TMI Blog2015 (11) TMI 1215X X X X Extracts X X X X X X X X Extracts X X X X ..... ing to the Assessee, its board of directors decided to retain the said shares on long term basis and consequently passed a resolution on 4th April, 1991 that the shares held by it be treated as investment/capital. The AO held that the funds received from sale of shares had been transferred to related companies within the group. The AO further held that the transaction of renunciation of rights were a sham transactions and a device to purchase notional losses. At the outset, the learned counsel for the parties submitted that the material facts and issues in the present appeal were similar to the issues involved in Commissioner of Income Tax Delhi-I v. M/s Abhinandan Investment Ltd. - Decided in favour of the Revenue and against the Ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed the relevant facts necessary to address the present appeal are as under:- 3.1 The Assessee company is an investment company belonging to the Jindal Group of companies. Jindal Group is mainly engaged in the manufacturing and production of ferrous metals and alloys. Jindal Group includes investment companies such as the Assessee which, inter alia, hold and deal in shares of the operational companies of the group. The Assessee furnished the return of Income for the assessment year 1992-93 (Previous year ending 31st March, 1992) declaring an income of ₹ 25,37,330/- and claimed a carry forward of short term capital loss of ₹ 1,41,73,760/- to be set off against future capital gains. 3.2 The Assessee claimed that it has su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... JISCO was ₹ 625/- and ex right price was ₹ 425/-. On the aforesaid basis, the Assessee claimed that cost of acqusition of rights to subscribe to PCD was the dimunition in value of the share holding in JSL and JISCO computed at ₹ 140/- per share of JSL and ₹ 200 per share of JISCO. After accounting for the sale consideration for renunciation of rights to subscribe the PCDs, the Assessee claimed that it had suffered a loss of ₹ 79,56,000 on renunciation of PCDs of JSL and ₹ 1,77,77,500 on renunciation of PCDs of JISCO. After setting off the loss against the gains on sale of shares, the Assessee claimed a net loss of ₹ 1,41,73,760/- to be carried forward. 4. The Assessee had held the shares of JISC ..... X X X X Extracts X X X X X X X X Extracts X X X X
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