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2019 (1) TMI 1414 - BOMBAY HIGH COURTNature of loss - capital loss or business loss - company in liquidation - assesssee claimed the same as business loss - Tribunal allowed the same as capital loss - Held that:- the assessee having made investment and suffered losses in the process, had claimed such loss as a business loss. The Tribunal instead treated such loss on capital account and was urged to examine the alternative contention of the assessee that such loss in any case, would be recognized as a capital loss. The Tribunal merely accepted the same making reference to the decisions of the Supreme Court and also referring to Section 46(2) of the Act. No error in the view of the Tribunal. If the loss suffered by the assessee was treated as capital loss, there is nothing on record to hold that the assessee was not entitled to claim the same as such. Claim of the assessee would also get support from Section 46(2) of the Act. Section 46(1) of the Act provides that notwithstanding anything contained in Section 45, where the assets of a company are distributed to its shareholders on its liquidation, such distribution shall not be regarded as a transfer by the company for the purposes of Section 45. Disallowance of depreciation by adjusting the Written Down Value (WDV) of certain assets of the company - Held that:- The assessee has pointed out that in any case, such adjustment was carried out in the subsequent year. The Tribunal noted that in the later year, the assessee had suomoto made necessary adjustment and reduced its cost of depreciable asset. The Tribunal, therefore, held that there would be no revenue loss. The Tribunal, therefore, while accepting the assessee's contention, directed the Assessing Officer to verify necessary facts before granting relief. We do not find any reason to interfere. The Revenue does not dispute that the assessee had made adjustment in the claim of its depreciable asset in the later year. In the later year, the Revenue having accepted such adjustment, enforcing such adjustment in the present year also may amount to taxation the same income twice. In any case, the Tribunal recorded the issue is remained neutral. No question of law arises. - Revenue appeal dismissed.
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