TaxTMI 
TaxTMI 
2022 (9) TMI 703
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.... 333/- as per Chartered Engineer's Report not controverted by AO. 3. Ld. CIT (A) erred in law and on facts in holding that appellant bought only land & building for Rs.6,77, 00, 000/- ignoring bifurcation of value of land and building as well plant & machinery. 4. Ld. CIT (A) erred in law and on facts in concluding that appellant could not have earned job work receipt of Rs. 88,53,718/- from a shut down factory not appreciating correct facts that unit was purchased as on going concern. 5. Ld. CIT (A) further erred in law and on facts in holding that plant & machinery were wrongly taken in the block of assets since never used. 6. Ld. CIT (A) erred in law and on facts making irrelevant observation that stamp duty paid@ 20% of purchase price being proportionately very high indicated that price paid for land & super structure as substantially low. 7. Ld. CIT (A) factually erred in holding retraction of survey statement as not tenable without appreciating that there was total compliance with survey statement & that appellant never retracted from the statement. 8. Ld. CIT (A) erred in law and on facts confirming view of AO not all....
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....n this regard giving basis for valuation also; * that plant & machinery was put to use during the year and job work generated therefrom which fact was reflected in the financial statement of the assessee, and therefore, it was incorrect for the Revenue to hold that the assessee had sold only scrap and not plant & machinery of any value. * He also pointed out that the entire basis with the Revenue rested on the statement of director of the assessee-company from which the inference of the Revenue that only scrap was acquired and sold by the assessee was not correct. In this regard, he referred to various documents in support of his above claim. 6. The contention of the ld.DR, on the other hand, was that director of the assessee company had categorically stated in statement recorded during survey conducted on the assessee that the assessee had only sold scrap and the fact of the acquisition of MIL in December, 2010 and sale of assets in short period of time, i.e. 15.2.2011 showed that these assets were obsolete and of no use to the assessee. 7. We have noted that the issue involves determination of fact, whether the assets which were acquired by the assessee on....
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....totality and be capable of advancing money to meet liability of permanent workers of the unit along other needs, and who could keep the unit running till the settlement of VRS scheme with the employees and workers. 10. He thereafter drew our attention to the deed of assignment of leasehold right and conveyance of super-structure and plant & machinery entered into between the assessee and MIL on 15-12- 2010 i.e. impugned year when the unit was acquired, and copy of which was placed before at PB Pg.No.48 to 112. Pointing out there from that it was specifically mentioned that MIL unit had installed various plant & machinery, both movable and immovable at point No.V (b) pg 57, point no.VII pg 59,point no.XI pg. 60 and the assessee having agreed to purchase unit including the plant & machinery both movable and immovable mentioned at page no.7 for a consideration of Rs.6.77 crores, and the MIL agreeing to sell to the purchaser the entire unit comprising of various movable and immovable plant & machineries as given at Point No.XI. His contention being that even as per the sale agreement there were immovable machineries which are part of the unit sold to the assessee for a consideration....
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.... that it included both scrap sale of Rs.84,11,164/- and machinery sale of Rs.1,62,45,000/- and also store sale of Rs.1,33,200/- and after including VAT/TCS thereon total sale came to Rs.2,60,56,122/-. He pointed out that invoices of the scrap sales were also placed before the Revenue authorities, and which were also placed at PB Page No.115 to 124 along with copy of ledger account of scrap sale and also invoices of machineries sold along with copy of ledger account of machinery sold during the year (placed before us PB Page No.125-137). 14. The ld.DR, on the other hand, drew our attention to the statement of the director of the assessee-company in support of his contention that he had admitted to selling only scrap. In this regard attention was drawn to Para-2 of page no.3 of the assessment order. Our attention was also drawn to the basis of the AO for arriving at his finding that machinery acquired by the assessee from MIL, all of obsolete and scrap and of no value which was mentioned at Page No.8 of the assessment order under the head "discussion on assessee's s submissions" as under: "I have carefully considered the submission of the assessee and find no merit in it ....
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.... of accounts as on date the value of the sale precede as already been included in Rs. 2.65Crores as mentioned in my reply to Question No. 15 same will be accounted during the current financial year. Q.No. 19 Please provide break up of sale of scrap aggregate to Rs. 2.65 Crores. A.No. 19 Exact break up of the various items of scrap along with copies of invoices will be submitted in your office within a weeks times. Q.No.20 On the basis of sale of scrap of Rs.2.65 crores mentioned at question No. 15 and after considering brought forward loses of Co. The tax payable works out to approximately to Rs.45 lacs. Please state by when the same will be paid to the government account. A.No.20 I will make arrangement for payment of tax of Rs.45 lacs before 31st March 2011 and shall submit the evidence of tax payment within a week time." 16. After considering the contentions of both the parties as above, we find that the basis with the Revenue for holding that the machinery acquired by the assessee on acquisition of the business of MIL was only scrap with nil value ,thus denying benefit of setting off cost of acquisition against sale consideration received ....