SREI Infrastructure Finance Ltd vs. ITSC (Delhi High Court)
The assessee entered into a scheme of arrangement u/s 391-394 of the Companies Act, 1956 pursuant to which it transferred its project finance business and assets based financing business to another company for a lumpsum consideration of Rs. 375 lakhs. The assessee filed a settlement application in which it claimed that the said consideration on transfer of the project finance business was not chargeable to tax as it was not by way of “sale” and there was no cost of acquisition for the same. However, the Settlement Commission that the said transfer, though effected through an order of the Court was a “slump sale” and was chargeable to tax u/s 50B. The assessee filed a Writ Petition to challenge the Settlement Commission’s order. HELD by the High Court dismissing the Petition:
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