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2016 (12) TMI 356 - HC - Income TaxSIC company - Benefit of exemption from Capital Gains Tax - granting extension of the time for set off the carry forward losses - whether claim can be denied to an undertaking sought to be revived by the BIFR - Held that:- There is no denial of the fact that the company has shown profitability. Its liability to redeem the preference shares is in the future. In the circumstances, the possibility of its incurring losses in the event of payment of capital gains tax cannot be ruled out. That such losses might arise could also be within the normal course of any normal business enterprise’s functioning. In the circumstances, the view of the respondents that exemption from payment of capital gains tax is not warranted cannot be held illegal. The Court is aware, at the same time that in the assessments completed till date, the petitioner’s liability had not in one sense been crystallized. The remand to the income tax authorities on three occasions led to fresh orders based upon fresh assessment of the facts and circumstances on each occasion. Having regard to these peculiar facts, a direction is issued to the respondents not to charge interest or penalty on the capital gains tax amounts in the circumstances of the case for the duration that the matter remained pending in these proceedings and all prior proceedings. The writ petition is allowed in terms of the directions in the preceding paragraph even while upholding the liability to pay capital gains tax.
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