TMI Blog2021 (12) TMI 143X X X X Extracts X X X X X X X X Extracts X X X X ..... against the order dated 8th March, 2017 passed by the Income Tax Appellate Tribunal, B Bench, Kolkata in ITA No. 1829/Kol/2013 for the assessment year 2006-07, ITA No. 2121/Kol/2013 for the assessment year 2006-07, ITA No. 1830/Kol/2013 for the assessment year 2007-08 and ITA No. 2122/Kol/2013 for the assessment year 2007-08. The appellant revenue has framed the following substantial question of law for consideration:- Whether on the facts and in the circumstances of the case the Learned Income Tax Appellate Tribunal, B Bench, Kolkata has erred in law in deleting the disallowance of sum of ₹ 3.50 Crores and ₹ 2.11 Crores for the assessment year 2006-07 and 2007-08 respectively on account of slump sale of chemical undert ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... an as is where is basis. It held that the transfer was genuine, although it was by a holding to a subsidiary company. The objection of the Revenue was with regard to excluded assets mentioned in the agreement. They were described in the said agreement as follows:-- (f) Excluded Assets means-- (a) cash in bank, cheques deposited in bank account and other unrealized cheques of ICI. (b) all unpaid and outstanding insurance claims pertaining to the Fertilizer Business as at the Transfer Date; (c) all other assets whether tangible or intangible pertaining exclusively to ICI's various business other than the Fertilizer Business . 12. The Revenue contended that since these assets were left out, it was not a sal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at the transaction was a slump sale and that it fell under section 45 of the said Act and further that for determining the capital gain from the full value of the consideration, the cost of acquisition of assets as well as the cost of any improvement were to be deducted. Since the cost of acquisition of intangible assets could not be determined the income was not chargeable to capital gains tax. It upheld the order of the CIT (Appeals). 15. This concept of slump sale was discussed in CIT v. Mugneeram Bangur Co. [1965] 57 ITR 299 (SC). At this stage it is quite important to appreciate the ratio of CIT v. Artex Manufacturing Co. [1997] 93 Taxman 357/227 ITR 260 (SC). The written down value of the plant, machinery and dead stock accordi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... x Act, 1961. The assessee contended that it was not possible to allocate the full value of the consideration of ₹ 10.20 crores amongst various assets of the undertaking. Consequently, and became the assets including intangible assets like gradually value of licences, manpower etc. could not be determined, the cost of acquisition and cost of improvement could not be determined. Since this could not be done the charging Section 45 of the said Act for computation of capital gains did not apply. Hence, it was not possible to compute capital gains. Therefore, ₹ 10.20 crores was not taxable under section 45 of the said Act. This submission was upheld by the court. 19. Mr. Justice Kapadia delivering the judgment and referring to M ..... X X X X Extracts X X X X X X X X Extracts X X X X
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