The ACIT, 3(1), Bhopal V. M/s Siel Financial Services Ltd., Delhi

ITA 24/IND/2011

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 66710 (ITAT-INDORE)
• Duration Of Justice: 1 year(s) 6 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-10-2012
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: Not Allotted
• Next Hearing Date: 27-10-2011
• Assessment Year: 1999-2000
• Appeal Filed On: 18-04-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R A VERMA
• Keywords: Sale consideration of property below Jantri Value; Depreciation; Fair market value; Scheme of amalgamation; Revised return; Unabsorbed depreciation
• Section: 50C; 139(5)

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH, INDORE BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER AND SHRI R.C. SHARMA, ACCOUNTANT MEMBER ITA NO.24/IND/2011 A.Y. 1999-2000 ASSTT. COMMISSIONER OF INCOME TAX 3(1), BHOPAL :: APPELLANT VS M/S SIEL FINANCIAL SERVICES NEW DELHI PAN AACCS-0398C :: RESPONDENT APPELLANT BY SHRI R.A. VERMA RESPONDENT BY SHRI HITESH CHIMNANI DATE OF HEARING 22.03.2012 DATE OF PRONOUNCEMENT 22.03.2012 O R D E R PER JOGINDER SINGH , JUDICIAL MEMBER THIS IS AN APPEAL BY THE REVENUE AGAINST THE ORDER DATED 12.12.2010 OF THE COMMISSIONER OF INCOME TAX (APPEA LS) FOR THE ASSESSMENT YEAR 1999-2000. THE FIRST GROUND RAISED IS THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LEARNED FIRST APPELLATE AUTHORITY ERRED IN HOLDING THAT THE ASSES SEE COMPANY IS ENTITLED TO CARRY FORWARD AND SET OFF OF BUSINESS L OSS AND UNABSORBED DEPRECIATION RELATING TO EARLIER ASSESSM ENT YEARS, AS 2 CLAIMED, EVEN THOUGH THE SOLE IDEA OF AMALGAMATION WAS NOT THE REVIVAL OF THE AMALGAMATING COMPANY BUT WAS ONLY TO TAKE THE BENEFIT OF CARRY FORWARD LOSSES. AT THE OUTSET, TH E LEARNED COUNSEL FOR THE ASSESSEE POINTED OUT THAT THE IMPUGNED ISSU E IS COVERED BY THE ORDER OF THE TRIBUNAL DATED 1.6.2012 IN THE CASE OF THE ASSESSEE ITSELF FOR THE A.YS. 1997-98 AND 1998-99 V IDE ORDER IN ITA NO. 17 & 18/IND/2011 FOR WHICH OUR ATTENTION WA S INVITED TO PAGES 1TO 8 OF THE PAPER BOOK. THIS FACTUAL MATRIX WAS NOT CONTROVERTED BY THE REVENUE. 2. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PER USED THE MATERIAL AVAILABLE ON RECORD. BEFORE COMING TO ANY CONCLUSION, WE ARE REPRODUCING HEREUNDER THE RELEVANT PORTION OF T HE AFORESAID ORDER DATED 1.6.2012 :- BOTH THESE APPEALS ARE BY THE REVENUE AGAINST DIFF ERENT IMPUGNED ORDERS DATED 3.11.2010 PASSED BY THE LEARN ED FIRST APPELLATE AUTHORITY ON THE COMMON GROUND THAT THE C IT(A) ERRED IN HOLDING THAT THE ASSESSEE COMPANY IS ENTITLED T O CARRY FORWARD AND SET OFF OF BUSINESS LOSS/UNABSORBED DEP RECIATION RELATING TO EARLIER ASSESSMENT YEARS, AS CLAIMED, E VEN THOUGH THE SOLE IDEA OF AMALGAMATION WAS NOT THE REVIVAL OF THE AMALGAMATING COMPANY BUT WAS ONLY TO TAKE THE BENEF IT OF CARRY FORWARD LOSSES. 