The Income Tax Officer, Amritsar. V. M/s Bhagat Industrial Corporation Ltd., Amritsar.

ITA 408/ASR/2016

• Counselvise Citation: [2021] 107 COUNSELVISE.COM (IT) 5121 (ITAT-AMRITSAR)
• Duration Of Justice: 5 year(s) 1 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-09-2021
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2007-2008
• Appeal Filed On: 03-08-2016
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: V WADHWA
• Keywords: Capital asset; Principle of natural justice; Corroborative evidences; Set aside; Capital Gains
• Section: 150(1); 13; 22

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNA L AMRITSAR BENCH, AMRITSAR. BEFORE SH. LALIET KUMAR, JUDICIAL MEMBER AND DR. M. L. MEENA, ACCOUNTANT MEMBER I.T.A. NO. 408/ASR/2016 AS SESSMENT YEAR: 2007-08 INCOME TAX OFFICER, WARD- 5(1), AMRITSAR. (APPELLANT) VS. M/S BHAGAT INDUSTRIAL CORPORATION LTD., V.P.O. KHASA, AMRITSAR [PAN: AAACB 7368P] (RESPENDENT) C.O. NO. 21/ASR/2016 (IN I .T.A. NO. 408/ASR/2016) ASSE SSMENT YEAR: 2007-08 M/S BHAGAT INDUSTRIAL CORPORATION LTD., V.P.O. KHASA, AMRITSAR [PAN: AAACB 7368P] (APPELLANT) VS. INCOME TAX OFFICER, WARD- 5(1), AMRITSAR. (RESPENDENT) APPELLANT BY SH. SANJAY DHARIWAL, CIT-DR RESPONDENT BY SH. V. WADHWA, C.A. DATE OF HEARING 20.09.2021 DATE OF PRONOUNCEMENT 20.09.2021 I.T.A. NO. 408/ASR/2016 & C.O. NO. 21/ASR/2016 2 ORDER PER BENCH:- THE PRESENT APPEAL FILED BY THE REVENUE AND C.O. FI LED BY THE ASSESSEE FEELING AGGRIEVED BY ORDER OF LD. CIT(A)-2 , AMRITSAR, ON THE GROUND MENTIONED IN THE MEMO OF APPEAL AND IN CROSS OBJECTION FILED BY THE ASSESSEE. 2. AT THE OUTSET LD. CIT-DR HAD DRAWN OUR ATTENTIO N TO PAGE 14 OF THE CIT(A) ORDER WHEREIN THE CIT(A) HAS OBSERVED THAT A SSESSING OFFICER HAD FAILED TO CONSIDER THE SCHEME OF MERGER, WHICH THE HONBLE HIGH COURT SUBSEQUENTLY APPROVED. THE LD. DR HAD ALSO FILED TH E DETAILED WRITTEN SUBMISSION IN SUPPORT OF THE CASE OF THE ASSESSING OFFICER BEFORE US. IT WAS THE CONTENTION OF DR THE ORDER OF CIT(A) SUFFERED F ROM PERVERSITY AND NON- APPLICATION OF MIND AND PREMISED ON THE DOCUMENT, W HICH WAS NEITHER FILLED BEFORE THE ASSESSING OFFICER IN THE ASSESSMENT YEAR UNDER CONSIDERATION NOR BEFORE THE LD. CIT(A) AND THEREFORE THE ENTIRE ORDER PASSED BY THE CIT(A) IS REQUIRED TO SET ASIDE, AND THE ORDER PASS ED BY THE ASSESSING I.T.A. NO. 408/ASR/2016 & C.O. NO. 21/ASR/2016 3 OFFICER MUST BE RESTORED. IN THE WRITTEN SUBMISSION S FILED BY THE LD. DR IT WAS MENTIONED AS UNDER:- 1. ASSESSMENT ORDER U/S 143(3)/147 WAS PASSED IN THIS CASE ON 31.03.2015. THE SAID ORDER WAS CHALLENGED BY THE ASSESSEE BEFORE THE CIT(A) AND TH E LD. CIT(A) VIDE ORDER DATED 29.04.16 ALLOWED THE APPEAL OF THE ASSESSEE. AGGRIEVED WITH THE ORDER OF THE LD. CIT(A), THE REVENUE FILED APPEAL BEFORE THE HONBLE TRIBUNAL AND THE ASSESSEE HAS FILED CROSS-OBJECTIONS. THE APPEALS WERE PART HEARD ON 16.09.2021 BY THE HONBLE BENCH AND THE UNDERSIGNED HAS BEEN DIRECTED TO APPEAR ON 20.09.21, I.E., THE NEXT DATE OF HEARING. MEANWHILE AS PER THE REQUEST OF THE UNDERSIGNED, THE ASSESSEE HAS MAILED THE SCHEME WHI CH HAS BEEN APPROVED BY THE HONBLE HIGH COURT VIDE ORDER DATED 17.12.2007. 2. GROUNDS OF APPEAL BY REVENUE ARE ENCLOSED AS ANNEXU RE-1 HEREWITH. IT IS TO BE NOTED THAT ADDITION OF RS. 11, 90,00,000 WAS MADE BY THE A.O. ON ACCOUNT OF MONEY RECEIVED FROM TWO COMPANIES, I.E., BAGGA MILLENNIUM PVT LTD ( RS. 8,3 6,00,000) AND GURSIMRAN MILLENNIUM LIQUOR (INDIA) PVT LTD. THE ASSESSEE SUBMITTED TWO MOUS DU RING THE COURSE OF ASSESSMENT REGARDING SALE OF ITS DISTILLERY UNIT KHASA DISTILLERIES TO B MPL AND DID NOT PROVIDE THE FULL AND CORRECT INFORMATION REGARDING SALE/DEMERGER OF ITS DISTILLE RY UNIT TO BMPL OR ANY OF ITS SUBSIDIARIES. THE ASSESSEE PROVIDED INFORMATION IN A PIECEMEAL MANNER TO AVOID ANY INQUIRY BY THE A.O. WHICH IS CLEAR FROM PARA 4.6, 4.7 AND 4.8 OF THE ASSESSMENT ORDER. AS THE ASSESSEE COULD NOT EXPLAIN THE REASONS OF RECEIPT OF MONEY FROM THE ABOVE ENTITIES AND NEXUS OF MONEY WITH BUSINESS RESTRUCTURING, THEREFORE, THE A.O. HAD ADDED THE MO NEY RECEIVED BY THE ASSESSEE IN THE YEAR UNDER CONSIDERATION. 