In this case the Tribunal held that scheme of amalgamation was duly approved by two High Courts and shareholders, creditors and bankers of both the companies, Registrar of Companies, etc. at two places, after giving due notice by publication in newspapers and, therefore, it could not be said that the scheme of amalgamation was a colourable device and an afterthought. Therefore, consideration received on sale of share of another company by the amalgamating company prior to the scheme of amalgamation can be taxed in hands of amalgamating company only. (AY. 2003-04 to 2005-06).
ACIT v. Investment trust of India Ltd. (2021) 211 TTJ 777 (Chennai) (Trib.)
S. 45 : Capital gains-Amalgamation-sale of shares prior to transfer of business by way of slump sale and amalgamation-scheme of amalgamation approved by High Court and shareholders-allegation of scheme of amalgamation as an afterthought without any basis-capital gains already offered for tax by the amalgamating company-same cannot be taxed again in the hands of amalgamated company.