2. DURING HEARING OF THIS APPEAL, WE HAVE HEARD SHR I DARSHAN SINGH, LEARNED CIT/DR AND SHRI HITESH CHIMN ANI, LD. COUNSEL FOR THE ASSESSEE. AT THE OUTSET, THE LD. CO UNSEL FOR THE ASSESSEE CLAIMED THAT THE IMPUGNED ISSUE IS COVERED BY THE DECISION OF THE TRIBUNAL IN THE CASE OF THE ASSESSE E ITSELF VIDE 3 ORDER IN ITA NO. 35/IND/2005 DATED 18 TH NOVEMBER, 2009. THIS FACTUAL MATRIX WAS NOT CONTROVERTED BY THE REVENUE. 3. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PER USED THE MATERIAL AVAILABLE ON THE RECORD. IN VIEW OF TH E ABOVE ASSERTION, WE ARE REPRODUCING HEREUNDER THE RELEVAN T PORTION FROM THE AFORESAID ORDER OF THE TRIBUNAL DATED 18 TH NOVEMBER, 2009 :- 3. IN THIS APPEAL, IN GROUND NO. 1, THE REVENUE IS AGGRIEVED BY THE DECISION OF LD. CIT(A) DIRECTING T HE A.O. TO ALLOW THE CARRY FORWARD OF THE LOSS OF RS. 2,83,85,937/- DISALLOWED BY THE ASSESSING OFFICER WHILE FRAMING THE ASSESSMENT. 4. THE FACTS, IN BRIEF, ARE THAT THE RETURNED INCOM E WAS SHOWN NIL BY THE ASSESSEE COMPANY AFTER SETTING OFF BROUGHT FORWARD LOSSES TO THE TUNE OF RS. 2,83,85,9 37/- . THE A.O. REQUIRED THE ASSESSEE TO EXPLAIN REGARD ING THE ELIGIBILITY OF SUCH SET OFF. THE ASSESSEE SUB MITTED THAT THE QUANTUM OF CARRY FORWARD LOSS AND UNABSORBED DEPRECIATION WAS SUBJECT TO PENDING ASSESSMENT/APPEALS FOR EARLIER YEARS. IT WAS ALSO SUBMITTED THAT THE COMPANY WAS LIABLE TO PAY TAX ON BOOK PROFIT U/S 115JA. THE ASSESSEE ALSO SUBMITTE D THE DETAILS OF ASSESSMENT OF EARLIER YEARS WHICH IN THE OPINION OF A.O. REVEALED THAT IN THE EARLIER YEARS OF UNABSORBED LOSSES./DEP0RECIATION HAD BEEN SET OFF U P TO ASSESSMENT YEAR 1999-2000. HENCE, THE COMPANY WAS NOT ELIGIBLE FOR SET OFF OF BROUGHT BUSINESS LO SS. THE ASSESSEE SUBMITTED THAT THERE WERE TWO COMPANIES, NAMELY, SHRI RAM AGRO TECH PRIVATE LIMITED COMPANY AND SIEL FINANCIAL SERVICES LIMITE D, M/S SIEL FINANCIAL SERVICES LIMITED WAS MERGED WIT H M/S SHRI RAM AGRO TECH INDUSTRIES LIMITED WITH EFFE CT FROM 1.4.1996 I.E. RELEVANT TO ASSESSMENT YEAR 1997 - 98. SUBSEQUENTLY, THE NAME OF SHRI RAM AGRO TECH INDUSTRIES LIMITED WAS CHANGED TO SIEL FINANCIAL SERVICES LIMITED. IT WAS ALSO BROUGHT TO THE NOTIC E THAT THE ORDERS OF THE HONBLE HIGH COURTS OF DELHI AND MADHYA PRADESH APPROVING THE AMALGAMATION WERE RECEIVED SUBSEQUENT TO FILING OF RETURNS BY BOTH TH E COMPANIES SEPARATELY FOR ASSESSMENT YEAR 