Allowing the appeal of the revenue the Court held that ; the reason assigned by the assessee was that the authorised share capital of the company was not increased suitably to make the allotment of these shares to the partners and the consideration for their intended allotment of shares in proportion to their share capital was credited in the “shareholders’ fund account” in the books of account maintained by the company. This was not a sufficient reason or excuse to delay the process of allotment of shares in the company in favour of the erstwhile partners to an unreasonably long period of about three and half years. The conditions laid down in section 47A were not complied with during the previous year 1999-2000 relevant to assessment year 2000-01.  Accordingly the imposition of tax on capital gains on the assessee was valid. ( AY.2000-01)