TMI Blog2017 (6) TMI 1076X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Act. None of the lower authorities has confirmed the same by issuing a notice u/s 133(6) of the Act to Stamp Valuation Authorities to determine the actual stamp valuation. In the absence of any confirmation from the Stamp Valuation Authorities, we are inclined to restore this issue to the file of AO for fresh adjudication in accordance with law and in the light of above stated discussion. Hence, this ground of Revenue’s appeal is allowed for statistical purposes. Allowing interest pertaining to earlier financial years as part of the cost of acquisition under the head capital gain - Held that:- There is no doubt that the interest in question is indeed a expenditure in acquiring the asset. Therefore, the assessee in the instant case is certainly entitled to include the interest amount at the time of computing capital gains u/s 48 of the Act. Therefore, the Ld CIT(A) has rightly accepted the assessee's contention and deleted the addition made by the AO. Hence, qua this ground, we uphold the order of the Ld. CIT(A). - ITA No. 169/Kol /2014 - - - Dated:- 23-2-2017 - Shri Aby.T Varkey, Judicial Member And Shri Waseem Ahmed, Accountant Member By Appellant : Shri P.K. M ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed, assessee preferred an appeal before Ld. CIT(A). The assessee before the ld. CIT(A) submitted that the impugned flat was purchased in September 2000 and the same was sold in May 2005. So the period of holding is more than 36 months and therefore the same should be treated as LTCG. The ld. CIT(A) after considering the submission of the assessee has granted the relief by observing as under:- 8.3.4 The AR of the appellant has also argued that the AO has erred is considering the capital gain as short term in nature, instead of long term. The said flat has been allotted to the appellant on 28.09.2000 by West Bengal Housing Board , which has been later on registered by the appellant on 14.03.2005. The AO has considered 14.03.2005 as date of purchase and computed capital gain accordingly in the assessment order. In this connection the Ld. A/r has cited judgment in the case of CIT vs. Jindas Panchand Gandhi. I have duly considered the appellant s submissions, cited case laws, AO observation in the assessment order the AO has not given any comment on the issue in the remand report. Thus, I am of the opinion that as the property in question has been allotted to the appellant on 28.0 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... elivered on a later date. The mere fact that possession was delivered later, does not detract from the fact that the allottee was conferred a right to hold property on issuance of an allotment letter. The payment of balance installments, identification of a particular flat and delivery of possession are consequential acts that relate back to and arise from the rights conferred by the allotment letter. Thus, in our view the date of allotment should be taken as the date of purchase of the impugned flat. While holding so we also find guidance and support from the following judgments. 1) CIT, Salary Circle, Chennai v. S.R.Jeyashankra (2015) 53 taxmann.com 107 (Mad) wherein it was held as under : 8. The Delhi High Court has also observed in the decision, which has been extracted in the order of the Tribunal in paragarph 7.1 of the order, holding that the date of allotment of the flat to the assessee by the promotor should be adopted as the date of acquisition of the immovable property. In the present case, the right to the property flows from the date of agreement with the builder, viz., 22.2.2005. Over a period of time payments have been made and the transaction was concluded in a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the allotment letter and the payment of instalments is only a follow-up action and taking the delivery of possession is only a formality. If there is a failure on the part of the Delhi Development Authority to deliver the possession of the flat after completing the construction, the remedy for the allottee is to file a suit for recovery of possession. 3. The Board have been advised that under the above circumstances, the inference that can be drawn is that the Delhi Development Authority takes up the construction work on behalf of the allottee and that the transaction involved is not a sale. Under the Scheme, the tentative cost of construction is already determined and the Delhi Development Authority facilitates the payment of the cost of construction in instalments subject to the conditions that the allottee has to bear the increase, if any, in the cost of the construction. Therefore, for the purpose of capital gains tax, the cost of the new asset is tentative cost of construction and the fact that the amount was allowed to be paid in instalments does not affect the legal position stated above. In view of these facts, it has been decided that cases of allotment of flats un ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sessee was allotted flat on 27th Feb., 1982 on payment of instalments by issuance of an allotment letter and he had been making payment in terms thereof but the specific number of the flat was allocated to the assessee and possession delivered on 15th May, 1986. The right of the assessee prior to 15th May, 1986 was a right in the property. In such a situation, it cannot be held that prior to the said date, the assessee was not holding the flat. Therefore, the flat allotted to the appellant vide allotment letter dt. 27th Feb., 1982 which was sold on 6th Jan., 1989 was a long-term capital asset and the investing of sale proceeds thereof for the purchase of another house was exempted under s. 54.-CIT vs. Ved Parkash Sons (HUF) (1993) 115 CTR (P H) 63 : (1994) 207 ITR 148 (P H) followed. Taking a consistent view and relying on the aforesaid judgments of Hon'ble High Courts and facts of the present case, we find no infirmity in the order of ld. CIT(A). In the instant case letter of allotment is on 28.09.2000 and accordingly the right was acquired on that date. The assessee sold the property which was acquired by way of letter of allotment dated on 11.05.2005. Accordingly, th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s valued at ₹ 33 lacs for the purpose of Stamp valuation and at the same value the impugned property was transferred. However, the assessee expressed her inability to submit the papers (sale deed) as it was not available with her. The assessee further submitted that as per the provisions of section 50C of the Act, the stamp value should be adopted for the capital gain purposes. The Ld. CIT(A) called for remand report from the AO but he failed to respond. However, the ld CIT(A) after considering the submission of the assessee has given relief to the assessee by observing as under:- 8.3.2 The first issue in this ground is that the AO has erred in applying section 50C of Income tax Act. While passing order the AO has considered valuation made by the ADSR, Sealdah, being ₹ 59,28,000/- as sales consideration. However, the Ld. A/r has submitted that section 50C has the concept of adopting valuation made by stamp duty authorities as sales consideration and there is no concept of market value in section 50C of Income Tax Act. I have gone through the section 50C of the Income Tax Act and agree with the assessee s contention that for computing capital gain a per secti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g of Section 50C, it is evident that Section 50C is a deeming provision and it extends only to land or building or both. Section 50C can come into play only in a situation where the consideration received or accruing as a result of the transfer by an assessee of a capital asset, being land or building or both is less than the value adopted or assessed or assessable for the purpose of payment of stamp duty in respect of such transfer. It is settled legal proposition that deeming provision can be applied only in respect of the situation specifically given and, hence, cannot go beyond the explicit mandate of the section. In the instant case, we find that both the lower authorities have taken a different deemed sale consideration as provided under section 50C of the Act. None of the lower authorities has confirmed the same by issuing a notice u/s 133(6) of the Act to Stamp Valuation Authorities to determine the actual stamp valuation. In the absence of any confirmation from the Stamp Valuation Authorities, we are inclined to restore this issue to the file of AO for fresh adjudication in accordance with law and in the light of above stated discussion. Hence, this ground of Revenue s ..... X X X X Extracts X X X X X X X X Extracts X X X X
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