1997-98. HOWEVER, REVISED RETURN OF THE AMALGAMATED ENTITY 4 WAS FILED ON 28.11.1997 DECLARING A LOSS OF RS. 2,56,39,053/-, WHICH COMPRISED OF BUSINESS LOSS OF UNABSORBED DEPRECIATION. THE A.O. NOTED THAT IN THE REVISED RETURN, THREE WERE NO BROUGHT FORWARD BUSINESS LOSS OR UNABSORBED DEPRECIATION PERTAINING TO ERSTWHILE SIEL FINANCIAL SERVICES LIMITED AND UNABSORBED DEPRECIATION AND BUSINESS LOSS BROUGHT FORWARD TO THE TUNE OF RS. 8,03.98,393/- AND RS. 8,68,35,217/- PERTAINED TO M/S SHRI RAM AGRO TECH INDUSTRIES LIMITED. THE A.O. HELD THAT SUCH BUSINES S LOSS WAS NOT ELIGIBLE FOR CARRY FORWARD AND SET OFF IN SUBSEQUENT YEARS AS THE REVISED RETURN I.E. RETURN FOR MERGED ENTITY WAS FILED BEYOND THE STATUTORY LIMIT, HENCE, VIOLATION OF PROVISIONS OF SECTION 80 OF THE ACT. HE FURTHER HELD THAT BUSINESS ACTIVITIES AND PRODUC TION ACTIVITIES OF M/S SHRI RAM AGRO TECH INDUSTRIES LIMITED HAD BEEN CLOSED BEFORE AMALGAMATION AND THE AMALGAMATED ENTITY (THE ASSESSEE ) BASICALLY CARRI ED FORWARD THE LOSSES OF ERSTWHILE SHRI RAM AGRO TECH INDUSTRIES LIMITED MERELY FOR TAKING ADVANTAGE OF T HE SAME IN THE ASSESSMENT YEAR AFTER ITS DISPOSING OF THE FIXED ASSETS OF COMPANY AND HENCE IN A.Y. 1999-2000 IT HAD NO FURTHER EXISTENCE AND, THEREFORE, FOR THI S REASON, THE ASSESSEE WAS NOT ELIGIBLE FOR SET OFF LOSSES PERTAINING TO SHRI RAM AGRO TECH INDUSTRIES LIMITED SUFFERED BY THAT COMPANY IN ASSESSMENT YEAR 1993-94 TO 1997-98. AGGRIEVED BY THIS, THE ASSESS EE CARRIED THE MATTER INTO APPEAL BEFORE THE LD. CIT(A ) WHEREIN THE DETAILED SUBMISSIONS WERE MADE REGARDING THE STATUS OF BOTH THE COMPANIES INDEPENDENTLY AND AMALGAMATION THEREOF AND CHANGE OF NAME OF NEW COMPANY. THE ATTENTION OF THE LD. CIT(A) WAS ALSO DRAWN TO THE PROVISIONS OF SECTION 72 AS AMENDED WITH EFFECT FROM 1.4.2000 TO ARGUE THAT SINCE THAT DATE IT WAS NOT REQUIRED THAT THE SAME BUSINESS SHOULD CONTINUE FOR THE PURPOSE OF AVAILIN G SET OFF OF EARLIER YEARS LOSSES. THE LD. CIT(A) AF TER CONSIDERING THE SUBMISSIONS MADE BY THE ASSESSEE HELD THAT THE ASSESSEE WAS ELIGIBLE FOR CARRY FORW ARD AND SET OFF OF SUCH BROUGHT FORWARD LOSSES. 5 THE RELEVANT FINDINGS OF THE LD. CIT(A) ARE AS UNDE R :- I HAVE EXAMINED THE CONTENTIONS OF THE A.O. AS WELL AS THE AR AND ALSO THE EXPLANATION DURING THE APPELLATE STAGE. IT APPEARS THAT THERE HAS BEEN SOME CONFUSION REGARDING THE NAME OF THE COMPANY, LOSSES OF WHICH ARE AVAILABLE TO THE APPELLANT COMPANY FOR SET OFF. IN CASE THERE WERE LOSSES DULY ASSESSED FOR EARLIER YEARS AVAILABLE I N CASE OF SHRIRAM AGRO TECH INDUSTRIES LIMITED WHICH WAS THE COMPANY BEING ASSESSED WITH THE