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2010 (12) TMI 724 - AT - Income TaxDeduction u/s 10B - Acquisition and conversion of partnership firm into company - whether business can be assigned retrospectively by one firm to another firm for the purpose of claiming deduction under section 10B. - transfer of business or merger - Held that:- The first objection raised by the Assessing Officer is that the sale proceeds were not received by the assessee as they were received by M/s. Anjali Exports, in this regard we would like to mention that by a memorandum of understanding dated January 15, 2007 the business of M/s. Anjali Exports have been taken over retrospectively with effect from April 1, 2006. Whatever the sales made by M/s. Anjali Exports, the payment against those sales has to come in the name of M/s. Anjali Exports. The bank account in the name of M/s. Anjali Exports is not closed and the same is deposited in the bank account of M/s. Anjali Exports which has been taken over by the assessee. Therefore, whatever the sale proceeds are received, that has to be treated as received by the assessee for the reason that on account of slump sales entire business including turnover have been taken over by the assessee-firm with effect from April 1, 2006. - technicality should not come into substantial justice of the assessee which otherwise is eligible for deduction under section 10B. - decided in favor of assessee.
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