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COMMISSIONER OF INCOME TAX-IV Versus M/s. IK. INTERNATIONAL PVT. LTD. - 2012 (4) TMI 347 - DELHI HIGH COURT
Claim of exemption under Section 54EC - ITAT hold that AO was not justified in invoking Section 50(2) - assessee computed LTCG on the sale of land and having invested the gains in REC Bonds claimed gains as exempt under Section 54 EC of the Act Held that - A combined reading of Section 2(11), Section 32(1) and Section 50(2) of the Act shows no depreciation is allowable in respect of land as it is not specifically mentioned as an asset eligible for depreciation - if land is not a depreciable asset and cannot form part of the block of assets in the absence of a rate of depreciation the provisions of Section 50 of the Act cannot be invoked land as an asset was held for a period of more than 36 months the surplus of the sale price over the indexed cost of acquisition was rightly shown as LTCG AND investment in REC Bonds the entire long term capital gains are exempt under Section 54EC of the Act - against revenue. - Cost attributed to the building when it was purchased was only Rs. 68, 00,000/- divided in two properties and the assessee had incurred expenditure on additions to the building up to 31.03.2003 and reckoned from this date the assessee did not hold the property for more than 3 years and, therefore, the sale of land c ....... - .......