Capital Gain - Sale of entire undertaking ::

Court :
HC

Brief :
Asst.C.I.T. Vs. Raka Food Products

Citation :
Asst.C.I.T. Vs. Raka Food Products

Capital Gain - Sale of entire undertaking Asst.C.I.T. Vs. Raka Food Products 6/20/2005 (2005) 277 ITR 261 (Mad) Case Fact: Whether in a sale of the entire undertaking (bakery) as a whole, if two separate documents with respect to movable and immovable (Land) assets are executed, the provision of section 50 of Income-tax Act, 1961, will be applicable? Decision: Held by the Hon"ble court that once the immovable property forms part of the assets of the undertaking sold as a whole the sale consideration cannot be bifurcated even though transfer of immovable property could only be made through a registered sale deed, hence section 50 could not be applied as it is applicable when movable assets are alone transferred. The gain is to be assessed as long term capital gain and exemption u/s 54E be granted.

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Judgement posted by

CA.Saibaburao Nanduri

Chartered Accountant

I am a commerce graduarte of Andhra University. Studied at HINDU COLLEGE, Guntur. Became FCA and started Practice under the name and style of M/s SAIBABU RAO CO I became Chairman of CA Institute, Guntur Branch, during the year 2008-09 My post qualifications are: Information Systems Audit DISA (ICAI) ... Read more

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