appeal of revenue filed under Sec. 260A of the Income Tax Act (the "Act' in
brevity) is directed against the order dtd. 8/7/2016 passed by the Income
Tax Appellate Tribunal, B-Bench, Kolkata (the "Tribunal') in ITA No.2796/Kol/2013
for the assessment year 2010-11.
(2.)The revenue has raised the following substantial questions of law for consideration
"(a) Whether on the facts and in the circumstances of the case, the Learned Income Tax Appellate Tribunal, "B" Bench erred in law in holding that the total consideration for sale of shares was Rs.10,40,09,705.00 only, ignoring the fact that it was specifically and clearly mentioned in the agreement for sale entered into by the assessee that the lump sum sale consideration for the 99.97% of the share capital held by the assessee in KCCL was a sum of Rs.15,37,35,633.00 ?
(b) Whether on the facts and in the circumstances of the case, the Learned Income Tax Appellate Tribunal, "B" Bench erred in law in holding brokerage charges as expenditure of the assessee on account of sale of shares, ignoring the fact that the brokerage was in essence raised on sale of property not in name of the assessee but in the name of the subsidiary company and was not raised on sale of shares ?"
(3.)The short question involved in this appeal by the revenue is whether the assessee
had received a sum of Rs.15,97,25,928.00 as sale consideration for sale of the shares
in question or whether the assessee received only Rs.10,40,09,705.00 as sale consideration.
This issue arose before the assessing officer who called upon the assessee to
explain as to why only in the Return of income they had reflected the sale consideration
for the sale of shares only as Rs.10,40,09,705.00 and not as Rs.15,37,35,633.00 as
mentioned in the share purchase agreement dtd. 29/1/2010. The assessee's
explanation was that Rs.4,97,25,928.00 was towards repayment of a loan and the
said amount was not received by the assessee towards sale consideration for
sale of shares and the sum received by them was only Rs.10,40,09,705.00. This explanation
was found to be not acceptable by the assessing officer who completed the assessment
by order dtd. 14/3/2013. The assessee challenged the same by filing an
appeal before the Commissioner of Income Tax (Appeals) IV, Kolkata (CIT(A) in brevity).
The CIT(A) considered the facts of the case and more particularly, clause 2 of
the agreement in its entirety which consists of various sub-clauses namely Clauses
2.1, 2.2, 2.2.1, 2.2.2, 2.2.3 and 2.2.4. After noting the facts, the CIT(A) recorded a finding that the assessee had received only a sum of Rs.10,40,09,705.00 as sale
consideration for sale of shares. The CIT(A) referred to the decision of the Hon'ble
Supreme Court in the case of Commissioner of Income Tax vs. Hooghly Mills Company
Limited (287 ITR 333). The revenue carried the matter in appeal to the
Tribunal. The Tribunal re-appreciated the facts, more particularly clause 2 of the
agreement in its entirety and held that the purchasers of shares took over the
liability of the assessee and acknowledged the purchasers as creditors in so
far as the sum of Rs.4,97,25,928.00 is concerned. Further, the Tribunal stated
that there is nothing available on record to show that the said amount was
received by the assessee as sale consideration towards the sale of shares and,
therefore, the same cannot be attributed to consideration for sale of the