Case Law Details
Case Name : Aravali Polymers LLP Vs Joint Commissioner of Income Tax (ITAT Kolkata)
Related Assessment Year : 2011- 2012
Courts :
All ITAT ITAT Kolkata
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Conversion To LLP – Capital gains to be computed on book value of assets transferred and not on market value
A perusal of the provisions of section 45 of the Income Tax Act shows the levy of capital gains to be on the profits or gains arising from the transfer of capital asset effected in the previous year. Admittedly, the erstwhile Company Aravali Polymers Pvt. Ltd. converted into a partnership firm Aravali Polymers LLP, a Limited Liability Partnership firm. This took place on 12.08.2010 being the asses
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At the first blush, subject to an independent study in-depth, the point of controversy as settled by the first appellate authority is noted to essentially bring to the fore one important thing: The extant applicable provisions gone into by the itat are not so clear as to lend scope for a straightforward reading and intelligible interpretation of the law. As such, the matter,it is anybody’s guess as to what view would be finally taken, if, as is likely,pursued in further proceedings. No need to add that,now it is in the representing counsels’ court to put up all possible pleas only after making an incisive study, in order to ensure that the final opinion eventually handed out, by any yardstick, comes to prove a logically right or better view,in its profound sense.
Meanwhile, it is worthwhile for the law and finance ministries to probe into and decide how best the extant provisions could be modified so as to bring about clarity; as that should save from a protracted litigation and be for the common good.