3. AGGRIEVED BY THE ORDER OF THE A.O., THE ASSESSEE FI LED APPEAL BEFORE THE CIT(A) AND HE ALLOWED THE APPEAL OF THE ASSESSEE. THE ORDER OF LD. CIT(A) DATED 29.04.2016 SUFFERS FROM MANY PERVERSITIES, WHICH ARE HIGHLIGHTED AS UNDER- (A) ON PAGE-14 OF THE ORDER, THE LD. CIT(A) HAS OBSERVE D THAT THE A.O. HAD FAILED TO CONSIDER THE SCHEME OF DEMERGER; HOWEVER, AS A MATTER OF FACT TH E ASSESSEE DID NOT SUBMIT ANY SCHEME OF DEMERGER BEFORE THE A.O. AND IT HAD FURNISHED ON LY TWO MOUS, CONTENTS OF WHICH ARE DIFFERENT FROM THE SCHEME APPROVED BY THE HONBLE H IGH COURT, WHICH WILL BE DISCUSSED SUBSEQUENTLY. IT TRANSPIRES FROM THE ORDER OF THE L D. CIT(A) THAT HE HAD PASSED THE ORDER WITHOUT HAVING GONE THROUGH THE SCHEME APPROVED BY THE HONBLE HIGH COURT AND THE ASSESSEE ALSO DID NOT SUBMIT THE COPY OF SCHEME BEF ORE THE LD. CIT(A) AND IT HAS ONLY BEEN FURNISHED IN THE CURRENT PROCEEDINGS ON INSISTENCE OF THE UNDERSIGNED AND DIRECTIONS OF THE HONBLE BENCH. (B) WHILE GRANTING RELIEF TO THE ASSESSEE ON ACCOUNT OF MONEY RECEIVED FROM ONE GURSIMRAN DISTILLERIES PVT LTD (GDPL), THE LD. CIT(A) HAS PLA CED RELIANCE ON THE SUPPLEMENTARY MOU DATED 23.09.2006, WHILE THE NAME OF GDPL DOES NOT A PPEAR IN THE SANCTIONED SCHEME AT ALL. THE LD. CIT(A) WAS MISGUIDED BY THE ASSESSEE BY FUR NISHING ONLY TWO MOUS AND NOT THE SANCTIONED SCHEME. IF ALL THE TRANSACTIONS WERE IN FURTHERANCE OF THE SUPPLEMENTARY MOU, I.T.A. NO. 408/ASR/2016 & C.O. NO. 21/ASR/2016 4 THEN THE ASSESSEE SHOULD HAVE GOT RS. 30 CRORES AS SALE RECEIPTS AND SECTION 2(19AA) WILL NOT COME INTO PICTURE. THE LD. CIT(A) HAS NOT APPRECIAT ED THE MOUS IN CORRECT PERSPECTIVE AND TOTALITY OF THE FACTS. (C) EVEN IF THE ABOVE VITAL ASPECTS OF THE CASE ARE NOT CONSIDERED, THEN ALSO THE LD CIT(A) HAS JUST ACCEPTED THE CONTENTIONS OF THE ASSESSEE WITHOUT CO NSIDERING THE RAMIFICATIONS AND TAX IMPLICATIONS. IT IS A SETTLED LAW THAT THE POWERS O F THE CIT(A) ARE CO-TERMINUS WITH THAT OF THE A.O., THEREFORE, THE CIT(A) SHOULD HAVE INQUIRED TH E TAX TREATMENT OF THE MONEY RECEIVED BY THE HOLDING COMPANY BIERMANN CARD CO PVT LTD IN THE YEAR UNDER CONSIDERATION. (D) THE LD. CIT(A) HAS OBSERVED ON PAGE-17 THAT- THEREFORE THE APPELLANT WAS NOT THE BENEFICIAL RE CIPIENT OF THE AMOUNT OF RS. 8.36 CRORE FROM BML OR RS. 3.54 CRORE RECEIVED FROM GDPL DURIN G THE YEAR UNDER CONSIDERATION AS STATED ABOVE AND NO ADDITION IN RESPECT THEREOF IS CALLED FOR AS NO SALE/TRANSFER OF KHASA DISTILLERY UNIT OF THE ASSESSEE WAS AFFECTED DURING THE YEAR UNDER CONSIDERATION SINCE THE APPROVAL OF THE HONBLE HIGH COURT OF THE MOU DATED 18.05.2006 WAS STILL PENDING. THE A.O. HAS MADE THE ADDITION OF RS. 11,90,00,000 FOR THE REASON THAT THE SCHEME OF DEMERGER/MERGER/AMALGAMATION WAS IMPLEMENTED OR NOT IS NOT CLEAR IN THIS YEAR AND WAS OF UNEXPLAINED NATURE AND SOURCE TO AVOID POSSIBLE LEAKAGE OF REVENUE. THIS CLEARLY SHOWS THAT THE ADDITION WAS MADE BY THE A.O. FOR THE REAS ON THAT HE NEVER UNDERSTOOD THE SCHEME OF DEMERGER OF KHASA DISTILLERY COMPANY OF THE ASSE SSEE AND SUCH AN ADDITION CANNOT BE SUSTAINED. ALSO NO ADDITION IS CALLED FOR AS THE SO URCE, NATURE AND GENUINENESS OF THE TRANSACTIONS OF RS. 8,36,00,000 AND RS. 3,54,00,000 WAS FULLY EXPLAINED WITH SUPPORTING EVIDENCES AND BANK STATEMENTS/BOOKS OF ACCOUNT AND THE EXECUTED MOU AND SUPPLEMENTARY MOU. IT IS SUBMITTED AT THE COST OF REPETITION THAT NEIT HER ANY MOU OR SUPPLEMENTARY MOU IS MENTIONED IN THE SANCTIONED SCHEME, NOR NAME OF GDP L IS APPEARING IN THE SANCTIONED SCHEME. FURTHER, THE LD. CIT(A) WAS HEARING APPEAL OF A RE-OPENED CASE IN 2015-16, BY WHICH EVERYTHING WAS COMPLETED. SO, HE COULD HAVE VERY WE LL EXAMINED ALL ASPECTS OF THE TRANSACTIONS AFTER SANCTION OF THE SCHEME BY THE HO NBLE HIGH COURT. IT IS TO BE FURTHER NOTED THAT ONE