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2020 (12) TMI 592 - AT - Income TaxCapital gain - Capital asset u/s 2(14) - share application money as transferred / assigned by the assessee - whether it would constitute a ‘Capital Asset’ within the meaning of Sec.2(14)? - whether loan given to its subsidiary in India, by the foreign company constitute capital asset? - HELD THAT:- As decided in Siemens Nixdorf Information Systems Gmbh Siemens Nixdorf Information Systems Gmbh [2019 (9) TMI 199 - BOMBAY HIGH COURT] wherein held Tribunal has considered the meaning of the word ‘property’ as given in the context of the definition of asset in the Wealth Tax Act to hold ‘property’ to include the every interest which a person can enjoy. This was extended by the Tribunal to understand the meaning of the word ‘property’ as found in the context of capital asset under Section 2(14). Revenue has not been able to point out any reasons to understand meaning of the word ‘property’ as given in the Section 2(14) of the Act differently from the meaning given to it under Section 2(e) of the Wealth Tax Act, 1957. The Revenue has not been able to point out why the above decision of this Court rendered in the context of capital assets as defined in Section 2(14) of the Act, is inapplicable to the present facts. Nor, why the loan given to M/s. SNISL would not, in the present facts, be covered by the meaning of ‘capital asset’ as given under Section 2(14) of the Act. As the issue raised herein stands concluded by the decision of this Court in M/s. Bafna Charitable Trust [1997 (9) TMI 93 - BOMBAY HIGH COURT] and also by the self evident position as found in Section 2(14) of the Act, the question as framed does not give rise to any substantial question of law. The share application money is nothing but mere advances till the time the shares are allotted and share application money is converted into share capital. This is further fortified by the fact that the provisions of The Companies Act provide for refund of share application money with interest under certain circumstances. Thus we hold that the share application money as transferred / assigned by the assessee would constitute a ‘Capital Asset’ within the meaning of Sec.2(14) of the Act. It does not fall under any of the exclusions. Consequently, the resultant losses would be allowable to the assessee - Decided against revenue.
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