TaxTMI 
TaxTMI 
TaxTMI 
2021 (9) TMI 803
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....65,84,722/-. Thereafter, case of the assessee was selected for scrutiny assessment by issuing of notice under section 148 of the Act on 29.3.2017. From the details submitted by the assessee, the ld.AO observed that the assessee has shown total value of the machinery and plant used for its activity at Rs. 766.64 lakhs, of which Rs. 711.23 lakhs was of old plant & machinery belonged to erstwhile concern i.e. Shanti Processor Ltd. installed prior to 01.04.2005. In other words, according to the AO, the plant set up by the assessee was not new power plant, but it was set up by transfer of old and previously used machinery, value of which was more than 90% of the total value of plant. Therefore, claim of the assessee under section 80IA was not allowable. It was explained by the assessee that the erstwhile company, M/s.Shanti Processor Ltd. was amalgamated with the assessee-company, and the assessee has taken over entire new plant & machinery purchased by it; that the amalgamating company was eligible to claim deduction under section 80IA as it complied with all the requisite conditions; that the amalgamating company has not claimed deduction under section 80IA of the Act, and therefore, ....
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....levant part of the CIT(A)'s order reads as under: "3.3. I have carefully considered the Assessment Order and submission filed by the Appellant. The assessee company is an amalgamated company wherein Shanti Processor Ltd was merged with the assessee company w.e.f 01/04/2005 as per the order of Hon'ble High Court of Gujarat dated 31/03/2006. The power plant was installed in Shanti Processors Ltd. The Assessing Officer has disallowed the claim of appellant appellant had fulfilled all the conditions. As stated above, the plant & machinery valuing Rs. 7,11,23,416/- were installed in the factory of erstwhile Shanti Processor Ltd. which was transferred to Chiripal Industries Ltd. on amalgamation by the order of Gujarat High Court. The power plant was originally installed, by the erstwhile owner during financial year 2005-06. The original cost of the said plant which included coal handling system, boilers, steam turbine and electrical fittings was of Rs. 7,11,23,416/-. This value represents the cost to the previous owner mainly incurred during F.Y.2004-05 the installation of which was during F. Y. 2005-06. As per the provisions of section 80IA(12) when any undertaking of an Indian Co....
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.... this manner then in all the amalgamation cases benefit will not be available to resultant company as there is a transfer of machinery in all the cases. Further,. a machinery does not become old on transfer vide order of high court as the existing company gets merged with the new company and the existence of the existing company is no more. The A.O. has not brought on record evidence to substantiate his argument by showing that particulars machinery was purchased by Shanti processor Ltd which was already used. Therefore, new machinery purchased by Shanti Processors Ltd cannot be termed as old machinery since due to scheme of amalgamation; appellant is legally entitled to claim deduction. Therefore, on amalgamation, the appellant became entitled to all the benefits which were available to the amalgamating company namely Shanti Processors Ltd. It is also noted that similar claim was made by the appellant in the assessment year 2009-10, which was first year of its claim and the same 'was allowed meaning thereby the A.O. was satisfied that the appellant had fulfilled all the conditions. There is no change in facts and therefore, it is not proper to again revisit the eligibility o....
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....revious year relevant to A.Y. 2006-07 and started claiming deduction u/s. 80IA(4) of the Act from assessment year 2009-10, which was first year of its claimed and the same was allowed meaning thereby the A.O. was satisfied that the assesseet had fulfilled all the conditions. It is also noticed that the assessee has explained its entitlement for the impugned claim of deduction under section 80IA(12) as under:- "The power plant, in question, was transferred to assessee company under the scheme of Amalgamation of two companies viz Shanti Processors Ltd & Chiripal Petro chemicals Ltd. M/s Shanti Processors Ltd. was amalgamating company & Chiripal Petro Chemicals Ltd. was amalgamated Company under the provisions of the Companies Act, 1956. The scheme of Amalgamation was approved by Hon'ble High Court of Gujarat, vide its order dated 31/03/2006 w.e.f. 01/04/2005. It is also added that name of the company Chiripal Petro Chemicals Ltd. was changed to Chiripal Industries Ltd. as per approval of Registrar of Companies of Gujarat (A copy of both the orders are enclosed herewith for your honour's kind perusal and record purpose.) At this point, the assessee company would like to subm....
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.... (g) Treatment of Bad debts section 36(1)(vii): (h) Deduction available u/s 80IA & 80IB: (i) Carry forward and set off Business Losses & unabsorbed depreciation of the amalgamating company." We observe the assessing officer has not disproved these material facts and disallowed the claim of deduction on presumption basis without considering the relevant legal provision as elaborated in the findings of the Ld.CIT(A). The relevant legal provision has already been elaborated by the Ld. CIT(A) in his findings that as per the provisions of section 80IA(12) when any undertaking of an Indian Company which is entitled to deduction under this section is transferred before the expiry of the period specified in this section to another Indian Company then as per clause (b) the provision of this section shall apply to the amalgamated Company as they would have applied to the amalgamating Company if the amalgamation had not taken place and the provisions of sub- section (12) would only apply if the amalgamating Company was eligible for claiming deduction u/s 80IA. It is demonstrated from the above facts and circumstances that the assessing officer has disallowed the claim of the assessee on....