TMI Blog2015 (1) TMI 826X X X X Extracts X X X X X X X X Extracts X X X X ..... - TAX APPEAL NO. 9 of 2002 - - - Dated:- 11-12-2014 - MR. KS JHAVERI AND MR. K.J.THAKER, JJ. FOR THE PETITIONER: MR KM PARIKH, ADVOCATE FOR THE RESPONDENT : MRS SWATI SOPARKAR, ADVOCATE JUDGEMENT Per: K S Jhaveri: 1. By way of this appeal, the appellant-revenue has challenged the judgment and order dated 30.04.2001 passed by the Income Tax Appellate Tribunal, Ahmedabad [for short the Tribunal ] in ITA No.3332/Ahd/1995, whereby the appeal filed by the revenue was partly allowed by the Tribunal. 2. The facts of this case are that the assessee had filed its return for the assessment Year 1990-91 on 3.12.1990 and declared a loss of ₹ 5,16,758/-. A revised return was also filed by the assessee on 31.0-3.19902 at a total income of ₹ 46,25,360/-. Thereafter, the return was processed and the Assessing Officer passed his order on 30.03.1993. Against the order of the Assessing Officer, the assessee filed an appeal before the Commissioner of Income Tax (Appeals). The CIT (A) vide order dated 26.07.1993 partly allowed the appeal of the assessee. Being aggrieved by the order of the CIT(A), the revenue filed an appeal before the Tribunal. The Tribunal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the impugned order of the Tribunal. 5.1. Learned advocate for the respondent has drawn our attention to Section 79 of the Income Tax Act and submitted that in view of the aforesaid section and in view of the observations made by the CIT(A) in its order, no interference is required to be called for by this Court in the impugned order of the Tribunal. He, therefore, urged that this Court may answer the question No.1 in favour of the assesseee. 5.2. So far as the question No.2 is concerned, learned advocate for the respondent has submitted that the same is already concluded by the Apex Court in favour of the revenue and against the assessee in the case of Commissioner of Income Tax v. Shirke Construction Equipment Ltd. reported in [2007] 291 ITR 380 (SC). 6. We have heard learned advocates for the parties and perused the material on record. Before dealing with the contentions, it would be relevant to reproduce Section 79 of the Income Tax Act, which reads as under:- Section 79 Notwithstanding anything contained in this Chapter, where a change in shareholding has taken place in a previous year in the case of a company carrying not being a company in which the public a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t it is necessary for me to mention that I do not find the relevance of this decision in this case at all. The law has long been changed after this decision has been rendered. In this case, the main issue to be decided was whether in that instant case the change is shareholding was done with a view to avoid tax (originally subsection (b) of section 79. With the withdrawal of clause (b) with effect from 1.4.89 the ratio of this decision is not useful to any of the cases for all A.Y. Subsequent to A.Y. 89-90. The case of the assessee in that case was that the assessee fell within the exception carved out by provisions of clause (b) of section 79. However, I do not seek to apply the ratio strictly as the assessee in the above referred case had not argued the issue which is sought to be contested by the appellant in this case. The appellant has also relied on the decision of the Bombay High Court in the case of Brooke Bond India Ltd. Vs. Dinkar Landge 56 Com Cases 1. In this it has been held that a period does not case get the rights of a member during the pendency of the petition of amalgamation, even though the proposed scheme of amalgamation is within the retrospective effect. The a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Chemicals Pvt. Ltd. held was the beneficial interest in the assets of the appellant company and not in the shares of the appellant company. For holding beneficial interest into any asset it is necessary that the asset must be in existence, if the asset is not existing the question of holding beneficial interest in the said asset do not arise. 3.5. On perusal of the Scheme of Amalgamation as approved by the Bombay High Court some interesting reasons come to the light. In paras 2,3,4,6 and 7 the reference is made to the appointed date, which is 1st April, 1989. It has been mentioned in these paras that on the approval of the said scheme the assets, rights, obligations, profits and losses of the amalgamating company will belong to or vest in the appellant company with effect from the appointed date. However, reading para 9 (relied upon also by the A.O.) the reference is made to the Scheme becoming effective and not with effect from the date, in which , the procedural formalities as prescribed under the Companies Act, 1956 is completed. These formalities are mentioned in para 15 of the Scheme of Amalgamation which includes the approval of the High Court. Sub Section (3) of Section 391 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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