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2012 (3) TMI 256 - AT - Income TaxAssessee's claim with regard to benefit of indexation available to him from the year it was acquired by the 1st owner as against the year it was held by the assessee - the assessee held the property upon the death of his father and became owner of property by inheritance - the AO as per Explanation (iii) to section 48 of the Act contented that the assessee could get benefit of indexation only from the date when the asset was first held by him - Held that :- U/s 49(1)(iii), where the capital asset became the property of the assessee by succession, inheritance or devaluation, the cost of acquisition of asset shall be deemed to be the cost for which the previous owner of the property acquired it, as increased by the cost of any improvement of the assets incurred or borne by the previous owner or the assessee - the period from 1.04.1981 till the death of previous owner shall be included in the period of holding by the assessee for the purpose of determination of indexation cost of the property Dis allowing deduction under sec. 54 of the Act in respect of the whole of the amount invested by the assessee in the purchase of residential house - assessee purchased residential property in joint name with his wife and claimed deduction under sec. 54 in respect of amount of invested in residential property and the whole purchase consideration was paid by the assessee only out of sale proceeds of the property the name of his wife in the agreement to transfer was included only to avoid future hassle due to old age of the assessee his wife has not contributed towards purchase of property nor does her name get reflected in the possession certificate - Held that :- the assessee had invested ₹ 80,00,000/- in the house property, which was jointly held by him with his wife, his wife is a joint owner and did not have any source of income - property was purchased only by the assessee by deploying long term capital gain on sale of property, which he received on inheritance - the name of his wife has been entered in the sale agreement just for the purpose of security reasons - as per Section 64(1)(iv) subject to provisions of sec. 27(i) the income as arises directly or indirectly to the spouse of an individual from the assets transferred directly or indirectly to the spouse by such individual otherwise than for adequate consideration shall be included in the income of such individual - Once the assessee is owner, the capital gain, if any, on sale will be assessable in the hands of the assessee only - the assessee will be eligible for benefit of entire amount spent on acquisition of new asset, which is jointly held by him with his wife - allow the benefit of sec. 54 in respect of entire amount of ₹ 80,00,000/- - both the appeals of revenue were dismissed.
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