A.O. AT BHOPAL AND WHOSE NAME HAS BEEN CHANGED TO SIEL FINANCIAL SERVICES WITH EFFECT FROM 23.6.1998 THE APPELLANT WOULD BE ENTITLED TO SET OFF OF SUCH LOSSES UPTO THE ASSESSMENT YEAR 1996-97 ONLY FROM ASSESSMENT YEAR 1997-98 ONE ASSESSMENT ORDER WAS PASSED BY THE ASSESSING OFFICER WHICH WAS IN RESPECT OF THE COMPANY DELHI BASED COMPANY SUBSEQUENTLY MERGED. ACCORDINGLY, CONTENTION OF THE APPELLANT FOR SET OF F OF BROUGHT FORWARD LOSSES, AS PER ASSESSMENTS FOR THE COMPANY BASED AT BHOPAL, NAMELY, SHRIRAM AGRO TECH INDUSTRIES LIMITED IS CORRECT.THE ASSESSMENTS FOR THE AMALGAMATING AND AMALGAMATED COMPANIES WERE MADE SEPARATELY UP TO THE ASSESSMENT YEAR 1996-97. IT WOULD BE RELEVANT TO MENTION AT THIS JUNCTURE, THE CBDT CIRCULAR NO. 779 ON THE SUBJECT FINANCE ACT, 1999, EXPLANATORY NOTES ON THE PROVISIONS RELATING TO DIRECT TAXES QUOTED HEREUNDER :- (XXI) SECTION 72 OF THE INCOME-TAX ACT, 1961 RELATING TO CARRY FORWARD AND SET OFF OF BUSINESS LOSS HAS BEEN AMENDED DELETING THE PROVISO TO CLAUSE (I) OF SUB SECTION(1) WHICH STIPULATED THAT THE BUSINESS OR PROFESSION FOR WHICH THE LOSS WAS COMPUTED HAS TO BE CONTINUED IN ORDER TO AVAIL CARRY FORWARD AND SET OFF OF LOSS. WITH THIS OMISSION, BUSINESS LOSS CAN BE CARRIED FORWARD AND SET OFF EVEN IF THE ASSESSEE IS ENGAGED IN A DIFFERENT BUSINESS 6 5. AGGRIEVED BY THIS, THE REVENUE IS IN APPEAL BEFORE US. 6. THE LD. DEPARTMENTAL REPRESENTATIVE NARRATED THE FACTS AND PLACED STRONG RELIANCE ON THE ORDER OF THE A.O. 7. THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT THERE WAS NO DISPUTE ON FACTS. THEREAFTER, HE CONTENDED THAT THE ORDER OF AMALGAMATION WAS APPROVED BY THE CONCERNED HONBLE HIGH COURTS ON 5.12.1997 AND ONLY THEREAFTER A CONSOLIDATED RETURN WAS FILED FOR THE AMALGAMATED ENTITY AND ORIGINAL RETURNS OF BOTH THE ENTITIES PRIOR TO SUCH AMALGAMATION HAD BEEN FILED WITHIN THE DUE DATE I.E. 28.11.1997. HENCE, THERE WAS NO VIOLATION OF PROVISIONS OF SECTION 80, AS THE RETURN OF NEW ENTITY HAD TO BE RELATED BACK TO THEIR SEPARATE RETURNS. IT WAS ALSO CONTENDED THAT THE PROVISIONS OF SECTION 72A WERE NOT AT ALL ATTRACTED BECAUSE THE ASSESSEE HAD NOT CLAIMED ANY SET OFF OF UNABSORBED BROUGHT FORWARD LOSS OR UNABSORBED DEPRECIATION OF AMALGAMATING COMPANY I.E. SIEL FINANCIAL SERVICES LIMITED. HE FURTHER CONTENDED THAT AS PER THE AMENDED PROVISIONS OF SECTION 72, NOW THERE WAS NO REQUIREMENT OF SAME BUSINESS TO BE IN EXISTENCE TO CLAIM SET OFF OF SUCH CARRIED FORWARD LOSSES. 8. WE HAVE CONSIDERED THE SUBMISSIONS MADE BY BOTH THE SIDES, MATERIAL ON RECORD AND THE ORDERS OF THE AUTHORITIES BELOW. 