COMMISSIONER OF INCOME TAX DELHI II vs. MEDICARE INVESTMENTS LTD.

ITA - 840 / 2008HC Delhi20 March 201537 pages
For Petitioner: ROHIT MADAN
AI SummaryDismissed

What did the High Court hold?

The Tribunal held that the assessees suffered a business loss on the sale of NCDs and warrants, and this loss constituted an allowable deduction. The arrangement with UTI was not considered a colorable device to avoid tax.

What were the facts?

Assessees, shareholders of JISCO, subscribed to a rights issue of Non-Convertible Debentures (NCDs) with detachable warrants. An arrangement with UTI allowed assessees to surrender NCDs to UTI, which paid the balance allotment money, and assessees received the warrants. Assessees claimed a loss on the transaction.

What were the issues?

Whether the loss claimed by the assessees on the transaction involving NCDs and detachable warrants is a genuine business loss and allowable as a deduction.

Which sections of the Income-tax Act were involved?

Section 37

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Cases cited in this judgment(6)Show list

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ITA Nos.25/01, 840/08 & 26/01 Page 1

$~ * IN THE HIGH COURT OF DELHI AT NEW DELHI

RESERVED ON: 26.02.2015 %

PRONOUNCED ON: 20.03.2015

+ ITA 25/2001

COMMISSIONER OF INCOME TAX

..... Appellant

versus

M/S. ABHINANDAN INVESTMENT LTD. ..... Respondent

ITA 840/2008

COMMISSIONER OF INCOME TAX DELHI II ..... Appellant

versus

MEDICARE INVESTMENTS LTD.

..... Respondent

ITA 26/2001

COMMISSIONER OF INCOME TAX

..... Appellant

versus

JINDAL EQUIPMENTS LEASING & CONS. SERV. .... Respondent Through : Sh. Rohit Madan, Sh. P. Roychaudhuri and Sh. Ruchir Bhatia, Advocates, for the Revenue.

Sh. Ajay Vohra, Sr. Advocate with Ms. Kavita Jha, Adv. for assessees.

CORAM: HON'BLE MR. JUSTICE S. RAVINDRA BHAT HON'BLE MR. JUSTICE R.K. GAUBA S.RAVINDRA BHAT, J. (OPEN COURT)

1.

These three appeals involve common questions of law directed against a common order of the Income Tax Appellate Tribunal (ITAT) dated 05.06.2000. Initially, a Division Bench had decided the case on, 08.10.2001, reported in (2002) 254 ITR 0538 (C

The order continues below.

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