IMPORTANT SALE TRANSACTIONS ESCAPED THE AT TENTION OF THE LD. CIT(A) MENTIONED EVEN IN THE MOUS. THIS IS REFERRED IN PARA 3.4 OF THE OR IGINAL MOU AND PARA 1.6 OF THE SUPPLEMENTARY MOU. PARA 3.4 OF THE ORIGINAL MOU DATED 18.05.2006 READS AS UNDER- OUT OF THE SALE CONSIDERATION, A SUM OF RS. 1,35, 00,000 SHALL BE PAID AS CONSIDERATION UPON EXECUTION AND REGISTRATION OF THE SALE-DEED IN FAVOUR OF THE COMPANY(S) NOMINATED BY BML IN RESPECT OF 32 ACRES OF LAND AT KHASA WHIC H IS UNDER CONTROL OF COMPANIES MANAGED BY MR SHASHANK BHAGAT. THE SALE DEEDS SHALL BE EXECUTED ON OR BEFORE THE EXECUTION OF THE LEASE DEED. THE SAID COMPANIES SHA LL CONTINUE TO BE OWNED AND I.T.A. NO. 408/ASR/2016 & C.O. NO. 21/ASR/2016 5 MANAGED BY MR SHASHANK BHAGAT AND MRS SULOCHANA BHA GAT TILL PAYMENT OF TOTAL SALE CONSIDERATION. PARA 1.6 OF THE SUPPLEMENTARY MOU READS AS UNDER- LORD PROPERTIES PVT LTD MEANS A COMPANY INCORPORA TED IN INDIA HAVING ITS REGISTERED OFFICE AT LUDHIANA, WHICH HAS BECOME THE REGISTERED OWNER OF 32 ACRES AT KHASA DISTRICT AMRITSAR THE SHARES OF WHICH SHALL EVENTUALLY BE TR ANSFERRED TO BML UPON THE PAYMENT OF THE LAST INSTALMENT OF RS. 16,75,00,000 ALONG WITH PAYMENTS TOWARDS NET CURRENT ASSETS READILY CONVERTIBLE INTO MONEY, OWNE D BY LORD PROPERTIES PVT LTD. FURTHER, PARA 5.2 OF THE SUPPLEMENTARY MOU READS AS UNDER- BICL AGREEING TO EXECUTE THE LEASE DEED IN FAVOUR OF GDPL AND GDPL EXECUTING THE LEASE NOT LATER THAN 30 TH SEPTEMBER, 2006 UPON PAYMENT OF RS. 4.89 CRORE BY GDPL TO BCPL ( 3.54 CRORE) AND LORD PROPERTIES ( RS. 1.35 CRORE). IT IS CLEAR FROM THE ABOVE FACTS THAT PAYMENT RECEI VED FROM GDPL IS SALE CONSIDERATION AGAINST TRANSFER OF LAND. IT IS TO BE FURTHER NOTED THAT AT PAGE NO. 1 OF THE SUPPLEMENTARY MOU ( PAGE 24 OF THE PAPER-BOOK FILED BY THE ASSESS EE DATED 26.09.2016) DESCRIBES LORD PROPERTIES AS UNDER- LORD PROPERTIES PVT LTD IS A COMPANY INCORPORATED UNDER THE LAWS OF INDIA, HAVING ITS REGISTERED OFFICE AT 54, JANPATH, NEW DELHI ( HEREI NAFTER REFERRED TO AS LPPL WHICH TERM SHALL UNLESS THE CONTEXT OTHERWISE REQUIRES INCLUDE ITS SUCCESSORS IN INTEREST AND PERMITTED ASSIGNS) THROUGH MR SHASHANK BHAGAT ACTING AS DIREC TOR OF LPPL. (E) THE LD. CIT (A) COULD NOT GET THE ENTIRE PICTURE OF WEB OF TRANSACTIONS FOR WANT OF AVAILABILITY OF THE APPROVED SCHEME. AS PER THE SCHEME, THERE WA S REDUCTION IN CAPITAL OF THE DEMERGED ENTITY. IT HAS BEEN MENTIONED IN THE APPROVED SCHEM E THAT ISSUED, SUBSCRIBED AND PAID-UP CAPITAL OF THE RESULTING COMPANY WILL BE REDUCED BY RS. 49,92,000 AND AFTER REDUCTION THE PAID UP CAPITAL WOULD BE RS. 62,40,000. IT HAS BEEN CLEARLY MENTIONED IN THE SCHEME THAT AS AN INTEGRALLY CONNECTED PART OF THE SCHEME AND UPON COMING INTO EFFECT OF THIS SCHEME WITH EFFECT FROM THE APPOINTED DATE, THIS REDUCTION WILL HAPPEN AS PER THE PROVISIONS OF SECTION 100-103 OF THE COMPANIES ACT READ WITH ARTICLE 49 O F THE ARTICLES OF ASSOCIATION OF THE RESULTING COMPANY. IT IS CLEAR FROM THE ABOVE DISCUSSION THAT PAYMENT BY GDPL WAS IN LIEU OF LAND TRANSACTION AND FINDING OF THE LD. CIT(A) IN THIS REGARD WAS NO T BASED ON THE APPRECIATION OF CORRECT FACTS. I.T.A. NO. 408/ASR/2016 & C.O. NO. 21/ASR/2016 6 4. REVERTING TO THE SCHEME APPROVED BY THE HIGH COURT, IT IS SUBMITTED THAT COPY OF THE SCHEME FURNISHED TO THE HONBLE HIGH COURT AS SUBMITTED BY THE LD AR OF THE ASSESSEE THROUGH E-MAIL IS ENCLOSED AS ANNEXURE-2 OF THE SUBMISSIONS. IT IS CL EAR FROM THE ABOVE SCHEME THAT APPOINTED DATE OF THE DEMERGER WAS 01.04.2006 AS PER THE SCH EME AND THEREFORE, THIS YEAR AND NOT THE SUBSEQUENT YEAR (AS CLAIMED BY THE LD. AR OF THE AS SESSEE DURING HEARING ON 16.09.2021), IS THE RELEVANT YEAR FOR DEMERGER. IT IS TO BE FURTHER NOT ICED THAT ORIGINAL MOU DATED 18.05.2006 AND SUPPLEMENTARY MOU DATED 23.09.2006 DO NOT FIND ANY MENTION IN THE APPROVED SCHEME. FURTHER, THE NAME OF COMPANY GDPL IS NOWHERE MENTIO NED IN THE SAID SCHEME, NEITHER THE LAND TRANSACTION OF 32 