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2011 (8) TMI 453 - AT - Income TaxDetermination of capital gain - Section 51 of the Act is applicable to an aborted transaction only - Whereas in the instant case there was neither cancellation nor forfeiture of any deposit and hence section 51 has no application - As per the decision of the Apex Court in the case of Travancore Rubber & Tea Co. Ltd. v. CIT [2000 -TMI - 5789 - SUPREME Court] wherein the Supreme Court has very clearly held that under section 51 retention of any money by the assessee is not taxable at all and it is a capital receipt - However, it has to be reduced from the cost of asset so that at the time of subsequent sale of the said asset net cost would be considered and not the original cost - thus the capital gains as worked out by the assessee under section 48 of the Act, after considering the cost inflation index applicable to the assessment year 2004-2005 is in accordance with law and therefore, deserves to be accepted - Held that assessee is entitled to work-out the capital gains under section 48 of the Act after considering the cost inflation index applicable to assessment year 2004-2005.
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