IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH ‘C’: NEW DELHI BEFORE SHRI S.RIFAUR RAHMAN, ACCOUNTANT MEMBER and SHRI ANUBHAV SHARMA, JUDICIAL MEMBER (Assessment Year: 2008-09)

ACIT, Circle 5 (1) vs. M/s. KCT Papers Limited, New Delhi. Thapar House, 124, Janpath, New Delhi – 110 001.

(PAN : AACCK4937D)

(APPELLANT) (RESPONDENT)

ASSESSEE BY : Shri Rohit Jain, Advocate Shri Deepesh Jain, Advocate Shri Tavish Verma, Advocate REVENUE BY : Shri Kailash Dan Ratnoo, CIT DR Date of Hearing : 10.09.2025 Date of Order : 05.12.2025

O R D E R

PER S.RIFAUR RAHMAN, ACCOUNTANT MEMBER :

1. This appeal is filed by the assessee against the order of ld. Commissioner of Income-tax (Appeals)-VIII, New Delhi [hereinafter referred to as ‘ld. CIT (A)] dated 21.03.2014for Assessment Year 2008-09.

2. Brief facts of the case are, the assessee company belongs to the Thapar Group established by Late Lala Karam Chand Thapar. There was a family settlement between the various constituents of the Karam Chand Thapar family as a result of which Revenue-organization/restructuring of the group companies had taken place by virtue of Memorandum of family settlement dated 27^th April, 2001. The re-organization of the Group Companies & Trusts was made into four groups, as under, each headed by the sons of Late Lala K.C. Thapar. The family tree of Karam Chand Thapar family is explained as under in the form of a diagrammatic chart:

3. The aforesaid Memorandum of family settlement provided for the re-

structuring of the companies as under:

i. Scheme 1- Amalgmation of Nikhlesh Investments and Holdings (NIHL) with Karam Chand Thapar and Bros. Limited (KCTBL)

ii. Scheme 2- It was comprised of two stages as under:

Stage 1- Amalgamation of Modern Agencies Limited (MAL)&Gupkar Investments and Holdings Limited (GHIL) with KCTBL.

Stage 2- Demerger of KCTBL into 7 companies namely KCT Coal Limited (KCL), KCT Chemicals and Electricals Limited (KEL), KCT Papers Limited (KPL), KCT Textiles Limited (KTL), RMS Merchantile Limited (RMS), PML Merchantile Limited (PML) and JMK Merchantile Limited (JMK). Thus, the assessee company, M/s KCT Papers Ltd. is one of the resulting companies.

4. The various schemes of amalgamations and demergers have been duly approved and sanctioned by the Hon. High Court of Delhi and Bombay in terms of section 391 and 394 of the Companies Act. The effective date of all the aforesaid amalgamations and demergers was 15t April, 2006.

5. The assessee company belongs to the BMT group which comprises of Sh.

B.M. Thapar s/o Late Lala Karam Chand Thapar and his two sons, Sh.

Gautam Thapar and Sh. Karan Thapar.

6. The facts pertaining to the Long term capital gains on sale of rights, title and interest in commercial site are that Modem Agencies Ltd. and KCT Bros Ltd.

(Both of which ultimately merged under amalgamation had together invested Rs.4,10,00,000/- in the past with M/s Energetic Construction Pvt. Ltd. which was supposed to develop World Trade Centre at Gurgoan and the above mentioned two companies were together entitled for 24261 sq ft. of built area @ 1640 per sq ft. when property would be built. After amalgamation of Modem Agencies Ltd. with KCT Bros Ltd, entire right become concentrated in KCT Bros. Ltd. and subsequently when the demerger took place in KCT Bros Ltd., this right was passed on to 4 (out of 7) of the resulting companies, assessee company being out of them. The aforesaid rights, title and interest were transferred to M/s TCG Urban Infrastructure Holding Ltd. for a total consideration of Rs.20,78,62,944/-. Thus, the assessee's 1I4th share of consideration was Rs.5,19,65,736/-. Indexed cost of acquisition of such rights was Rs.1,83,39,832/-. Accordingly, assessee has offered Rs. 3,36,25,904/-

being its 1/4^th share of Long term capital gains.

7. The losses in respect of shares of Ballarpur Industries Ltd have resulted due to buyback of these shares made by the company. Initially, BILT had allotted shares of face value of Rs.10/-. Subsequently, these were split into