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TMI Blog1990 (11) TMI 349X X X X Extracts X X X X X X X X Extracts X X X X ..... al deleting a turnover of Rs. 6,29,700 from assessment for the assessment year 1977-78 on the ground that it is the turnover coming under rule 6(d) of the Tamil Nadu General Sales Tax Rules (hereinafter referred to as "the Rules"). The said rule provides that in determining the taxable turnover, amounts realised by a dealer by sale of his business as a whole shall be deducted from the total turnov ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pellant's case, we find, that the appellants have taken steps to enter into collaboration agreement with M/s. Chicago Pneumatic Tool Company Ltd., of U.S.A., for which it has become necessary to initially float a private limited company to be a wholly owned subsidiary company of the appellants. Accordingly in the meeting of the Board of Directors of the appellants' company on March 19, 1977, a res ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ependent unit by itself, was sold, rule 6(d) of the Rules could be applied. In the decision in State of Tamil Nadu v. Thermo Electrics [1977] 39 STC 317 (Mad.) also it was reiterated that rule 6(d) contemplates transfer of the business as a going concern and not as a transfer of assets alone. 2.. In answer to another question that was posed by one of us, namely, whether the above transaction woul ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f fully-paid shares in consideration of passing of title in the goods as in the present case. The learned counsel referred to a decision of the Supreme Court in Devi Dass Gopal Krishnan v. State of Punjab [1967] 20 STC 430. In that case, the Supreme Court did not lay down that if there is a transfer of goods for valuable consideration, other than cash, the transaction cannot be regarded as sale. W ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ld as equivalent, or akin, to cash and cannot be treated as a mere exchange or barter." In the present case also, the shares given in lieu of the plant and machinery, etc., are to be taken as "cancellation of one debt by another", as held in the abovesaid [1984] 55 STC 371 (Mad.) (Premier Electro Mechanical Fabricators v. State of Tamil Nadu). 3.. Therefore, this tax revision case is allowed and ..... X X X X Extracts X X X X X X X X Extracts X X X X
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