ACRES AT KHASA IS MENTIONED IN TH E SCHEME. THE DIFFERENCES ON CRUCIAL ISSUE IN THE APPROVED SC HEME VIS--VIS MOU AND SUPPLEMENTARY MOU ARE TABULATED AS UNDER- S. NO . SANCTIONED SCHEME MOU DATED 18.05.20 06 MOU DATED 23.09.20 06 1 SALE CONSIDER ATION IS MENTION ED AS RS. 33.50 CR TO BICL AGAINST TRANSFER OF 92.14% ISSUED AND PAID- UP SHARES OF THE TRANSFERE E COMPANY TO BML ( PARA 2.1) SALE CONSIDER ATION IS MENTION ED AS RS. 30 CR TO BICL AGAINST TRANSFER OF 92.14% ISSUED AND PAID- UP SHARES OF THE TRANSFERE E COMPANY TO GDPL ( PARA 2.1) I.T.A. NO. 408/ASR/2016 & C.O. NO. 21/ASR/2016 7 THERE IS NO MENTION OF SALE CONSIDERATION AS SUCH. NO MENTION OF REFUND OF RS. 5.22 CR.IN PARA 1 (C)(I ), BUT OTHERWISE DEFINITION IS SIMILAR. ALL ASSETS OF THE DISTILLERY UNDERTAKI NG COMES WITHIN THE DEFINITION OF THE DISTILLERY UNDERTAK ING EXCEPT FOR SALES/PUR CHASE TAX PENDING SINCE 1989 FOR WHICH A REFUND OF APPROXI MATELY RS. 5,33,00,0 00 PLUS INTEREST ALL ASSETS OF THE DISTILLERY UNDERTAKI NG COMES WITHIN THE DEFINITION OF THE DISTILLERY UNDERTAK ING EXCEPT FOR SALES/PUR CHASE TAX PENDING SINCE 1989 FOR WHICH A REFUND OF APPROXI MATELY RS. 5,33,00,0 00 PLUS INTEREST I.T.A. NO. 408/ASR/2016 & C.O. NO. 21/ASR/2016 8 IS DUE TO BICL. [PARA 1.2(I)] IS DUE TO BICL. [PARA 1.2(I)] PAYMENT OF RS. 8.36 CRORE ALREADY MADE BY BML TO BICL. ( PARA 3.1 & 3.2) PAYMENT OF RS. 8.36 CRORE ALREADY MADE BY BML TO BICL. ( PARA 3.1 & 3.2) PAYMENT OF RS. 3.54 CRORE PAID TO BCPL ( PARA 3.3) NAME OF GDPL IS NOT MENTIONED IN THE APPROVED SCHEM E. NO SUCH CLAUSE, AS IS APPEARIN G IN THE SUPPLEM ENTARY MOU. WHEREAS GDPL IS A GROUP COMPANY OF BML IN SO FAR AS H.S BAGGA AND K.S.BAGGA WITH THEIR RESPECTIV E FAMILY MEMBERS , JOINTLY OWN 80% OF THE EQUITY SHARE CAPITAL OF GDPL THE BALANCE BEING HELD BY I.T.A. NO. 408/ASR/2016 & C.O. NO. 21/ASR/2016 9 MR RAM REDDY AND MR SUNIL TALWAR. BML HAS ASSURED AND REPRESEN TED THAT GDPL IS UNDER THEIR MANAGE MENT CONTROL AND OWNERSHI P AND THE BOARD OF DIRECTORS OF BML HAVE AGREED THAT GDPL SHALL FULFIL ALL RESPONSI BILITIES AND OBLIGATIO N AS ENVISAGE D IN THE MOU DATED 18 TH MAY 2006 EXECUTED BETWEEN BICL AND BML. THERE IS NO MENTION OF LAND TRANSACTION AND LPPL IN THE SCHEME. OUT OF THE SALE CONSIDER LORD PROPERTIE S PVT LTD I.T.A. NO. 408/ASR/2016 & C.O. NO. 21/ASR/2016 10 ATION, A SUM OF RS. 1,35,00,0 00 SHALL BE PAID AS CONSIDER ATION UPON EXECUTIO N AND REGISTRATI ON OF THE SALE- DEED IN FAVOUR OF THE COMPANY (S) NOMINATE D BY BML IN RESPECT OF 32 ACRES OF LAND AT KHASA WHICH IS UNDER CONTROL OF COMPANI ES MANAGED BY MR SHASHANK BHAGAT. THE SALE DEEDS SHALL BE EXECUTED ON OR BEFORE THE EXECUTIO MEANS A COMPANY INCORPOR ATED IN INDIA HAVING ITS REGISTERE D OFFICE AT LUDHIANA , WHICH HAS BECOME THE REGISTERE D OWNER OF 32 ACRES AT KHASA DISTRICT AMRITSAR THE SHARES OF WHICH SHALL EVENTUALL Y BE TRANSFERR ED TO BML UPON THE PAYMENT OF THE LAST INSTALME NT OF RS. 16,75,00, 000 ALONG WITH PAYMENT S TOWARDS NET CURRENT ASSETS I.T.A. NO. 408/ASR/2016 & C.O. NO. 21/ASR/2016 11 N OF THE LEASE DEED. THE SAID COMPANI ES SHALL CONTINUE TO BE OWNED AND MANAGED BY MR SHASHANK BHAGAT AND MRS SULOCHAN A BHAGAT TILL PAYMENT OF TOTAL SALE CONSIDER ATION ( PARA 3.4) READILY CONVERTIB LE INTO MONEY, OWNED BY LORD PROPERTIE S PVT LTD ( PARA 1.6) SUBJECT TO THE TERMS OF THIS MOU, THE PARTIES AGREE THAT 100% OF THE TOTAL ISSUED AND PAID- UP SHARE CAPITAL OF THE M/S LORD PROPERTIE S PVT LTD SHALL BE TRANSFERR ED IN FAVOUR OF GDPL AGAINST PAYMENT TO BE MADE IN ACCORDAN CE WITH THE PRECEDIN G CLAUSE( PARA 2.2) I.T.A. NO. 408/ASR/2016 & C.O. NO. 21/ASR/2016 12 5. IT IS CLEAR FROM THE ABOVE DISCUSSION THAT AMOUNT O F RS. 3.64 CR RECEIVED BY BICL FROM GDPL IS CONNECTED WITH THE ENTIRE TRANSACTIONS, BUT DELIBER ATELY KEPT OUT OF THE SCHEME IN ORDER TO AVOID ANY VIOLATION OF SECTION 2(19AA) OF THE ACT. THEREF ORE, THE TRANSACTIONS ARE NOT MENTIONED IN THE SCHEME. THE SUBSEQUENT PAYMENT OF RS. 3.64 CR BY TH E ASSESSEE TO BCPL WILL NOT SAVE THE ASSESSEE FROM TAX IMPLICATIONS. THE DIFFERENCE OF T HE SALE AMOUNT OF RS. 3.50 CRORE BETWEEN THE ORIGINAL MOU AND THE SUPPLEMENTARY MOU HAS ESCAPED ATTENTION OF THE LD. CIT(A). THE ASSESSEE HAS NOT BEEN ABLE TO EXPLAIN THE AMOUNT CREDITED IN ITS BOOKS OF ACCOUNT TO THE EXTENT OF RS. 3.64 CR. AND THIS AMOUNT IS LIABLE TO BE TAXED IN T HE HANDS OF THE ASSESSEE . FURTHER, THE 32 ACRE LAND TRANSACTION ALSO ESCAPED THE ATTENTION OF THE LD. CIT(A). THUS, AMOUNT OF RS. 1.35 CRORE IS ALSO LIABLE TO BE ADDED IN THE HANDS OF TH E ASSESSEE . 