The Delhi Bench of Income Tax Appellate Tribunal (ITAT) has upheld the addition of capital gain on slump sale of sugar unit on failure to furnish purchaser company confirmation and documentary evidence on conveyance deed.
The assessee, Sir Shadilal Enterprises Limited had filed appeal holding that the Commissioner of Income Tax Appeals (CIT (A)) had in dismissing the appeal against the order of assessing officer as adequate opportunity of being heard was not provided to the appellant. The Order passed by the CIT(A) was arbitrary, bad in law and in violation of rudimentary principles of contemporary jurisprudence.
I.P. Bansal, on behalf of the assessee contended that the order CIT (A), passed merely on surmises and conjecture should be reversed. He vehemently submitted that the CIT (A) erred in law and on facts in dismissing the appeal against the order of assessing officer and confirming the addition in long term capital gain of slump sale of unit of Sugar Mill on highly presumption basis.
From the ledger account of the other party filed on record by the appellant, the authorities below could not appreciate the transactions mentioned in the ledger account and simply on the basis of credit entries appeared therein, addition of long-term capital gain on slump sale was made. Even authorities below could not appreciate that the short-term capital gain on mutual funds were not belonging to a unit under consideration for slump sale purposes and included in above additions.
T. James Singson, on behalf of the revenue submitted that the Assessing Officer had issued notice under Section 133(6) of the Income Tax Act to the purchaser company Superior Foods Pvt. Ltd but the said notice was never complied by the purchaser company. He further contended that the assessee responded the notices issued by the Assessing Officer and the Assessing Officer found that in the conveyance deed executed by the assessee in favour of assessee company, as reproduced by the Assessing Officer in the assessment order clearly revealed that the assessee itself had shown sale consideration of Rs. 75.50 crores and not Rs. 70 crores have claimed by the assessee.
The two-member Bench of Chandra Mohan Garg, (Judicial Member) and M. Balaganesh, (Accountant Member) dismissed the appeal filed by the assessee observing that the appellate had failed to furnish confirmation from the purchaser company and the documentary evidence particularly conveyance deed dated 08.09.2014 clearly revealed that the assessee received sale consideration of Rs. 75.50 crores in four instalments through banking channels from the purchaser company and therefore there was no reason to interfere with the findings of Assessing Officer making impugned addition to the capital gain income of assessee.
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