TMI Blog2017 (10) TMI 582X X X X Extracts X X X X X X X X Extracts X X X X ..... ee while filing the revised return of income has claimed depreciation on the consolidated block of assets and thereby the claim of depreciation was reduced after giving effect to the transfer of the asset in question. Therefore though the transfer of block of assets by the erstwhile entity Makino Asia Pte Limited had resulted STCG in the hand of the said entity but it exists only so long there was no merger/amalgamation. Once the merger / amalgamation was effected from 1.4.2002 ail the transactions thereafter would be treated as transactions of the new entity post amalgamation. Thus when there is no extinguishment of block of assets of plant and machinery in the hand of the assessee then the transfer of assets in question after 1.4.2002 wou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Branch (amalgamating company) during the year is to be considered as assets purchased by the appellant and: .that the same would not result in extinguishment of the block and Therefore, the short term capital gains would not arise as such to the appellant. 1.2 The learned CIT (A) consequently erred in reducing the short term, capital gains against the business loss shown by the appellant The Appellant craves leave to add, to alter or amend all or any of the aforestated grounds of appeal. For the above and any other grounds which may be revised at the time of hearing, it is prayed that the order of the learned CIT (A) be set aside. 3. The only issue arises in this appeal of the assessee is regarding the enhancement of assessme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssued a show cause for enhancing the assessment by an amount of ₹ 29,95,570 being STCG under Section 50(1) which was originally offered in case of Makino Asia Pte Ltd, The CIT (Appeals) was of the view that since the said company Makino Asia Pte Ltd. sold its block of assets and earned STCG of ₹ 29,95,570 which was also offered by the said company to tax therefore post amalgamation / merger the assessee is also required to offer the STCG under Section 50(1) of the Act as the firm company is now become the capital gain of the assessee. 4. Before us, the assessee contended that the addition in the block of assets plant and machinery were greater than the sale proceedings from the sale of asset by Makino Singapore Pte Ltd.. ther ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ied upon the impugned order. 6. We have considered the rival submissions as well as the relevant material on record. There is no dispute that Makino Asia Pte Limited and Makino Machine Tools India Pvt. Ltd. got merged w.e.f. 1.4.2002 as per the order dt.19.12.2013 of Hon'ble jurisdictional High Court approving the scheme of amalgamation. Post amalgamation the assessee filed a revised return on the basis of consolidated accounts of the amalgamated companies. The dispute is regarding the STCG arising in the hand of Makio Asia Pte Limited on account of sale of block of assets (plant and machinery) which was also offered to tax by the said company in the original return of income filed prior to the approval of the scheme of amalgamation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was still having balance in the block of assets of plant and machinery. Therefore the conditions as stipulated under Section 50 of the Act have not been satisfied so that any capital gain arising in the hand of the assessee can be deemed as per the provisions of Section 50 of the Act. It is also not in dispute that the assessee while filing the revised return of income has claimed depreciation on the consolidated block of assets and thereby the claim of depreciation was reduced after giving effect to the transfer of the asset in question. Therefore though the transfer of block of assets by the erstwhile entity Makino Asia Pte Limited had resulted STCG in the hand of the said entity but it exists only so long there was no merger/amalgamatio ..... X X X X Extracts X X X X X X X X Extracts X X X X
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