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2018 (2) TMI 771 - AAR - Income TaxEntitlement to benefit of proviso to Section 112 (1) - tax payable on the long term capital gains arising on the sale of equity shares of Hero Honda Motors Ltd. - benefit of indexation under Second proviso to Section 48 - Held that:- The benefit of the proviso of Section 112(1) of the Act is applicable in the case of non-resident as well,in spite of section 48. This issue is identical to the above case and the decision in Cairn UK [2013 (10) TMI 430 - DELHI HIGH COURT] is squarely applicable. Following the above decision we conclude that the benefit under Section 112(1) of the Act could not be denied to the Applicant. We have been following this line in several cases and more recently in the case of Pan-Asia iGate Solutions, Mauritius, In Re [2014 (5) TMI 631 - AUTHORITY FOR ADVANCE RULINGS]. Claim deduction for expenses claimed as incurred in connection with the transfer of shares of HHML, as per provisions of section 48 - Held that:- Words “wholly and exclusively” do not connote “necessarily”. If the expenses have been incurred in connection with the transfer, they are to be allowed. The words “in connection with” are of wide import and if such expenses have an intimate connection with the transfer, they have to be allowed u/s 48. In the instant case there is no doubt that the expenses are incurred for effecting the transfer only. Even if it was a mutual decision of the two parties for their convenience, that the shares should be dematerialized and an Escrow account be opened, as contended by the Revenue, this in no way suggests that the expense were not incurred wholly and exclusively in connection with the transfer of shares. During the course of the final hearing, the Revenue has not opposed the Applicant’s contentions on the issue. Hence, the same are to be treated as allowable as a deduction under section 48 of the Act. - Appeal Decided in favour of assessee
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