KARNATAKA INSTRADE CORPORATION LTD Vs. CIT

JUDGEMENT

(1.) Appeal under s. 260A of the IT Act, 1961 (for short, the Act) by an assessee, a public limited company registered under the provisions of the Companies Act, 1956 seeking to raise the following substantial questions of law for our examination in this appeal:

(2.) Insofar as the present appeal is concerned, the dispute is only relating to the income attributable to capital gain as had been revealed by the assessee in its return of income. The assessing authority finalized the assessment on such premise, but found occasion to add back certain other sums under some other heads etc., and arrived at the taxable income as Rs. 5,02,09,941 and raised a demand and also directed initiation of penalty proceedings under s. 271(1)(c) of the Act separately.

(3.) The assessee. was in appeal, inter alia, contending that out of Rs. 11,15,44,005 as capital gain as has been declared by the assessee in its IT return, while only a sum of Rs. 31,60,000 was assessable to tax being attributable to transfer of some capital assets, the balance sum of Rs. 10,83.84,005 could not be assessed as income attributable to capital gain, as the amount had been transferred to capital reserve account even in terms of the note appended to the return.