TaxTMI 
TaxTMI 
2026 (9) TMI 1339
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....ed. 2. The department [the appellant] has filed the appeal under Section 260A of the Income Tax Act, 1961 [the Act] impugning the order dated 08.10.2025 passed by the Income Tax Appellate Tribunal, Bengaluru [the ITAT] in I.T.A.No.1023/Bang/2025 for the Assessment Year [AY] 2018-19. The department had filed the said appeal impugning the order dated 19.02.2025 passed by the Commissioner of Income Tax (Appeals)-15, Bengaluru [the CIT(A)] in CIT(A) No.11/BNG/10755/2017-18. The respondent [the Assessee] had filed the said appeal impugning the Assessment Order dated 30.03.2022 passed by the Assessing Officer [the AO] under Section 143(3) read with Section 153A of the Act. 3. In the given facts, the department has projected the following su....
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....43(1) of the Act on 17.05.2019. Subsequently, a search under Section 132 of the Act was conducted at the office premises of the Assessee on 17.12.2020. Pursuant to the said search, the AO issued notice under Section 153A of the Act on 28.09.2021, calling upon the Assessee to file its return of income. The Assessee filed its return on 29.10.2021, declaring nil income. However, the Assessee did not E-Verify the return of income. The AO, by order dated 30.03.2022 passed under Section 153A read with Section 143(3) of the Act, assessed the total income at Rs.14,99,89,081/-. 6. In the said proceedings, the AO disallowed the deduction claimed under Section 80-IA of the Act. The AO found that the Firm had been converted into a company by way suc....
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....ommitted any violation of the provisos to Section 47 (xiii) of the Act as alleged by the AO. We will go through the reasons stated by the AO for levying long term capital gains tax on the transfer of the firm's capital asset to the assessee as a result of succession of the firm by the company in the business carried on by the firm, when the assessee had not violated any of the conditions mentioned in the provisos to section 47(xiii) of the Act. The AO initially issued a show cause notice, proposing to add the long-term capital gains for the reason that the assessee had violated section 47(xiii) proviso (a) & (c) of the Act. Subsequently the assessee filed their detailed objections and demonstrated before the AO that none of the provisos....
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.... the assessee, we have gone through the proviso (a) to section 47(xiii) of the Act in which the words used are that "immediately before the succession", which means that the assets and liabilities of the firm immediately before the date of succession would become the assets and liabilities of the company. In this case, the succession was taken into effect from 27.03.2017 and therefore all the assets and liabilities of the firm stood immediately before the date of succession i.e. as on 26.03.2017 vests with the company. The meaning of the word immediately as given in the Black's Law Dictionary is as follows; "without interval of time, without delay, straight away". 10. It is apparent from the above that the learned ITAT has r....
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....partners of the Firm had received any consideration or benefit, directly or indirectly, in any form or manner other than by way of allotment of shares on the conversion to the Assessee company. It is not disputed that the partners were allotted shares in lieu of their shares in the Firm as held by them immediately preceding the succession. There was no embargo or restriction on the partners withdrawing any fund from the firm prior to its succession and any transaction done prior to succession does not render the succession as a transfer within the meaning of proviso (a) and (c) of Section 47(xiii) of the Act. 13. The learned ITAT's finding of fact that the assets and liabilities of the Firm as on 26.03.2017, immediately prior to its ....