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TMI Blog2016 (12) TMI 1356X X X X Extracts X X X X X X X X Extracts X X X X ..... he business for three or more years. 3. The assessee in the present case is a Company, which is engaged in the business of manufacturing and exporting of leather goods and manufacturing of Pen Refills as well as trading of Pens. The return of income for the year under consideration was originally filed by it on 29.11.2006 declaring total income of Rs. 42,90,186/-. Subsequently a revised return was filed by the assessee on 04.12.2007 declaring total income at 'nil' and book profit under section 115JB of the Act at Rs. 1,23,86,308/-. As per the order of the Hon'ble High Court of Calcutta dated 06.07.2005, M/s. Surya Kiran Udyog Pvt. Ltd. (amalgamating company) was amalgamated with the assessee-company (amalgamated company) w.e.f. 01.04.2004. In the revised computation of total income done as per the normal provisions of the Act, the brought forward depreciation loss of the amalgamating company pertaining to A.Y. 2003-04 and 2004-05 amounting to Rs. 84,22,538/- was set off by the assessee-company against its income for the year under consideration. The claim of the assessee for such set off was examined by the Assessing Officer as per the relevant provisions of section 72 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssee and allowed the claim of the assessee for set off of unabsorbed depreciation loss of the amalgamating company against its income for the year under consideration. 5. The ld. D.R. contended that the effective date of amalgamation as approved by the Hon'ble High Court was 01.04.2004 and since the amalgamating company was incorporated only on 13.09.2001, the condition of being in the business for more than three years was certainly not satisfied. He contended that the date of receipt of order of the Hon'ble High Court or the date of filing the said order with the Registrar of Companies is not relevant for deciding the effective date of amalgamation and the ld. CIT(Appeals) is not justified to rely on the said date to hold that the condition of amalgamating company being engaged in the business for more than three years was duly satisfied. 6. The ld. counsel for the assessee, on the other hand, contended that the effective date of amalgamation was 01.04.2004 as approved in the order of the Hon'ble Calcutta High Court. He contended that the amalgamating company however was engaged in the business of manufacturing ball pen tips right from 13.10.2001 when the first paym ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is whether the condition stipulated in the relevant provisions that the amalgamating company should have been engaged in the business for three or more years is satisfied or not. The relevant provision as contained in sub-section 1 of section 72A in this regard is extracted below:- "The amalgamating company should be engaged in the business in which the accumulated loss occurred or depreciation remains unabsorbed, for three or more years". 8. The term used in the relevant provision thus is "three or more years" and not "three or more previous years". The definition of the previous year as given in sub-section 3 of the Act thus is not relevant in this context and the same, in our opinion, cannot be adopted as sought to be contended by the ld. counsel for the assessee. The word "year" no doubt is not defined either in the relevant provisions of section 72A of the Income Tax Act or anywhere else in the said Statute and in the absence of the same, one has to look into the meaning as assigned to the said word in the General Clauses Act. Section 3(66) of the General Clauses Act defines "year" to mean a Calendar Year reckoned according to the British Calendar. The General Clauses Act i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rted in 319 ITR 306 and in the case of CIT -vs.- Vinay Cement Limited reported in 213 CTR 268. Respectfully following the ratio laid down by the Hon'ble Supreme Court in these cases, we uphold the impugned order of the ld. CIT(Appeals) giving relief to the assessee on this issue and dismiss Ground No. 2 of the Revenue's appeal. 10. In the solitary ground raised in its cross Objection, the assessee-company has challenged the addition of Rs. 39,07,500/- made by the Assessing Officer and confirmed by the ld. CIT(Appeals) on account of short-term capital gain on sale of property by applying the provisions of section 50C of the Act. 11. In its return of income filed for the year under consideration, the assessee-company had declared short-term capital gain of Rs. 33,64,430/-on sale of property as worked out by reducing the cost of acquisition of Rs. 3,14,31,770/- from the sale consideration of Rs. 3,47,96,200/- as per the relevant sale deed. In this regard, it was noticed by the Assessing Officer that the value of the property sold by the assessee as adopted or assessed by the concerned authority of the State Government for the purpose of payment of stamp duty was Rs. 3,87,03, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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