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TMI Blog2003 (9) TMI 328X X X X Extracts X X X X X X X X Extracts X X X X ..... tal loss at Rs. 39,834. But the AO considered only the fair market value of the assets and did not accept the loss and ignored the claim of the assessee. The learned CIT(A) restored this issue for fresh examination with a direction that the AO should apply the ratio of a decision relied by the learned authorised representative in the case of CIT vs. Shivakami Co. (P) Ltd. (1986) 52 CTR (SC) 108 : (1986) 159 ITR 71 (SC). The AO found that the ratio of that decision referred to above was not applicable to the facts of this case and after applying the provisions of s. 45(4) of the IT Act, 1961 (hereinafter, referred to as the Act , for short), concluded that the fair market value of the assets in question on the date of transfer shall be deem ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s, for the first time, sought the application of s. 50(ii) of the Act, which are the special provisions for computation of capital gains in case of depreciable assets. Neither the AO ever applied the provisions of s. 50(ii) to the facts of this case, nor this issue was raised before learned CIT(A). So, in our opinion, the plea taken by the Department all of a sudden without any consideration on this issue having been made by the authorities below is misconceived and not tenable in the eyes of law. But to meet the ends of justice and for the sake of settling the issue in question for good, we would consider the application of the said provision of the Act to the facts of this case. 7. The undisputed facts are that the AOP was dissolved and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e section reveals that the estimation of fair market value of such assets is not required as per this section. Only WDV has to be considered and the sale price taken by the assessee recorded in the books of account can be considered for that matter. So, by taking the words in their ordinary meaning and ordinary placement, we are unable to accept the case of the Department. Rather, the ground of appeal taken by the Department contradicts its own case where the AO has arrived at the fair market value and not considered only WDV as required by this section. Generally, capital gains are worked out by deducting the cost price of the various assets from the fair market value as taken by the AO. So, in our opinion, the learned CIT(A) has done no w ..... X X X X Extracts X X X X X X X X Extracts X X X X
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