6. IT IS TO BE FURTHER MENTIONED THAT AMOUNT OF RS. 8. 36 CRORE RECEIVED BY THE ASSESSEE IS ALSO LIABLE TO BE TAXED IN THE HANDS OF THE ASSESSEE , AS IT IS DELIBERATELY NOT MENTIONED IN THE SCHEME OF DEMERGER. THIS AMOUNT MIGHT HAVE BEEN RECEIVED B Y THE ASSESSEE BECAUSE OF THE DEFAULT OF THE BML IN IMPLEMENTING THE MOU DATED 13 TH MAY, 2006. SUBSEQUENT REPAYMENT BY THE ASSESSEE MAY BE FOR SOME OTHER TRANSACTION, AS THERE IS COBW EB OF TRANSACTIONS IN THIS ENTIRE BUSINESS RESTRUCTURING SCHEME. IT IS CLEARLY MENTIONED IN PA RA 11.2 OF THE MOU THAT THE BICL WILL FORFEIT THE AMOUNT OF RS. 16,75,00,000 IF BML DEFAULTS IN M AKING PAYMENT OF INSTALMENTS. ALTHOUGH IN THE SUPPLEMENTARY MOU, THIS DEFAULT HAS BEEN WAIVED BUT THERE IS STRONG POSSIBILITY THAT THE ASSESSEE HAS BEEN PAID IN CASH AFTER SQUARING UP TH E TRANSACTIONS IN BOOKS IN ORDER TO MAKE THE TRANSACTIONS WITHIN THE PARAMETERS OF SECTION 2(19A A) OF THE ACT. THE AMOUNT OF FORFEITURE MIGHT HAVE BEEN ONLY RS. 8.36 CRORE INSTEAD OF RS. 16.75 CRORE AS A MATTER OF COMPROMISE BETWEEN THE PARTIES, AS ASSESSEE HAD RECEIVED ONLY THIS AMOUNT TILL DATE OF SIGNING OF THE SUPPLEMENTARY MOU . FURTHER, THE AMOUNT OF REFUND OF RS. 5.33 CR DUE TO BCIL HAS NOT BEEN MENTIONED IN THE SCHEME, AS IT WOULD HAVE VIOLATED THE CONDITIONS SP ECIFIED IN SECTION 2(19AA) OF THE ACT. 7. THE DEMERGER HAS BEEN DEFINED IN SECTION 2(19AA) OF THE ACT AS UNDER: 'DEMERGER', IN RELATION TO COMPANIES, MEANS THE TRA NSFER, PURSUANT TO A SCHEME OF ARRANGEMENT UNDER SECTIONS 391 TO 394 OF THE COMPAN IES ACT, 1956 (1 OF 1956), BY A DEMERGED COMPANY OF ITS ONE OR MORE UNDERTAKINGS TO ANY RESULTING COMPANY IN SUCH A MANNER THAT ( I ) ALL THE PROPERTY OF THE UNDERTAKING, BEING TRANSFER RED BY THE DEMERGED COMPANY, IMMEDIATELY BEFORE THE DEMERGER, BECOMES THE PRO PERTY OF THE RESULTING COMPANY BY VIRTUE OF THE DEMERGER; ( II ) ALL THE LIABILITIES RELATABLE TO THE UNDERTAKING, B EING TRANSFERRED BY THE DEMERGED COMPANY, IMMEDIATELY BEFORE THE DEMERGER, BECOME TH E LIABILITIES OF THE RESULTING COMPANY BY VIRTUE OF THE DEMERGER; ( III ) THE PROPERTY AND THE LIABILITIES OF THE UNDERTAKING OR UNDERTAKINGS BEING TRANSFERRED BY THE DEMERGED COMPANY ARE TRANSFERRED AT VALUES APPE ARING IN ITS BOOKS OF ACCOUNT IMMEDIATELY BEFORE THE DEMERGER: [ PROVIDED THAT THE PROVISIONS OF THIS SUB- CLAUSE SHALL NOT APPLY WHERE THE RESULTING COMPANY RECORDS THE VALUE OF THE PROPERTY AND THE L IABILITIES OF THE UNDERTAKING OR UNDERTAKINGS AT A VALUE DIFFERENT FROM THE VALUE AP PEARING IN THE BOOKS OF ACCOUNT OF THE DEMERGED COMPANY, IMMEDIAT ELY BEFORE THE DEMERGER, IN COMPLIANCE TO THE INDIA N ACCOUNTING STANDARDS SPECIFIED IN ANNEXURE TO THE C OMPANIES (INDIAN ACCOUNTING STANDARDS) RULES, 2015;] ( IV ) THE RESULTING COMPANY ISSUES, IN CONSIDERATION OF T HE DEMERGER, ITS SHARES TO THE I.T.A. NO. 408/ASR/2016 & C.O. NO. 21/ASR/2016 13 SHAREHOLDERS OF THE DEMERGED COMPANY ON A PROPORTIO NATE BASIS [EXCEPT WHERE THE RESULTING COMPANY ITSELF IS A SHAREHOLDER OF THE DE MERGED COMPANY]; ( V ) THE SHAREHOLDERS HOLDING NOT LESS THAN THREE- FOURTHS IN VALUE OF THE SHARES IN THE DEMERGED COMPANY (OTHER THA N SHARES ALREADY HELD THEREIN IMMEDIATELY BEFORE TH E DEMERGER, OR BY A NOMINEE FOR, THE RESULTING COMPAN Y OR, ITS SUBSIDIARY) BECOME SHARE- HOLDERS OF THE RESULTING COMPANY OR COMPANIES BY VI RTUE OF THE