9. IT IS NOTED THAT THE RETURN OF BOTH AMALGAMATING AND AMALGAMATED COMPANY HAVE BEEN FILED WITHIN THE TIME PERIOD SPECIFIED U/S 139(1). IT IS ALSO NOTED THAT CONSOLIDATED RETURN OF THE AMALGAMATED ENTITY HAS BEEN FILED FOR THE ASSESSMENT YEAR 1997-98, AFTER AMALGAMATION BEING APPROVED BY THE CONCERNED HONBLE HIGH COURTS. THUS, IN OUR OPINION, IN THESE CIRCUMSTANCES, THE ASSESSEE CANNOT BE EXPECTED 7 TO DO AN IMPOSSIBLE THING I.E. FILING OF RETURN OF AMALGAMATED ENTITY BEFORE IT IS COMING INTO LEGAL EXISTENCE AND, THEREFORE, SUCH RETURN SHOULD RELATE BACK TO THE ORIGINAL RETURNS FILED BY THESE COMPANIES INDIVIDUALLY. IT IS NOT IN DISPUTE THAT ORIGINAL RETURNS HAVE BEEN FILED WITHIN THE TIME SPECIFIED U/S 139(1). HENCE, WE HOLD THAT THERE IS NO DEFAULT OF PROVISIONS OF SECTION 80 AS HELD BY THE ASSESSING OFFICER. WE ALSO FIND THAT THE PROVISIONS OF SECTION 72A ARE NOT APPLICABLE AS SUCH BROUGHT FORWARD LOSSES PERTAIN TO AMALGAMATED COMPANY. IT IS NOTED THAT DUE TO AMENDMENT OF PROVISIONS OF SECTION 72, IN THE YEAR UNDER CONSIDERATION, THERE IS NO REQUIREMENT THAT SAME BUSINESS I.E. BUSINESS OPERATIONS OF M/S SHRI RAM AGRO TECH INDUSTRIES LIMITED SHOULD HAVE BEEN CONTINUED. IN VIEW OF THESE FACTS AND LEGAL POSITION AS NARRATED ABOVE, WE HOLD THAT THE ORDER OF THE LD. CIT(A) IS CORRECT IN LAW. ACCORDINGLY, WE DISMISS THIS GROUND OF THE REVENUE. 3.1 IF THE OBSERVATION MADE IN THE ASSESSMENT ORDER , CONCLUSION DRAWN IN THE IMPUGNED ORDER, ASSERTION MADE BY THE LEARNED RESPECTIVE COUNSEL AND THE CONCLUSION DRAWN IN THE AFORESAID ORDER, ARE KEPT IN JUXTAPOSITION AND ANALYSED, WE FIND THA T THERE IS CATEGORICAL FINDING, WHICH IS BASED UPON THE SUBMISSION OF THE ASSESSEE, THAT THE HONBLE JURISDICTIONAL HIGH COURT AND ALSO THE HON BLE DELHI HIGH COURT HAVE DULY APPROVED THE SCHEME OF AMALGAMATION . EVEN OTHERWISE, THE LEARNED CIT(A) HAS FOLLOWED THE AFOR ESAID DECISION OF THE TRIBUNAL DATED 18 TH NOVEMBER, 2009. THE HONBLE MADRAS HIGH COURT IN THE CASE OF PENTAMEDIA GRAPHICS LIMITED V. ITO; 43 DTR 256 HELD AS UNDER :- ONCE THE SCHEME OF AMALGAMATION HAD BEEN SANCTIONE D WITH EFFECT FROM A PARTICULAR DATE, IT IS BINDING O N EVERY ONE INCLUDING THE STATUTORY AUTHORITIES AND THE ONL Y COURSE OPEN TO THE REVENUE WOULD BE TO ACT AS PER THE SCHE ME SANCTIONED, THE TAX AUTHORITIES ARE BOUND TO TAKE N OTE OF THE STATE OF AFFAIRS OF THE APPLICANT AS ON THE EFF ECTIVE DATE I.E. IST JAN 2004 AND A REVISED RETURN FILED REFLEC TING THE SAME CANNOT BE IGNORED ON THE STRENGTH OF S. 139(5) . 