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TMI Blog2019 (6) TMI 1097X X X X Extracts X X X X X X X X Extracts X X X X ..... knowledge of sale of shares of M/s.Bush Boake Allen India Ltd., because sale of PCL shares took place even before grant of permission by the Government of India to M/s.Bush Boake Allen Ltd. Tribunal agreed with the contention of the assessee that the assessee was not a party or had influence in the decision taken by the M/s.Bush Boake Allen India Ltd., for the purchase of shares. Furthermore, on facts, the Tribunal found that the transaction is neither fraudulent nor a colourable device. Ultimately, the Tribunal held that when the transaction is within the parameters of law, then the Income Tax Authorities cannot enter into the shoe of the assessee to decide the prudence of commercial expediency of a particular transaction. With the abo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... acts and circumstances of the case, the Tribunal was right in holding that the capital loss arising out of sale of shares to sister concern when the transaction for sale to an outside buyer for a much higher price is being processed is genuine and ought to be allowed? 3. We have heard Mrs.R.Hemalatha, learned Senior Standing Counsel for the Revenue and M.P.Senthil Kumar, learned counsel for the assessee. 4. The respondent/assessee merged with EID Parry India Ltd., during the relevant previous year. It is stated by the Revenue that after entering into negotiations with M/s.Bush Boake Allen Ltd., for sale of shares of Parry Confectionery Ltd.,(PCL) which is another Company of the same group and pending Gover ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... orate consideration has been given by the CIT(Appeals) with regard to the disallowance of the claim of long term capital loss. At this juncture, it would be relevant to take note of the findings recorded by the CIT(Appeals) in paragraph 4.5.3 of its order dated 25.09.2007. After examining the factual aspects, the CIT(Appeals) held that the Assessing Officer's conclusion that the assessee company became aware of the sale of shares of M/s. Bush Boake Allen Ltd., to purchase its shares from the existing shareholders is incorrect. Further, it was pointed out that the resolution to sell the shares of M/s.Bush Boake Allen Ltd., by the assessee was taken by its Board of Directors on 28.05.2002. The corresponding resolution was passed by M/s.Bu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ourt in the case of Union of India another Vs. Azadi Bachao Andolan reported in (2003) 263 ITR 706 (SC) it was held that transaction cannot be regarded or called as a colourable device, so long as the transaction is valid in law. With the above reasons, CIT(Appeals) held that they are unable to sustain the disallowance of long term capital loss. 11. The Revenue filed appeal before the Tribunal. The Tribunal also made a fact finding exercise and held that the suspicion of the Assessing Officer is solely based on the ground that the assessee had knowledge about the purchasing back of its shares by M/s.Bush Boake Allen Ltd., and therefore the assessee sold the share to PCL, to its sister concern and M/s.Bush Boake Allen Lt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bunal found that the transaction is neither fraudulent nor a colourable device. Ultimately, the Tribunal held that when the transaction is within the parameters of law, then the Income Tax Authorities cannot enter into the shoe of the assessee to decide the prudence of commercial expediency of a particular transaction. With the above reasons, the Tribunal dismissed the appeal filed by the Revenue. 13. In our considered view, there is no substantial question of law arising for consideration in this case. We cannot be called upon to re-appreciate the evidence which was made available with the CIT(Appeals) and the Tribunal which in our considered view, has elaborately considered the factual matrix. So far as decision in the ca ..... X X X X Extracts X X X X X X X X Extracts X X X X
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