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2020 (5) TMI 434 - AT - Income TaxDeduction u/s 54F - Acquiring rights in property - period of holding of capital asset for the purposes of classification of capital gains is to be seen with reference to date of allotment of land or from the date of formal execution of sale deed for registration - as per assessee letter of allotment issued by BDA in respect of land parcel (Site no. 37) in question has given effective right to the assessee to assert its command on the asset which right is includible in the expression ‘property’ for the purpose of s.2(14) - whether letter of allotment would give effective right over the capital asset pending execution of formal agreement spelling out all the exact terms and conditions for acquisition? - HELD THAT:- Hon’ble Bombay High Court in the case of PCIT vs. Vembu Vaidyanathan [2019 (1) TMI 1361 - BOMBAY HIGH COURT] has taken note of CBDT circular no. 471 dated 15th October 1986 as well as CBDT circular 672 dated 16th Dec. 1993 and concluded that the assessee shall be deemed to have acquired rights in the property on the date of issue of allotment letter for the purposes of expression ‘capital asset’. Assessee in the instant case has not only been issued allotment letter, he has also made full payment to the authority concerned immediately thereafter. Thus, the asset is required to be held as long term capital asset even if the later date of payment is reckoned. Hence, the gains arising on sale of such asset has been correctly claimed as ‘Long term capital gains.’ Consequently, all the benefits flowing from such gains would be entitled to the assessee. - Decided in favour of assessee.
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