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2017 (8) TMI 1191 - DELHI HIGH COURTComputing taxable gain under Income Tax Act - quantum - development agreement - assessee contended that, what was transferred under the collaboration agreement was only 44% of the land owned by them in exchange for 56% of the built up area and not the entire land - consideration in kind - Held that:- ITAT has rightly decided that, "it is clear that in the year under consideration, there was transfer of not only the flats as super structure but also the proportionate land in as much as 56% of the land was retained by the assessee under the collaboration agreement. So we are in agreement with the alternate contention of the assessee's counsel that it was a sale of improved asset and consequently, cost of acquisition would include the cost of flats as well as cost of land. As far as cost of flat is concerned, we have already observed that it would be equal to the cost of construction of 56% of the built up area. The reason is obvious. The sale consideration of 44% land was in kind and, therefore, it also amounted to investment in the construction of built up area. Hence, the same will be taken as cost of acquisition of flats after examining the record of the builder" - Decided in favour of the Revenue and against the Assessee. However, ITAT did commit an error by not reducing the land and development charges from the sale consideration received by the Assessee while working out the capital gains. - This issue decided in favor of assessee.
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