is binding on the statutory authorities including income-tax authorities. 6. The CIT (A....
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....or compliance of conditions specified in section 2 (1B)(iii) of the Act, the effective date be regarded. Per contra, the Ld. DR reiterating the facts brought by the lower authorities submitted that when the provisions of the Act are clear, there is no case for any ambiguity and hence the interpretation made by the lower authorities are in accordance with law and hence pleaded that the orders of the lower authorities be upheld. 4. We heard the rival submissions and gone through the relevant material. It is seen from the paperbook that Espiem Plastics Ltd., the transferor company, as well as Roca Bathroom Products Pvt. Ltd., the transferee company, sought the sanctioning the scheme of amalgamation before the Hon'ble High Court of Judicature ....
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.... to evade the tax by amalgamating companies and held that the requirement u/s. 2(1B) of the Act has not been met. From the material and explanation furnished before the AO etc., the Hon'ble tribunal found that the amalgamation reserves credited to the accounts of Rs. 64,69,73,480/- appeared in the audited accounts of the four companies till 31.03.2004 and 31.03.2005, respectively, and the balance amount is on account of inter se debit balance of the transfer company. The shares being held by the transferor companies between themselves, inter se, was more than 3/4th and therefore the provisions of section 2(1B) have not been violated. Thus, on the facts, this case law offers no help to the assessee. In this case, the scheme of amalgamation h....