Dealing with the issue of period of holding for computing capital gains the Tribunal held that “financial asset” has been described in the Act as share or security and the assets transferred by the assessee did not fall in the category of “financial asset”. Section 2(11) which defines the term “block of assets” for the purpose of depreciation includes intangible assets. Since intangible assets were covered in the definition of “block of assets” eligible for depreciation, they could not be again covered under the definition of “financial asset” as per Explanation (1)(i)(d) to section 2(42A) . Therefore, the period of holding could not be determined under Explanation 1(i)(e) but in terms of Explanation 1(i)(b) to section 2(42A) to determine whether or not an asset is a short-term capital asset. The assessee’s case was a scheme of amalgamation and the assessee was an Indian company. Therefore, it was not correct for the Assessing Officer to consider April 1, 2008 as the date on which the assets were acquired because the brand name was already there with the amalgamated company which was registered with the Trade Marks Registry. Therefore, there was no transfer taking place on April 1, 2008. The period of holding was much more than 36 months when the relinquishment or sale took place (on May 18, 2010). Therefore, the Assessing Officer ought not to have taxed the receipts as short-term capital gains but should have taxed them as long-term capital gains. The Explanation to section 49(1) is a benevolent provision to extend applicability of the term “previous owner” to cover cases like the assessee’s. Here the previous owner was the amalgamating company and this company did not acquire the assets in a mode referred to in clause (i) or clause (ii) or clause (iii) or clause (iv) of section 49(1) . However, as no purchase price was paid by the amalgamating company, the cost of acquisition was taken as nil as required under section 55(2)(a)(ii) .( AY.2011-12)