8 IN VIEW OF THE ABOVE DECISION FROM HONBLE MADRAS H IGH COURT AND THE DECISION OF THE TRIBUNAL THAT TOO IN THE CASE OF THE ASSESSEE ITSELF, WE FIND NO INFIRMITY IN THE IMPUGNED ORDER. IT IS AFFIRMED. FINALLY, BOTH THESE APPEALS OF THE REVEN UE ARE DISMISSED. ORDER PRONOUNCED IN OPEN COURT IN THE P RESENCE OF LEARNED REPRESENTATIVES FROM BOTH THE SIDES AT T HE CONCLUSION OF THE HEARING ON 28.5.2012. IN THE ABSENCE OF CONTRARY FACTS OR DECISION BROUGH T TO OUR NOTICE BY THE REVENUE, WE FIND NO JUSTIFICATION TO INTERFERE WITH THE CONCLUSION DRAWN IN THE IMPUGNED ORDER MORE ESPECIALLY THE FINDING RECORDED IN THE IMPUGNED ORDER WAS NOT CONTROVERTED BY THE REVENUE AND THE TRIBUNAL HAS ALREADY TAKEN A PARTICULAR VIE W . 3. THE NEXT GROUND PERTAINS TO DELETING THE DISALLOWANCE OF RS. 1,03,298/- MADE ON ACCOUNT OF EXCESS DEPRECIATION CLAIMED BY THE ASSESSEE. THE LEARNED SENIOR DR DEFENDED THE IMPUGNED ORDER WHERE AS THE LEARNED COUNSEL FOR THE ASSESSEE SUPPORTED THE DECISION TAKEN IN THE IMPUGNED ORDER. 9 4. ON PERUSAL OF RECORD AND AFTER CONSIDERING THE R IVAL SUBMISSIONS, WE FIND THAT THE LEARNED ASSESSING OFF ICER MADE THE DISALLOWANCE ON ACCOUNT OF DEPRECIATION OF RS.1,03,298/- ON THE PLEA THAT PURSUANT TO RE-ALLOC ATION OF BLOCK OF ASSET FOR THE PURPOSES OF SHIFTING WDV IN RESPECT OF COMPUTERS OF RS. 4,13,194/- TO THE SEPAR ATE BLOCK, THE ASSESSEE HAS NOT REDUCED THE ABOVE AMOUN T AND CLAIMED DEPRECIATION THEREON AT THE RATE OF 25% WHICH IS IN EXCESS. THIS OBSERVATION OF THE ASSESSI NG OFFICER WAS ARGUED TO BE WRONG BY THE LEARNED COUNS EL FOR THE ASSESSEE. THE DEPRECIATION CHART WAS ALSO PROD UCED BEFORE THE ASSESSING OFFICER FOR THE A.Y. 1998-99. THE WDV OF RS.28,44,596/- REFERRED TO BY THE ASSESSING OFFICER IN RESPECT OF PLANT AND MACHINERY WAS THE W DV AFTER MAKING ADJUSTMENT OF SALE CONSIDERATION OF AS SET AND THE VALUE OF PLANT AND MACHINERY ALONG WITH THE COMPUTERS WAS APPEARING IN THE DEPRECIATION STATEME NT. IN VIEW OF THESE FACTS, WE ARE IN AGREEMENT WITH TH E CONCLUSION DRAWN IN THE IMPUGNED ORDER THAT THE 10 ASSESSEE COMPANY MADE CORRECT STATEMENT IN RESPECT OF WDV OF COMPUTERS AND LIKELY DEPRECIATION ON PLANT A ND MACHINERY, THEREFORE, THE STAND OF THE LEARNED CIT( A) IS AFFIRMED. 4. THE LAST GROUND PERTAINS TO HOLDING THAT THE ASSESSING OFFICER WAS NOT JUSTIFIED IN MAKING THE A DDITION OF UNRECORDED INCOME REPRESENTING MONEY RECEIVED ON SALE OF ASSETS BY WAY OF UNRECORDED UNDERHAND DEALI NG AND CONSEQUENT ALLOWING RELIEF OF RS.1,76,45,845/-. THE CRUX OF ARGUMENTS ON BEHALF OF THE REVENUE IS IN SU PPORT TO THE ASSESSMENT ORDER WHEREAS THE LEARNED COUNSEL FOR THE ASSESSEE DEFENDED THE IMPUGNED ORDER. 