DEMERGER, OTHERWISE THAN AS A RESULT OF THE ACQUIS ITION OF THE PROPERTY OR ASSETS OF THE DEMERGED COMPANY OR ANY UNDERTAKING THEREOF BY THE RESULTING COMPANY; ( VI ) THE TRANSFER OF THE UNDERTAKING IS ON A GOING CONCE RN BASIS; ( VII ) THE DEMERGER IS IN ACCORDANCE WITH THE CONDITIONS, IF ANY, NOTIFIED UNDER SUB- SECTION (5) OF SECTION 72A BY THE CENTRAL GOVERNMENT IN THIS BEHALF. EXPLANATION 1. FOR THE PURPOSES OF THIS CLAUSE, 'UNDERTAKING' SHAL L INCLUDE ANY PART OF AN UNDERTAKING, OR A UNIT OR DIVISION OF AN UNDER TAKING OR A BUSINESS ACTIVITY TAKEN AS A WHOLE, BUT DOES NOT INCLUDE INDIVIDUAL ASSETS OR LIABILITIES O R ANY COMBINATION THEREOF NOT CONSTITUTING A BUSINESS ACTIVITY. EXPLANATION 2. FOR THE PURPOSES OF THIS CLAUSE, THE LIABILITIES RE FERRED TO IN SUB-CLAUSE ( II ), SHALL INCLUDE ( A ) THE LIABILITIES WHICH ARISE OUT OF THE ACTIVITIES O R OPERATIONS OF THE UNDERTAKING; ( B ) THE SPECIFIC LOANS OR BORROWINGS (INCLUDING DEBENTU RES) RAISED, INCURRED AND UTILISED SOLELY FOR THE ACTIVITIES OR OPERATIONS OF THE UNDE RTAKING; AND ( C ) IN CASES, OTHER THAN THOSE REFERRED TO IN CLAUSE ( A ) OR CLAUSE ( B ), SO MUCH OF THE AMOUNTS OF GENERAL OR MULTIPURPOSE BORROWINGS, IF ANY, OF T HE DEMERGED COMPANY AS STAND IN THE SAME PROPORTION WHICH THE VALUE OF THE ASSETS T RANSF ERRED IN A DEMERGER BEARS TO THE TOTAL VALUE OF THE ASSETS OF SUCH DEMERGED COMPANY IMMEDIATELY BEFORE THE DEMERGER. EXPLANATION 3. FOR DETERMINING THE VALUE OF THE PROPERTY REFERRED TO IN SUB- CLAUSE ( III ), ANY CHANGE IN THE VALUE OF ASSETS CONSEQUENT TO THEIR REVALUATION SHALL BE IGNORED. EXPLANATION 4. FOR THE PURPOSES OF THIS CLAUSE, THE SPLITTING UP O R THE RECONSTRUCTION OF ANY AUTHORITY OR A BODY CONSTITUTED OR ESTABLISHED UNDER A CENTRAL, STATE OR PROVINCIAL ACT, OR A LOCAL AUTHORITY OR A PUBL IC SECTOR COMPANY, INTO SEPARATE AUTHORITIES OR BOD IES OR LOCAL AUTHORITIES OR COMPANIES, AS THE CASE MAY BE, SHALL BE DEEMED TO BE A DEMERGER IF SUCH SPLIT UP OR RECONSTRUCTION FULFILS [SUCH CONDITIONS AS MAY BE NOTIFIED IN THE OFFICIAL GAZETTE, BY THE CENTRAL GOVERNMENT]. [ EXPLANATION 5. FOR THE PURPOSES OF THIS CLAUSE, THE RECONSTRUCTION OR SPLITTING UP OF A COMPANY, WHICH CEASED TO BE A PUBLIC SECTOR COMPANY AS A RESULT OF TRANSFER OF ITS SHARES BY THE CENTRAL GOVERNMENT, INTO SEPARATE COM PANIES, SH ALL BE DEEMED TO BE A DEMERGER, IF SUCH RECONSTRUCTION OR SPLITTING UP HA S BEEN MADE TO GIVE EFFECT TO ANY CONDITION ATTACHED TO THE SAID TRANSFER OF SHARES A ND ALSO FULFILS SUCH OTHER CONDITIONS AS MAY BE NOTIFIED 5 BY THE CENTRAL GOVERNMENT IN THE OFFICIAL GAZETTE. ] [ EXPLANATION 6. FOR THE PURPOSES OF THIS CLAUSE, THE RECONSTRUCTION OR SPLITTING UP OF A PUBLIC SECTOR COMPANY INTO SEPARATE COMPANIES SHALL BE DEEMED TO BE A DEMERGER, IF SUCH RECONSTRUCTION OR SPLITTING UP HAS BEEN MADE TO TRANSFER ANY ASSET OF THE DEMERGED COMPANY TO THE RESULTING COMPANY AND THE R ESULTING COMPANY ( I ) IS A PUBLIC SECTOR COMPANY ON THE APPOINTED DAY IND ICATED IN SUCH SCHEME, AS MAY BE APPROVED BY THE CENTRAL GOVERNMENT OR ANY OT HER BODY AUTHORISED UNDER THE PROVISIONS OF THE COMPANIES ACT, 2013 (18 OF 2013) OR ANY OTHER LAW FOR THE TIME BEING IN FORCE GOVERNING SUCH PUBL IC SECTOR COMPANIES IN THIS BEHALF; AND I.T.A. NO. 408/ASR/2016 & C.O. NO. 21/ASR/2016 14 ( II ) FULFILS SUCH OTHER CONDITIONS AS MAY BE NOTIFIED BY THE CENTRAL GOV ERNMENT IN THE OFFICIAL GAZETTE IN THIS BEHALF. AS PER THE ABOVE DISCUSSION, AS THE ASSESSEE HAS VI OLATED THE CONDITIONS MENTIONED IN SECTION 2(19AA) OF THE ACT, THEREFORE, THIS BUSINESS RESTRU CTURING CANNOT BE TERMED AS DEMERGER AS PER THE PROVISIONS OF THE ACT. HENCE, ASSESSEE I S LIABLE TO PAY CAPITAL GAINS TAX. THEREFORE, IT IS REQUESTED TO KINDLY CONFIRM THE ADDITIONS MAD E BY THE A.O. AND ALLOW THE APPEAL OF THE REVENUE. FURTHERMORE, THE MATTER MAY BE RESTORED BA CK TO THE FILE OF THE A.O. TO EXAMINE THE ENTIRE GAMUT OF THE TRANSACTIONS AND TO ASCERTA IN WHETHER IT IS A CASE OF DEMERGER OR NOT AS PER THE PROVISIONS OF THE INCOME-TAX ACT. FURTHE R, THE NECESSARY FINDING MAY ALSO KINDLY BE GIVEN IN THE CASE OF DIGVIJAY CHEMICALS LTD U/S 150(1) OF THE ACT AS THE VALUE OF EACH SHARE HAS BEEN REDUCED FROM RS. 10 TO RS.2, BUT THE MONEY HAS NOT BEEN RETURNED TO THE SHAREHOLDERS AND THE COMPANY HAS EARNED CAPITAL GAI NS TO THE EXTENT OF RS. 49,92,000 BY WAY OF REDUCTION IN CAPITAL. 