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2023 (1) TMI 524 - AT - Income TaxRevision u/s 263 - computation of gain on slump sale - CIT directing the AO to treat the negative net worth for the purpose of computation of capital gains arising out of slum sale of Medical Ventilator Division of assessee company, as the assessment framed is erroneous and prejudicial to the interest of Revenue - HELD THAT:- Admittedly the slump sale consideration declared by assessee is ‘0’ i.e., ‘nil’ and admittedly there is negative net worth because the assessee had incurred loss continuously. The negative net worth is Rs.1,82,93,317/- and even if we reduce this from the slump sale consideration of zero, the ultimate capital gain will be zero. Hence, we are of the view that the revision passed by PCIT is right to the extent that negative net worth is to be considered while computing capital gains but in case of positive consideration. In the present case, the slump sale value is zero and hence, computation will fail and secondly, there is no prejudice caused to the Revenue by the order of the AO. Hence, the revision order passed by PCIT has not fulfilled the two condi tions which the Revenue itself admitted in its written submissions as under:- “2. To invoke the powers under 263 the twin conditions to be met are (i) the order of AO is erroneous and (ii) the order is prejudicial to the interests of revenue.” Once the second condition of prejudice caused to Revenue is not fulfilled, the revision order has to fail. We quash the revision order and allow the appeal of assessee.
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