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. WE FIND T HAT THE LEARNED ASSESSING OFFICER MADE THE ADDITION IN RESPECT OF ALLEGED UNRECORDED INCOME, BEING UNDER-H AND DEALING TO THE TUNE OF RS.1,76,45,845/- ON ACCOUNT OF SALE CONSIDERATION FOR THE ASSETS FOR THE FACTORY B UILDING 11 SOLD TO AN INDEPENDENT QUOTED COMPANY M/S BHASKAR EXXOIL LIMITED. BEFORE COMING TO ANY CONCLUSION, W E ARE REPRODUCING HEREUNDER THE CONCLUSION DRAWN IN THE IMPUGNED ORDER :- I HAVE GONE THROUGH THE ASSESSMENT ORDER, SUBMISS ION MADE DURING THE COURSE OF APPELLATE PROCEEDINGS AND HEARD THE AR. I FIND FROM THE PERUSAL OF THE OBSERVATIONS OF THE A.O. MADE IN THE ASSESSMENT ORDER THAT SALE CONSIDERATION LEADIN G TO ADDITION OF RS. 1,76,45,845/- HAS BEEN ESTIMATED BY HIM. THE A.O. MAINLY CONTENDED THAT SALE VALUE WAS AT A LESSER VALUE THAN INDEXED COST, MARKET VALUE OR WDV AND TH AT NO REASONS/EVIDENCE TO JUSTIFY CORRECTNESS OF SALES CO NSIDERATION WERE FILED BY THE APPELLANT. THE CONTENTION OF THEA .O. THAT SATIL ENTERED INTO AN AGREEMENT FOR SALE OF ASSETS WHEN THE SCHEME OF AMALGAMATION WAS NEITHER IMPLEMENTED NOR IT WAS APPROVED BY THE HIGH COURT OF NEW DELHI OR MADHYA PRADESH IS NOT CORRECT. ON 25.1.97 THE HONBLE DEL HI HIGH COURT PASSED ITS ORDER IN PETITION FILED FOR AMALGA MATION OF SFSL WITH SATIL W.E.F. 1.4.96 WHEREAS THE AGREEMENT WAS EXECUTED BETWEEN SATIL & M/S BHASKAR EXSOIL LTD. ON 17.12.97. EVEN THE PETITION FOR AMALGAMATION HAD A LREADY BEEN FILED BEFORE THE HONBLE MP HIGH COURT ORDER T O WHICH WAS PENDING. THE SAID ORDER WAS SUBSEQUENTLY PASSED . I FIND THAT A.O. HAS MERELY LEVELLED ALLEGATIONS AGAI NST THE APPELLANT FOR RECEIVING MONEY BY WAY OF UNDERHAND D EALING IN RESPECT OF SALE AGREEMENT EXECUTED BETWEEN THE A PPELLANT AND M/S BHASKAR EXSOIL LTD. WITHOUT ANY EVIDENCE. T HE APPELLANT COMPANY HAD OBTAINED CERTIFICATE IN FORM NO. 34A IN CONNECTION WITH SALES OF ASETS WHICH HAD BEEN IS SUED BY THE A.O. AFTER GOING THROUGH THE SALE AGREEMENT AND DETAILS OF SALE OF ASSETS FILED BEFORE HIM. THE APPELLANT COMP ANY HAD SOLD THE ASSETS TO AN INDEPENDENT OUTSIDE PARTY WHI CH IS ALSO A PUBLIC LIMITED COMPANY. THUS, ALL STATUTORY REQUI REMENTS AS PER LAW HAS BEEN COMPLIED BY THE APPELLANT. WITH TH E OMISSION OF SECTION 52 OF THE INCOME TAX ACT W.E.F. 1.4.1988, 12 THE A.O. IS NOT EMPOWERED TO SUBSTITUTE THE VALUE A T WHICH THE ASSETS WERE TRANSFERRED WITH FAIR MARKET VALUE OR ANY OTHER ESTIMATED VALUE IN THE CASE OF THE APPELLANT FOR THE CURRENT ASSESSMENT YEAR. THE ONUS REST ON THE A.O. TO BRING ON RECORD POSITIVE EVIDENCE THAT THE APPELLANT RECE IVED ANY CONSIDERATION OVER AND ABOVE THE DECLARED CONSIDERA TION IN RELATION TO SALE OF ASSETS AS PER THE AGREEMENT DUL Y EXECUTED. PROVISIONS OF SECTION 50C ARE ALSO NOT APPLICABLE F OR THE CURRENT ASSESSMENT YEAR AS THEY WERE INSERTED W.E.F . 