TaxTMI 
TaxTMI 
2024 (11) TMI 1594
X X X X Extracts X X X X
X X X X Extracts X X X X
....under: 7. The NFAC, Delhi erred in sustaining the disallowance the claim of carry forward of business loss to the tune of Rs. 1,25,40,145/- in terms of Section 72A of the Act post amalgamation / merger with M/s Ucal Power System Ltd and consequently erred in adding it back in the computation of taxable total income in the computation of taxable total income without assigning proper reasons and justification. 8. The NFAC, Delhi failed to appreciate that claim of carry forward of business loss in terms of Section 72A of the Act post amalgamation / merger with M/s Ucal Power System Ltd was correct on various facets and ought to have appreciated that the arbitrary disallowance of such validly claimed deduction was wrong, erroneous, incorrect, invalid, unjustified and not sustainable both on facts and in law. 9. The NFAC, Delhi failed to appreciate that provisions of Section 72A(2) of the Act would mandate the eligible appellant / amalgamated company to continue the business of amalgamating company and did not mandate the particular product manufactured by amalgamating company to be manufactured by the amalgamated company and ought to have appreciated that the....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ppreciate that having not granted sufficient opportunity establishing the fact of defiance of the principles of natural justice, the violation of the said principles would make the order as nullity in law. 4. At the outset, the Ld.AR of the assessee drawing our attention to Ground No.16 submitted that these appeals have to be necessarily restored back to the file of the AO (Assessing Officer) for fresh assessment since there was violation of natural justice and assessee was not provided proper opportunity by the AO before framing the assessment order and cited the decision of the Hon'ble Supreme Court in the case of TIN Box Co. v. CIT reported in [2001] 249 ITR 216 (SC). 5. Further, the Ld.AR drew our attention to Ground Nos.7 to 15 and submitted that the assessee filed return of income on 27.11.2003 admitting an income of Rs. 1,14,84,108/- and later filed the revised return on 01.11.2004 admitting 'NIL' income. The AO noted that the reason for filing the revised return was due to the adjustment of loss carried forward in the case of M/s.Ucal Power Systems Ltd., (hereinafter in short 'M/s.UPSL'), which was declared as a sick company by BIFR and taken over by the assessee comp....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... availed by the assessee company u/s. 72A of the Act and rejected the grant of benefit u/s. 72A of the Act on the grounds mentioned in its said letter dated 03.02.2010. Pursuant to aforesaid developments, the AO reopened the assessments from the AYs 2003-04 to 2006-07 and accordingly, denied the carried forward losses and unabsorbed depreciation from amalgamated company M/s.UPSL pursuant to BIFR scheme (supra) and made an addition of Rs. 1,25,32,085/- and also made an addition of Rs. 4,11,40,145/- u/s. 41(1)(b) of the Act. Meanwhile, the assessee company approached the Hon'ble High Court against action of the AO for reopening the assessments vide W.P.No. 28924/10 and the Hon'ble Single Bench of the High Court granted interim Stay vide its order dated 24.01.2011. However, thereafter the assessee company withdrew its petition on 30.01.2014 [on the ground that it would pursue its relief by filing MA before BIFR keeping in view the Hon'ble Delhi High Court's order dated 13.07.2012 passed in WP(C) No.4163/2012 in the case of M/s.Orient Vegetax Pro. Ltd.]. And the Hon'ble High Court allowed assessee company's request to withdraw its petition. Accordingly, the assessee....
X X X X Extracts X X X X
X X X X Extracts X X X X
....krishnan, Learned Senior Standing Counsel, who takes notice on behalf of the Respondents. 2. After careful consideration of the submissions made before us and also taking note of the decision in the case of CIT-vs- Lakshmi Machine Works Ltd. reported in [2020] 121 taxmann.com 284 (Madras), we are of the view that question of law arises for consideration in this appeal, namely, as to the effect of an order passed by the Board of Industrial & Financial Reconstruction (BIFR), while approving a scheme of settlement. 3. The Appellant Assessee would refer to the scheme, which was sanctioned by the BIFR, in the case of 46 of 98 (II) dated 19.01.2004 specifically dealing with the claim of the Central Board of Direct Taxes/ Directorate of Income Tax in paragraph 8.3 of the scheme, wherein directions have been issued to the Income Tax Department to consider to grant exemption under Section 72-A(2) of the Income Tax Act, 1961 [hereinafter referred to as 'the Act'] to UDB to enable the Assessee to carry forward the accumulated business losses and unabsorbed depreciation; to OF CA consider to exempt the company from the provisions of Sections 41(1) and 43-B of the Act ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....TACL (UDB) to enable the assessee to carry forward accumulated business losses and unabsorbed depreciation of UPSL; to consider to exempt the company from the provisions of Sec.41(1) & Sec.43B of the Act, etc, which are the subject matter of grounds of appeal before this Tribunal. According to the Ld.AR, the final decision of the Hon'ble High Court (Division Bench) has a direct bearing on the assessment of the assessee [ refer additions made by AO in the reassessment order which is subject matter of appeal] and which issues are pending before the Hon'ble High Court as evident from the order of the Hon'ble High Court (cited supra) and contented that if the assessee succeeds in its appeal, then there would be no taxable income. Therefore, he prays that the matter may be restored back to the file of the AO, so that assessment can be made de novo after order is passed by the Hon'ble High Court in Writ Appeal No.2249 of 2021. Moreover, according to the Ld.AR, the assessee didn't get proper opportunity before the AO and cited the decision of the Hon'ble Supreme Court in the case of TIN Box Co. v. CIT reported in [2001] 249 ITR 216 (SC), he prayed that the assessment may be ordered to be ....