Karnataka HC says Firm Conversion Does Not Lose Section 47(xiii) Relief

Atria Wind succeeded to the business of a partnership firm and claimed the benefit of Section 47(xiii). The Revenue alleged that changes in partners' capital and withdrawals before succession breached the exemption conditions. The High Court rejected the challenge, holding that there was no change in the firm's assets and liabilities immediately before succession and no evidence that the partners received consideration other than shares in the company.