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2019 (2) TMI 1055 - AT - Income TaxCapital gain computation - Additional compensation received from CIDCO in form of re-allotment of land under 12.5% scheme is taxable under the head ‘capital gain’ - inclusion of cost of acquisition - Held that:- Cost of land when it was subsequently transferred shall be determined as on the date of receipt of additional compensation. The stamp duty authorities have fixed the market value as on the date of re-allotment of land to the assessee is at ₹ 9,14,40,000. Since the authorities fixed the cost of land as on the date of allotment is ₹ 9,14,40,000, obviously cost of acquisition for the assessee, when the land has been subsequently sold, will have to be taken at ₹ 9,14,40,000. AO is incorrect in not allowing the cost of acquisition to the assessee while computing long term capital gain on transfer of leasehold rights in land. We direct the AO to re-compute long term capital gain. However, such long term capital gain computed by the AO shall not go below long term capital gain computed by the assessee in her return of income, because the assessed income cannot go below the returned income. Payment of consideration to M/s Perfect Associates, it is irrelevant for the purpose of computation of long term capital gain, because the assessee has failed to prove the testimony of the documents including agreements entered into between M/s Perfect Associates so as to show that it is genuine document and also the said consideration had been paid for rendering services in connection with transfer of property. Further, when total enhanced compensation is exempt, related expenses need to be ignored for computation. Accordingly, we set aside the issue to the file of the AO for the purpose of re-computation of long term capital gain in terms of our discussions given in the preceding paragraphs hereinabove - Appeal filed by the assessee is allowed, for statistical purpose.
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