Amalgamation taking place retrospectively before transfer of assets to amalgamated company by amalgamating company, No capital gains u/s 50 arise in hands of amalgamating co.

Para 6“…………..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 (vide High Court order dated 19-12-2003)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 would not result in deemed capital gain under Section 50 of IT Act. “


Hence with drawl of income offered for STCG pre amalgamation through revised return was held valid by ITAT Banglore Bench in Makino India (P.) Ltd. [2017] 86 139 (Bangalore – Trib.)

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