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2015 (6) TMI 92 - AT - Income TaxCapital gain in respect of the development right of property - AO held that since the property was acquired from her late parents, therefore, the cost of acquisition would be taken at ‘Nil’ - Held that:- The consideration as stipulated in the development agreement was passed to the assessee only in the A.Y. 2006-07. The amount of ₹ 80,000/- was mainly to allow the developer to develop the said plot. As per the express terms of the agreement with the developer, the assessee in lieu of surrendering the rights to the developer was entitled for flat admeasuring 700 sq. ft free of cost . Thus, the consideration for the transfer of rights was handing over the flat. This transaction had taken place in the December 2005. Thus, we agree with the contention of the department that the long term capital gain will arise in the A.Y. 2006-07. Regarding cost of acquisition we agree with the contention of the learned counsel that the same cannot be taken at ‘Nil’, because the previous owner, that is, father of the assessee had acquired the property much before 01.04.1981. Thus the market value as on 01.04.1981 has to be adopted and accordingly the fair market value has to be adopted as on 01.04.1981. Since the department has not adopted any fair market value as on 01.04.1981, the fare market value as determined by the registered valuer as on 01.04.1981 appears to be correct. However, the AO shall examine the said value as determined by the registered valuer. Regarding the sale value for the purpose of determination of long term capital gain, the same also needs to be verified because the learned counsel before us has submitted that the stamp valuation authority has determined the stamp value of the flat at ₹ 4,43,500/-. Thus, the issue of determination of fair market value as on 01.04.1981 and the sale consideration in the A.Y. 2006-07 is set aside to the file to the AO who shall examine the contention of the assessee, then determine the long term capital gain. Claim of benefit u/s 54F has not been taken either before the AO or before the Ld. CIT(A). Therefore, being a legal claim, the additional ground raised by the assessee is admitted and the matter is restored back to the file of the AO, who shall examine the same and allow the claim of deduction/benefit in accordance with law - Decided partly in favour of assesse for statistical purpose.
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