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TMI Blog1979 (10) TMI 66X X X X Extracts X X X X X X X X Extracts X X X X ..... ts and liabilities of a partnership firm, M/s. U.P. Shoe Industries, Kanpur. The company was incorporated by all the persons, who were partners of the erstwhile firm, as shareholders. It appears that the firm had installed some machinery a few months before the company took over the assets of the firm. The company claimed development rebate on this machinery to the extent of Rs. 8,574. The ITO disallowed the claim on the view that the machinery was not new and had been previously used by the firm. The matter was taken up in appeal before the AAC who allowed the assessee's appeal on the view that all the conditions of s. 33(4) of the Act were fulfilled and as such development rebate as claimed by the assessee was allowable. The revenue appea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . In the present case, it is Dot disputed that this was so. All that had been contended is that these shareholders did not continue as such, but transferred their shares to other persons. But, inasmuch as cl. (iii) does not impose any fetter on the shareholders transferring their shares subsequent to the succession, the fact that they had done so, would not bring the case within the mischief of cl. (iii) of the Explanation. It was next contended that before relief under s. 33(4) could be given a finding should have been recorded by the Tribunal that the firm had been allowed development rebate in respect of the machineries. In order to appreciate this contention it is necessary to extract the opening part of s. 33(4) and the whole of s. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the business carried on by it as a result of which the firm sells or otherwise transfers to the company any ship, machinery or plant, the provisions of clauses (a) and (b) of sub-section (3) shall, so far as may be, apply to the firm and the company ......" It will be seen that in case of acompany succeeding to the business of a firm, the provisions of cls. (a) and (b) of sub-s. (3) of s. 33 had been made applicable in so far as may be. This means that s. 33(3) has to be read with necessary modifications so as to apply to the case of a firm succeeded by a company. Thus, in the opening part of s. 33(3), we have to read for the words " amalgamating company ", the word " company " and for the words " amalgamated company " the word " firm ..... X X X X Extracts X X X X X X X X Extracts X X X X
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