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13. Jindal Equipment Leasing Consultancy Services Ltd. vs. Commissioner of Income Tax Delhi - II, New Delhi
(2026) 182 taxmann.com 219(SC)
Amalgamation – Shares issued by amalgamated company in lieu of share of amalgamating company – Taxability - If shares are held as capital assets, the profit arising to the Assessee from the receipt of shares of the amalgamated company in lieu of shares of the amalgamating company would be taxable as capital gains, though exempt under Section 47(vii) - If the shares are held as stock-in-trade, the profit arising to the Assessee from the receipt of shares of the amalgamated company in lieu of shares of amalgamating company would be taxable as "profits and gains of business or profession" under Section 28 if they are readily available for realisation.
The Assessee was an investment company of the Jindal Group. The shares of the operating companies, namely Jindal Ferro Alloys Limited (JFAL) and Jindal Strips Limited (JSL), were held as part of the promoter holding, representing controlling interest. The Assessee had also furnished non-disposal undertakings to the financial institutions / lenders who had advanced loans to the operating companies. These shares were reflected as investments in the balance sheets of the Assessee.