2003- 04. THERE WAS NO MATERIAL ON RECORD WHASOEVER WITH THEA.O. TO INDICATE THAT THE APPELLANT HAS RECEIVED ANYTHIN G MORE THAN THE DECLARED CONSIDERATION. THOUGH THE BOOK VA LUE OF THE ASSETS WAS MORE THAN THE SALE VALUE, IT WOULD NOT E NABLE THE A.O. TO IGNORE THE TRANSACTION DULY EXECUTED BETWEE N TWO INDEPENDENT PUBLIC LIMITED COMPANIES. IT IS ALSO N OT THE CASE OF THE A.O. THAT THE APPELLANT CONCEALED FACTS AND THAT RECEIVEDTHE DIFFERENCE OF THE SALE VALUE BY UNFAIR MEANS. THEREFORE, IN THE ABSENCE OF EVIDENCE THAT MORE SAL E CONSIDERATION THAN WHAT WAS STATED WAS RECEIVED BY THE APPELLANT, NO HIGHER PRICE ON ESTIMATION BASIS CAN BE TAKEN FOR MAKING ADDITION AS UNRECORDED INCOME. THE JUDI CIAL CITATIONS (SUPRA) RELIED UPON AND DISCUSSED ARE SUP PORTING THE APPELLANTS CONTENTIONS. ACCORDINGLY, I HOLD TH AT THEA.O. WAS NOT JUSTIFIED IN MAKING ADDITION OF UNRECORDED INCOME REPRESENTING MONEY RECEIVED ON SALE OF ASETS BY WAY OF UNDER HAND DEALING. THE APPELLANT GETS RELIEF OF RS . 1,76,45.845/-. THUS GROUND NO. 10 IS DECIDED IN FAV OUR OF THE APPELLANT. IN THE ABSENCE OF ANY UNCONTROVERTED FINDING OR BRI NGING ANY POSITIVE MATERIAL ON RECORD BY THE REVENUE IN SUPPORT OF ITS CLAIM, WE ARE OF THE VIEW THAT PRESU MPTION CANNOT TAKE THE SHAPE OF EVIDENCE HOWSOEVER STRONG IT MAY BE MORE SPECIFICALLY WHEN THE ASSESSEE SOLD THE ASSET TO AN INDEPENDENT OUTSIDE PARTY WHICH IS A PU BLIC 13 LIMITED COMPANY AFTER COMPLYING WITH THE STATUTORY REQUIREMENTS IN ACCORDANCE WITH LAW. NO EVIDENCE WA S BROUGHT ON RECORD THAT THE ASSESSEE RECEIVED ANY UNDERHAND CONSIDERATION OVER AND ABOVE THE DECLARED CONSIDERATION IN RELATION TO SALE OF ASSETS AS PER THE AGREEMENT WHICH WAS DULY EXECUTED. IN VIEW OF THES E FACTS, THERE IS NO JUSTIFICATION TO INTERFERE WITH THE CONCLUSION DRAWN IN THE IMPUGNED ORDER, THEREFORE, THIS GROUND OF THE REVENUE IS ALSO HAVING NO MERIT, CONSEQUENTLY, THIS GROUND IS ALSO DISMISSED. FINALLY, THE APPEAL OF THE REVENUE IS DISMISSED. THIS ORDER WAS PRONOUNCED IN OPEN COURT IN THE PRESENCE OF LEARNED REPRESENTATIVES OF BOTH THE SID E AT THE CONCLUSION OF HEARING ON 22 ND OCTOBER, 2012. THIS ORDER WAS PRONOUNCED IN THE OPEN COURT IN THE PRESENCE OF LD. REPRESENTATIVES FROM BOTH SIDES AT THE CONCLUSION OF THE HEARING ON 22.10.2012. 14 SD SD (R.C.SHARMA) (JOGINDER S INGH) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 22 ND OCTOBER, 2012 COPY TO: APPELLANT, RESPONDENT, CIT, CIT(A), DR, GU ARD FILE DN/-2222