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2017 (10) TMI 1003 - AT - Income TaxRight to property - long term capital gain - period of holding - whether is a capital asset u/s. 2(14)? - assessee was holding the right to property during the period 1st April, 2002 to 10th February, 2006 i.e. for a period of 4 years and 9 days (exceeding 36 months) - Held that:- The owners of the plot have authorised the developer to take the plot and the moment the assessee has booked the flat and flat has been allotted to the assessee, a valuable right has created. It is a capital asset and that right continued till the assessee entered into tripartite agreement dated 10th February, 2006. Under section 45 of the Income Tax Act transfer of a capital asset is chargeable to tax under the head ‘capital gains’ and not under the head ‘income from business’. It is not a case of the Revenue that the assessee was regularly booking flats and selling the same so that it can be said that the assessee has entered into a business transaction. The income shown by the assessee has to be assessed under the head ‘income from capital gains’. The capital derived by the assessee is long term capital gain as the assessee held the right on the asset for more than 36 months. We therefore set aside the order of the CIT(A) and direct the AO to treat the said profit as long term capital gains a returned by the assessee. - Decided in favour of assessee.
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