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2016 (4) TMI 1115 - AT - Income TaxLong term capital gain - apportionment of WDV - Held that:- Assessing Officer had made this addition on protective basis however, since this addition was not made in Asst. Year 2010-11, therefore, the addition was treated as substantive in the year under consideration. The facts in this regard are that the assessee had declared sale of land and building at ₹ 1.20 croes. The Assessing Officer held that since building was a depreciable asset, therefore, sale value is to be reduced from block of assets and land being a non depreciable asset. The long term capital gain is to be computed on sale of such land. The Assessing Officer while computing the long term capital gain apportioned the sale consideration of ₹ 1.20 crores between the land and building wherein he took the estimated value of building at ₹ 20 lac and assigned value of ₹ 1 Crore to land. The Assessing Officer held that since cost of acquisition of property was taken by assessee towards building on which depreciation was claimed in earlier years, therefore, the cost of acquisition of land was taken as Nil and thereby he calculated long term capital gain to the tune of ₹ 1 Crore. The learned CIT(A), on the other hand, apportioned the written down value of land and building as on 31.3.2008 between land and building on the same ratio on which Assessing Officer had apportioned the sale consideration between land and building and therefore, cost of acquisition of land was calculated and after applying indexed of cost of acquisition long term capital gain was calculated. We find that learned CIT(A) has taken a reasoned view and has rightly apportioned the WDV as on 31.03.2008 between land and building and we do not find any infirmity in the same.
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