The Commissioner vs. M/S Siel Financial Services Ltd

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ITA/209/2012HC Madhya Pradesh10 January 2014Bench: HON'BLE SHRI JUSTICE AJIT SINGH1 pages
For Petitioner: Sanjay Lal
AI SummaryDismissed

What did the High Court hold?

The Tribunal dismissed the appeal summarily, finding that it did not involve any substantial question of law. The Tribunal upheld the concurrent findings of the Commissioner of Income Tax (Appeals) and itself, which had held that the respondent was eligible to carry forward and set off unabsorbed losses and unabsorbed depreciation of Sriram Agro Tech Industries Limited. This decision was based on the Delhi High Court's approval of the scheme of amalgamation and the Madras High Court's ruling in the case of Pentamedia Graphics Limited v. ITO. The appellant's counsel was unable to demonstrate any illegality in these findings. The ratio decidendi is that where a scheme of amalgamation is approved by a High Court, the successor entity is eligible to carry forward and set off the unabsorbed losses and depreciation of the amalgamating entity, provided there is no substantial question of law to the contrary.

What were the facts?

This appeal, filed under Section 260-A of the Income Tax Act, 1961, is directed against an order dated May 28, 2012, passed by the Income Tax Appellate Tribunal, Indore Bench. The Tribunal had dismissed the appellant's appeal, thereby confirming an order dated November 3, 2010, passed by the Commissioner of Income Tax (Appeals). The core of the dispute concerns the eligibility of the respondent to carry forward and set off unabsorbed losses and unabsorbed depreciation of Sriram Agro Tech Industries Limited for the year under consideration and subsequent assessment years. Both the Commissioner and the Tribunal, relying on a scheme of amalgamation approved by the Delhi High Court and an order from the Madras High Court in the case of Pentamedia Graphics Limited v. ITO, held the respondent eligible.

What were the issues?

1. Whether the respondent was eligible to carry forward and set off unabsorbed losses and unabsorbed depreciation of Sriram Agro Tech Industries Limited for the year under consideration and subsequent assessment years, considering the scheme of amalgamation. Assessee's Contention: The appellant argued that the respondent was not eligible to carry forward and set off unabsorbed losses and unabsorbed depreciation of Sriram Agro Tech Industries Limited. The appellant's counsel could not point out any illegality in the concurrent findings of the lower authorities. Revenue's Contention: The judgment does not record any specific arguments made by the revenue. However, the Commissioner and the Tribunal, in their orders, held that the respondent was eligible for carrying forward and set off unabsorbed losses and unabsorbed depreciation, relying on the Delhi High Court's approval of the amalgamation scheme and the Madras High Court's decision in Pentamedia Graphics Limited v. ITO.

Which sections of the Income-tax Act were involved?

Section 260-A

AI-generated summary — verify with the full judgment below

ITA No.209/2012 10.1.2014

Shri Sanjay Lal, Advocate, for the appellant.

Heard on admission.

This appeal, under section 260-A of the Income Tax Act 1961 (in short, “the Act”), is directed against the order dated 28.5.2012 passed by the Income Tax Appellate Tribunal, Indore Bench (in short, “the Tribunal”) whereby it has dismissed the appellant’s appeal and confirmed the order dated 3.11.2010 as passed by the Commissioner of Income Tax (Appeals).

The main submission of appellant is that the respondent was not eligible to carry forward and set off unabsorbed losses and unabsorbed depreciation of Sriram Agro Tech Industries Limited of the year under consideration and also in the subsequent assessment years. The Commissioner as well the Tribunal, having regard to the fact that the Delhi High Court has approved the scheme of amalgamation as well as the order of the Madras High Court in an identical case of Pentamedia Graphics Limited v. ITO 43 DTR 256 have held that the respondent was eligible for carrying forward and set off unabsorbed losses and unabsorbed depreciation of Sriram Agro Tech Industries Limited. The learned counsel for appellant could not point out any illegality in the concurrent findings of Commissioner and the Tribunal which are well-founded and unassailable. The appeal does not involve any substantial question of law. It is accordingly dismissed summarily.

(AJIT SINGH)

(SUBHASH KAKADE) JUDGE

JUDGE

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