« From the Courts » Open DEMAT Account in 24 hrs  Karnataka High Court restrains Bengaluru-based Institute of Chartered Tax Practitioners India from enrolling candidates for its courses  Attachment on Cash Credit of Assessee under GST Act: Delhi HC directs Bank to Comply Instructions to Vacate  Income Tax Addition Made Towards Unsubstantiated Share Capital Is Eligible For Section 80-IC Deduction: Delhi High Court  Inordinate delay in income tax appeal hearings  Income Tax leviable on Tuition Fee in the Year of Rendering of Services: ITAT  Supreme Court invoked its power under Article 142 of Constitution to validate notices issued under section 148 as notices issued under section 148A. However the same shall be subject to amended provisions of section 149.  ITAT refuses to stay tax demand on former owner of Raw Pressery brand  Bombay HC sets aside rejection of refund claims by GST authorities  [Income Tax Act] Faceless Assessment Scheme does not take away right to personal hearing: Delhi High Court  Rajasthan High Court directs GST Authority to Unblock Input Tax Credit availed in Electronic Credit Ledger  Sebi-taxman fight over service tax dues reaches Supreme Court «  SC upholds decision to disband 1,734 fast track courts... Ghanshyam K. Khabrani vs. ACIT (Bombay High Court)... » SREI Infrastructure Finance Ltd vs. ITSC (Delhi High Court) April, 19th 2012 S. 50B: Slump Sale Need Not Be A Sale. All Slump Transfers Are Covered   The assessee entered into a scheme of arrangement u/s 391-394 of the Companies Act, 1956 pursuant to which it transferred its project finance business and assets based financing business to another company for a lumpsum consideration of Rs. 375 lakhs. The assessee filed a settlement application in which it claimed that the said consideration on transfer of the project finance business was not chargeable to tax as it was not by way of sale and there was no cost of acquisition for the same. However, the Settlement Commission that the said transfer, though effected through an order of the Court was a slump sale and was chargeable to tax u/s 50B. The assessee filed a Writ Petition to challenge the Settlement Commissions order. HELD by the High Court dismissing the Petition: The assessees argument that a transfer under a scheme of arrangement u/s 391-394 of the Companies Act is not a slump sale for purposes of s. 50B is not acceptable. S. 50B was inserted to supercede decisions which held that a slump sale (i.e. transfer of business as a going concern) was not taxable for want of cost of acquisition. The term slump sale is defined in s. 2(42C) to mean the transfer of an undertaking as a result of a sale. The use of the word transfer in s. 2(42C) is significant and any type of transfer which is in nature of slump sale i.e. when lump sum consideration is paid without values being assigned to individual assets and liabilities is covered by s. 2(42C) and s. 50B. This is the reasonable, plausible and natural grammatical meaning which has to be given to the definition of slump sale. It is not correct to construe the word slump sale to mean that it applies to sale in a narrow sense and as an antithesis to the word transfer as used in s. 2(47). The intention of the legislature was to plug in the gap and tax slump sales and not to leave them out of the tax net. The term slump sale has been used in the enactment to describe a particular and specific type of transfers called slump sales. The use of the word sale in the term slump sale does not narrow down the concept of transfer as defined and understood in s. 2(47). All transfers in the nature of sales i.e. slump sales are covered by s. 2 (42C).