ADARSH KUMAR GOEL, J. - (1.) THIS appeal has been preferred by the Revenue under s. 260A of the IT Act, 1961 (for short 'the Act') against the order proposing to raise following substantial questions of law : "(i) Whether, on the facts and in the circumstances of the case and in law, the Tribunal is right in holding that the sale of Betalactum division by the assessee company was a slump sale to which ss. 50 and 50A are not applicable and that long -term capital gain is to computed by indexing the cost of acquisition of the Betalactum division and its improvement -
(2.) THE assessee claimed loss of Rs. 12,67,69,823 under the head "Long -term capital loss" or the sale of Betalactum division on slump sale basis by deducting, from the sale proceeds, the acquisition of the Betalactum division and improvement. The AO rejected the plea of the assessee and held that by virtue of provisions of ss. 50 and 50A, excess of sale consideration over the WDV of block of assets, was liable to tax as short -term capital gain. It was also held that which view has been upheld by the Tribunal.
(3.) WE have heard learned counsel for the parties and perused the record. In para 20 of its order, the Tribunal held that the sale was slump sale if it was a sale of going concern, even if some of the assets were retained by the transferor and, thus, ss. 50 and 50A of the Act, were not applicable. Para 29 of the order is reproduced below : "29. From the above, it is evident that for a sale to be termed as a 'slump sale', it is not essential that all the assets and liabilities must be transferred. Even if some assets and liabilities are retained by the transferor, the sale would not lose the character of being a slump sale, if the transfer is of a going concern, on that basis and the transferee is in a position to carry on the business without any interruption. In the present case, the right to use the technical know -how developed by the assessee was granted by the assessee to the transferee against the payment of a separate judicial pronouncements, it cannot be said that what the transferee acquired was not a going concern. Rather, after the transfer, the transferee carried on the business without any disruption therein. In CIT vs. West Coast Chemicals & Industries Ltd.s' case (supra), F.X. Periera & Sons (Travancore) (P) Ltd.s' case (supra), Premier Automobiles Ltd.s' (supra) and Raka Food Products's case (supra), amongst others, it has been held that in the case of a sale of an undertaking as a whole, on a going concern basis, if some assets are retained by the transferor or some liabilities are not taken over by the transferee, this fact does not render the slump sale as not a slump sale. A similar view has been expressed by the Delhi Bench of the Tribunal in ITA. Nos. 2584/Del/2003, for asst. yr. 1999 -2000 and 5507/Del/2003, Therefore, the findings of the learned CIT(A) in this regard are upheld.";