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2013 (7) TMI 960 - ITAT MUMBAIAddition on account of long term capital gains - Held that:- The perusal of the provisions of the agreement indicates that the amount of ₹ 20 crore is the maximum amount that could be received by the assessee’s group which comprises of initial consideration and the deferred consideration. It also indicates that there is no guarantee for the receipt of this maximum amount by the assessee’s group. In view of that matter, we find merit in the contention of the senior counsel for the assessee that what is to be taxed is the gain received or accrued and not the notional/ hypothetical income as decided by the Hon’ble Supreme Court in the case of K.P. Varghese vs. ITO (1981 (9) TMI 1 - SUPREME Court). It is an established legal proposition that as per the provisions of capital gain, the amount can be brought to tax either on receipt basis or accrual basis. As regards the decision of the Supreme Court in the case of CIT vs. George Henderson & Co. Ltd and the decision of the ITAT in Mrs. Alpana Piramal case relied on by the Ld.DR, it is our considered view that these decisions have no application as the ratios in the said cases are applicable when the dispute relates to adopting the full value consideration vis-a-vis the sale value consideration which is not the case of the AO in this instant case as the maximum cap provided in the agreement cannot be equated neither with sale value consideration nor with the full value consideration since the said maximum cap is neither received nor accrued for the purposes of calculating the capital gains. In view of that matter, we do not find any infirmity in the order of the Ld.CIT(A) and the same is upheld.
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