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2015 (11) TMI 1215 - DELHI HIGH COURTSale consideration received by transfer of shares and sale of rights entitlement of partly convertible of partly convertible Debentures (PCDs) - ITAT held as income from capital gains and not income from business - Loss on sale of entitlement to acquire partly convertible debentures - ITAT held assessee is entitled to set off the alleged loss from the capital gains/income earned by the assessee - Held that:- The Assessee had held the shares of JISCO and JSL as stock-in-trade in its final accounts as on 31st March, 1991 and had valued the same at cost or market price whichever was lower. According to the Assessee, its board of directors decided to retain the said shares on long term basis and consequently passed a resolution on 4th April, 1991 that the shares held by it be treated as investment/capital. The AO held that the funds received from sale of shares had been transferred to related companies within the group. The AO further held that the transaction of renunciation of rights were a sham transactions and a device to purchase notional losses. At the outset, the learned counsel for the parties submitted that the material facts and issues in the present appeal were similar to the issues involved in Commissioner of Income Tax Delhi-I v. M/s Abhinandan Investment Ltd. - Decided in favour of the Revenue and against the Assessee.
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