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TMI Blog2020 (7) TMI 604X X X X Extracts X X X X X X X X Extracts X X X X ..... on 50B are attracted in computing the capital gains arising from transfer of API division as a going concern?" 3. The facts leading to this appeal are briefly stated as hereunder. The assessee filed return of income on 29.10.2007 for the assessment year 2007-08, admitting an income of Rs. 2,43,99,239/- and book profit under Section 115JB admitted is Rs. 30,52,48,255/-. The scrutiny assessment was undertaken and an order was passed under Section 143(3) on 31.12.2009 disallowing/adding among others, treating the sale of API division as a "slump sale" as against individual sale. During the previous year, relevant to the assessment year 2007-08, the assessee sold one of its divisions namely API division for a total sale consideration of Rs. 5,554.18 lakhs. According to the assessee the break-up of the consideration received is as hereunder:- Nature of Assets Rs. in Lakhs Furniture & Fixtures 34.00 Plant & Machinery 4340.99 Land 300.00 Building 425.00 Patent 0.01 Net Current Assets 454.18 Total 5554.18 4. The Assessing Officer issued show cause notice calling upon the assessee as to why the sale should not be treated as "slump Sale" and the profits arising out of suc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ue. 6. The short issue, which falls for consideration is whether the Tribunal was right in affirming the order passed by the Assessing Officer and holding that the transfer of the division is to be treated as a 'slump sale' and not sale of individual items and consequently, Section 50B of the Act was attracted. It is noteworthy to point out that when the assessee filed appeal before the CIT(A), the following grounds were raised:- "(b) The transfer of the Undertaking was done on individualized method and not on the basis of lump sum consideration. In other words, the consideration of Rs. 55.54 Crores was towards the following items as set out in the agreement. Particulars Amount (Rs. in Lacs) Furniture & Fixtures 34.00 Plant & Machinery 4340.99 Land 300.00 Building 425.00 Patent 0.01 Net Current Assets 454.18 Total 5554.18 (c) In terms of Clause 5.2(h) of the Business Purchase Agreement dated February 07, 2007, the Seller (i.e. Appellant) needs to deliver the Sale Bill covering all the Assets other than the freehold property to the buyer (i.e. M/s.Actavis Pharma Manufacturing Private Limited). Accordingly, the Appellant issued Sale Bill dated 08.02.2007 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... her in terms of Clause 5.2(c) of the BTA dated February 07, 2007, the Seller (ie the Appellant) needs to execute the Sale Deed in the agreed form for assignment of patents. The form was provided as Annexure - 11, to the agreement and this contained value of patents also. (This document was provided to me as Annexure 6 to paper book during the course of hearing). 6.1.17. Further as per Clause 5.2(c) of the BTA dated February 07, 2007, the Seller (ie Appellant) need to execute in favour of the Buyer, Sale Deed for the Conveyance, Assignment to Transfer of Freehold Property. The Value at which the Land and Building were transferred were: Rs. Land - 3,00,00,000 Building - 4,25,00,000 Total - 7,25,00,000 6.1.18. From the above document forming part of the BTA, it is clear that the Appellant has assigned separate values for immovables consisting of land and building and movables consisting of Furnitures and fixtures, Plant and Machinery, patents, Net current assets. Thus the consideration for transfer cannot be called as a lump sum consideration." 8. From the above finding, it is seen that the CIT(A) not only analysed the conditions contained in the agreement, but ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Tribunal ought to have noted that the Revenue never disputed the facts which were recorded by the CIT(A) showing that the individual assets were separately valued, though not specified in the agreement for sale. 9. It is the argument of Mr.J.Narayanaswami, the learned Senior Standing Counsel that if the Tribunal had failed to do so then, it is a fact finding exercise and at best, the matter needs to be remanded for a fresh exercise. 10. In our considered view, the substantials question of law framed for consideration in this appeal undoubtedly are mixed questions of fact and law. If there is a perversity in the approach of the authorities or the lower forum with regard to the factual aspect, if the authorities failed to take note of important evidence placed by the assessee or if there is misinterpretation of such important evidence, then, as an appellate court, such error can be corrected, as it is an error of law and not an error of fact. The question of remanding the matter to the Tribunal for fresh consideration would not arise for the simple reason that the fact that the individual assets were separately valued as recorded by the CIT(A) was never disputed by the Revenue b ..... X X X X Extracts X X X X X X X X Extracts X X X X
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