2019 (5) TMI 559

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..... e ground that at the end of the period of 18 months, the warrant had become valueless and that, therefore, there is no transfer of capital asset - HELD THAT:- We notice that in the case of Deputy Commissioner of Income Tax Vs. BPL Sanyo Finance Ltd. [ 2008 (2) TMI 386 - KARNATAKA HIGH COURT] under similar circumstances, had held that the loss suffered by the Assessee on forfeiture of its righ .....

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..... 2. The following question is presented for our consideration. Whether on the facts and in circumstances of the case and in law, the ITAT was justified in deleting the disallowance of short term capital loss of ₹ 14,40,00,000/made by the Assessing Officer in view of provisions of Section 2(14) and 2(42) of the Income Tax Act, 1961 ? 3. The Respondent Assessee is an i .....

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..... valueless and that, therefore, there is no transfer of capital asset. 5. The CIT (Appeals) and the Tribunal allowed the Assessee's claim relying on the decision of Karnataka High Court and Delhi High Court. 6. We notice that Karnataka High Court, in the case of Deputy Commissioner of Income Tax Vs. BPL Sanyo Finance Ltd. [2009] 312 ITR 63 (Karn), under similar circumst .....

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..... s so on two grounds. First of all, the question of whether forfeiture amounted to transfer, was not at all raised before the authorities below and in view of the decision of this Court in Indo-count Finance Ltd. [2004] 271 ITR 215 , we cannot permit the Revenue to take up this issue for the first time before this Court. 13. More importantly, the second issue as to whether the forfeitur .....

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..... extinguishment of the right of the assessee to obtain a share in BLB Ltd. It is not a case where the asset itself has been extinguished or destroyed. A share in a company is nothing but a share in the ownership of the company. While the right of the assessee to share in the ownership of the company (BLB Ltd.) stands extinguished on account of the forfeiture, the company, with all its assets, conti .....

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