8. IN THE INSTANT CASE THE ASSESSEE HAS USED COLORABLE DEVICE TO EVADE THE TAX LIABILITY, HENCE, THE HONBLE TRIBUNAL SHOULD SEE THE TOTALITY OF THE FAC TS AND CIRCUMSTANCES AND DECIDE THE MATTER. RELIANCE IS PLACED UPON THE FOLLOWING JUDGEMENTS- (A) MCDOWELL & CO. LTD V CTO, 22 TAXMAN 11 (SC) : THE HONBLE SUPREME COURT HAS HELD THAT- SO FAR AS THE CONTENTION THAT IT IS OPEN TO EVERY O NE TO SO ARRANGE HIS AFFAIRS AS TO REDUCE THE BRUNT OF TAXATION TO THE MINIMUM, WAS CONCERNED, TH E TAX PLANNING MAY BE LEGITIMATE PROVIDED IT IS WITHIN THE FRAMEWORK OF LAW. COLOURA BLE DEVICES CANNOT BE PART OF TAX PLANNING AND IT IS WRONG TO ENCOURAGE OR ENTERTAIN THE BELIE F THAT IT IS HONOURABLE TO AVOID THE PAYMENT OF TAX BY RESTORING TO DUBIOUS METHODS. IT IS THE O BLIGATION OF EVERY CITIZEN TO PAY THE TAXES HONESTLY WITHOUT RESORTING TO SUBTERFUGES. COURTS A RE NOW CONCERNING THEMSELVES NOT MERELY WITH THE GENUINENESS OF A TRANSACTION, BUT WITH THE INTENDED EFFECT OF IT FOR FISCAL PURPOSES. NO ONE CAN NOW GET AWAY WITH A TAX AVOIDANCE PROJECT W ITH THE MERE STATEMENT THAT THERE IS NOTHING ILLEGAL ABOUT IT. (B) VIPAN KHANNA V CIT& ANOTHER , ITA NO. 394/2010 ( PU NJAB & HARYANA HIGH COURT) : THE HONBLE HIGH COURT UPHELD THE DECISION OF THE H ON;BLE TRIBUNAL TO REMAND BACK THE MATTER TO THE CIT(A) OBSERVING THAT THE GENUINENESS OF THE DOCUMENTS RELIED UPON BY THE APPELLANT WAS REQUIRED TO BE GONE INTO BY THE CIT(A ) PROPERLY. (C) DLF UNIVERSAL LTD V DCIT, 36 SOT 1 (DELHI)(SB) (D) JEANS KNIT (P) LTD V DCIT, 38 TAXMANN.COM 112 (KAR) (E) CIT V WIPRO LTD, 50 TAXMANN.COM 21(KAR) (F) CIT V CARLTON HOTEL (P) LTD, 88 TAXMANN.COM 257 (AL L) I.T.A. NO. 408/ASR/2016 & C.O. NO. 21/ASR/2016 15 3. PER CONTRA, THE LD. AR FOR THE ASSESSEE SUBMITTE D THAT , ON THE DIRECTION OF THE BENCH , THE ASSESSEE HAVE PLACED T HE COPY OF THE SCHEME OF DEMERGER OF ASSESSEE AND DPCL APPROVED BY THE H ONBLE HIGH COURT OF DELHI VIDE DECISION DATED 17.12.2007. WE HAD AS KED THE LD. AR POINTED OUT AS TO BY WHICH LETTER/DOCUMENT DEMERGER SCHEME WAS PLACED BEFORE THE ASSESSING OFFICER OR BEFORE THE CIT(A). HOWEVER , DESPITE HIS BEST EFFORT, THE LD AR ASSISTED BY THE ASSESSEE REPRESEN TATIVE WERE NOT ABLE TO POINT OUT THE DATE OR THE DOCUMENT BY WHICH THE SCH EME OF DEMERGER WAS PLACED BEFORE THE LOWER AUTHORITIES. FACED BY THE S AID SITUATION AND FAILURE TO POINT OUT FROM THE RECORD THAT THE SCHEME OF THE MERGER WAS PLACED BEFORE THE LOWERE AUTHORITY , MOREPARTICULALY WHEN THE FINDING OF CIT(A)(A) WAS BASED ON CONCLUSION THAT AO HAD NOT CONSIDERED THE DEMERGER REPORT . LD. AR ON THE INSTRUCTIONS OF THE ASSESSEE REPRESEN TATIVE HAD FAIRLY SUBMITTED THAT THE MATTER MAY BE REMANDED BACK TO T HE FILE OF THE CIT(A) FOR DENOVO PASSING OF THE APPELLATE ORDER AFTER CON SIDERING THE SCHEME AND OTHER DOCUMENTS . HOWEVER, HE ALSO SUBMITTED , THE SCHEME WAS CONSIDERED BY THE ASSESSING OFFICER FOR THE ASSESSM ENT YEARS 2008-09 , CIT(A) AND THE TRIBUNAL. IN FACT, TRIBUNAL PASSED I TS ORDER AFTER CONSIDERING THE SCHEME IN ITS ORDER DATED 22.07.2019. I.T.A. NO. 408/ASR/2016 & C.O. NO. 21/ASR/2016 16 4. IN REBUTTAL THE LD. DR SUBMITTED THAT EVERY ASSE SSMENT ORDER IS INDEPENDENT ORDER AND THEREFORE THE FINDINGS RECORD ED BY THE TRIBUNAL FOR THE ASSESSMENT YEAR 2008-09 SHOULD NOT BE CONSIDERE D WHILE DECIDING THE ISSUE FOR THE 2007-08 ASSESSMENT YEAR. FURTHER, IT WAS CONTENDED THAT THE LD. DR THAT THE SCHEME WAS NOT FILED BY THE ASSESSE E BEFORE THE BENCH WHILE PASSING THE ORDER FOR THE AY 2008-09 . 