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2015 (11) TMI 386 - HC - Income TaxComputation of income arising from the conversion/treatment of land into stock-in- trade of construction business and profits thereon - invoking of section 45(2) accepted by ITAT - Held that:- The fact that the land and its buildings were treated by the respondent-assessee as capital asset as, according to them, the project was not completed loses all significance, once the Revenue does not accept the same and proceeds to hold that the property had been sold in the subject assessment year and the same has to be subjected to tax. On the aforesaid finding, the issue of conversion of a capital asset into stock-in-trade would arise and require consideration. The impugned order on facts has found the land was originally a capital asset which has later been converted into stock-in-trade. Thus, section 45(2) of the Act is applicable. However, the capital gains on conversion of capital assets into stock-in- trade is payable only in the year in which the assessee ultimately sells such stock-in-trade yet for purpose of computing capital gains the date of conversion would have to be determined. This exercise has to be carried out by the Assessing Officer after considering the evidence to be led before it. Thus, no fault can be found with the above direction of the Tribunal as it is a consequence of the finding of fact arrived at by the Tribunal that the land in question was originally held as capital asset and was later converted into stock-in-trade. - Decided against revenue. Concealed income on account of certain cash transactions - evidence found during the course of survey under section 133A - Tribunal reached a finding of fact on examination of documents that there is no corroboration to the stand of the Assessing Officer that there was cash element of ₹ 27.31 lakhs involved in sale of the flat at ₹ 2.11 crores - Held that:- The above findings of the Tribunal are a finding of fact and the lower authorities without any basis drew an inference that an amount of ₹ 27.31 lakhs was the amount received in cash by the respondent- assessee. We find that the aforesaid conclusions reached by the Tribunal is a possible and reasonable view. Thus, no substantial question of law arises for our consideration. - Decided against revenue.
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