5. WE HAVE CONSIDERED THE RIVAL CONTENTION OF THE P ARTIES AND PERUSED THE MATERIAL AVAILABLE ON RECORD, INCLUDING THE JUD GMENTS CITED AT BAR DURING THE COURSE OF HEARING BY BOTH THE PARTIES . LD. C IT(A) AT PAGE 14 HAVE WRONGLY STATED THAT THE ASSESSING OFFICER HAS FAILE D TO CONSIDER THIS SCHEME OF MERGER. AT PAGE 14 IT WAS MENTIONED IN T HE ORDER AS UNDER: THE ASSESSING OFFICER HAD FAILED TO CONSIDER THE S CHEME OF DEMERGER THAT THE MONEYS FOR THE TRANSFER OF THE KHASA DISTILLERY UNI T OF THE ASSESSEE WERE TO BE RECEIVED BY THE TRANSFERORS OF SHARES OF THE TRANSF EREE COMPANY (M/S DIGVIJAY CHEMICALS LTD.) INTO WHICH THE DEMERGED UNIT WAS ME RGED AFTER THE HONBLE HIGH COURT OF DELHIS ORDER. 6. IN OUR CONSIDERED OPINION EVEN THE CIT(A) HAVE F AILED TO CONSIDER THE EFFECT OF SCHEME WHICH WAS UNDOUBTEDLY BETWEEN THE ASSESSEE AND DIGVIJAY CHEMICAL LTD. , WHEREAS AE PER MOU ASSESS EE HAD RECEIVED RS. 8.36 CRORES FROM BAGGA MILLENIUM PVT. LTD. AND AT R S. 3.54 CRORES FROM GURSIMRAN MILLENNIUM LIQUOR (INDIA) PVT LTD. FURTH ER LD. CIT(A) HAD ALSO I.T.A. NO. 408/ASR/2016 & C.O. NO. 21/ASR/2016 17 FAILED TO CONSIDER THE RECEIPT OF SHARES BY BAGGA D ISTILLERY ON ACCOUNT OF DEMERGER AND ITS TAX IMPLICATIONS , EITHER IN THE H ANDS OF ASSESSEE OR DIGVIJAY CHEMICAL LTD. ,OR IN THE HANDS OF BAGGA M ILLENIUM PVT. LTD. FURTHER CIT(A) HAD FAILED TO SATISFY HIMSELF THE NA TURE OF RECEIPT OF RS. 8.36 CRORES FROM BAGGA MILLENIUM PVT. LTD. AND AT RS. 3. 54 CRORES FROM GURSIMRAN MILLENNIUM LIQUOR (INDIA) PVT LTD, I.E WH ETHER IT WAS INCOME OF THE ASSESSEE OR NOT IN THE YEAR UNDER CONSIDERATION . FURTHER THE CIT(A) HAS WRONGLY PASSED THE ORDER WITHOUT DISCUSSING IN DETA IL THE MOU, THE SCHEME OF DEMERGER AND THE ADDITIONAL MOU. CIT DR IN THE D ETAILED WRITTEN SUBMISSIONS FILED BEFORE US HAD HIGHLIGHTED VARIOUS POINTS WHICH GOES TO THE ROOT OF THE MATTER AND WERE NOT CONSIDERED BY T HE CIT(A) WHILE PASSING THE IMPUGNED APPELLATE ORDER. 7. IN THE LIGHT WE DEEM IT APPROPRIATE TO REMAND BA CK BOTH THE APPEALS AND THE CO TO THE FILE OF THE CIT(A) FOR DE-NAVO DECISI ON OF ALL THE ISSUES RAISED IN THE APPEAL IN ACCORDANCE WITH LAW . THE CIT(A) I S DIRECTED TO CONSIDER ALL THE DOCUMENT FILED BY THE ASSESSEE INCLUDING THE ME MORANDUM OF UNDERSTANDING ,SCHEME OF DEMERGER AND THE ORDER PAS SED BY THE HONBLE HIGH COURT OF PROVING THE DEMERGER. WE MAKE IT ABUN DANTLY CLEAR THAT THE LD. CIT(A) WHILE DECIDING THE APPEAL SHALL CONSIDER THE WRITTEN SUBMISSIONS I.T.A. NO. 408/ASR/2016 & C.O. NO. 21/ASR/2016 18 REPRODUCED HEREIN ABOVE, FILED BY THE CIT-DR DURING THE COURSE OF HEARING BEFORE US DATED 20 TH SEPTEMBER, 2021 . FURTHER THE CIT(A) SHALL NOT BE INFLUENCED BY THE ORDER PASSED BY THE TRIBUNAL FOR THE ASSESSMENT YEAR 2008-09. WE MAKE IT ABUNDANTLY CLEAR THAT THE ORDER DATED 22.7.2019 WAS PASSED BY THE COORDINATE BENCH IN THE PECULIAR FACT S AND CIRCUMSTANCES OF THE CASE, AS THE SCHEME OF DEMERGER, WHICH WAS THE BONE OF CONTENTION BETWEEN THE PARTIES, WAS NOT FILLED , CONSIDERED AN D REFERRED BY THE COORDINATE BENCH WHILE PASSING THE ORDER FOR THE AS SESSMENT YEAR 2008 2009. THE CIT(A) IS DIRECTED TO PASS FRESH SPEAKIN G ORDER, IN TERMS OF DIRECTION GIVEN HEREIN ABOVE , AFTER FOLLOWING TH E PRINCIPLE OF NATURAL JUSTICE AND AFFORDING THE OPPORTUNITY OF HEARING TO THE ASS ESSEE. 8. NOTHING STATED THEREIN SHALL BE CONSTRUED AS ADJ UDICATION OF ANY OF THE GROUNDS RAISED BY BOTH THE PARTIES AS, THE BENCH HA S MERELY STATED THE FACTS WHICH ARE NECESSARY FOR REMANDING THE MATTER. 9. IN THE LIGHT OF THE ABOVE, THE APPEAL OF THE REV ENUE IS ALLOWED FOR STATISTICAL PURPOSES AND CO IS ALSO ALLOWED FOR STATISTICAL PUR POSES. ORDER PRONOUNCED IN THE OPEN COURT ON 20.09.2021 SD/- SD/- (DR. M. L. MEENA) (LALIET KUMAR) ACCOUNTANT MEMBER J UDICIAL MEMBER I.T.A. NO. 408/ASR/2016 & C.O. NO. 21/ASR/2016 19 DOC COPY OF THE ORDER FORWARDED TO: (1)THE APPELLANT (2) THE RESPONDENT (3) THE CIT (4) THE CIT (APPEALS) (5) THE DR, I.T.A.T. TRUE COPY BY ORDER