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Showing 501 to 520 of 994 Records
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2013 (4) TMI 499 - PUNJAB AND HARYANA HIGH COURT
Exemption u/s 54F - Sale of gricultural land and residential house - The assessee purchased a residential house from the sale proceeds so received - Held that:- subsection(4) of Section 139 of the Act is in fact a proviso to Section 139(1) of the Act - Therefore, since the assessee has invested the sale proceeds in a residential house within the extended period of limitation, the capital gain is not payable.
The judgments in Rajesh Kumar Jalan’s case (2006 (8) TMI 126 - GAUHATI High Court) and Fathima Bai’s case (2008 (10) TMI 563 - KARNATAKA HIGH COURT ) were referred too.
In the present case, the assessee has proved the payment of substantial amount of sale consideration for purchase of a residential property on or before 31.3.2008, that is within extended period of limitation of filing of return. Only a sum of Rs.24 lacs was paid out of total sale consideration of Rs. Two Crores on 23.4.2008, though possession was delivered to the assessee on execution of the power of attorney on 30.3.2008 - Since the assessee, has acquired a residential house before the end of the next Financial Year in which sale has taken place, therefore, the assessee is not liable to pay any capital gain. Such is the view taken by the Income Tax Appellate Tribunal - Decided in favor of assessee.
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2013 (4) TMI 498 - ALLAHABAD HIGH COURT
Reopening of assessment – stock transfer – A.O. submitted that petitioner has claimed the stock transfer through form F to its branches at Punjab, Rajasthan and Delhi which was accepted in the assessment order but these branches were not disclosed in the application for granting registration under the Central Sales Tax Act therefore, liable to pay CST @ rate of 10% and order u/s 21(2) has been passed.
Petitioner submitted section 6-A lays down that the burden to prove is on the assessee to show that the goods did not move in pursuance of any contract, which has been discharged by the petitioner by filing form 'F'. No illegality or irregularity of any kind has been found in the form submitted by the petitioner. There being no dispute with regard to the genuineness of the form F, no case for reopening the assessment under section 21 of the U.P. Trade Tax Act has been made out.
Held that –We find that the case of the respondents lacks any allegation of fraud against the petitioner after considering the provisions of sub-section (1) of section 6A. The genuineness or correctness of the form issued by its branches situate outside the State of U.P., who had obtained the form F from their registering authority is not an issue. After all form F is a document to prove that the goods were not moved in pursuance of contract of sale from one State to another. There is no dispute that the forms were not issued by the branches of the petitioner. It is a different thing to say that the factum of existence of branches were not disclosed in the registration application. The law does not provide that in such matters, the contention of dealer with regard to the stock transfer is liable to be rejected. In this facs situation, we fail to understand as to how it can be said that the turnover of the petitioner has escaped the assessment within the meaning of section 21 of the U.P. Trade Tax Act. petitioner is right in his submission that the impugned order granting sanction to reopen the assessment is no order in the eyes of law. The impugned order is bad and cannot be allowed to stand. The writ petition succeeds and is allowed.
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2013 (4) TMI 497 - ALLAHABAD HIGH COURT
Vat tax on sale of forms not paid - U.P. VAT Act, 2008 - The petitioner, a University, established under the provisions of U.P. State Universities Act, 1973 - whether the petitioner is a 'dealer' within the meaning of section 2(h) and is carrying on the business within the meaning of section 2(e), of the Act - Held that:- If the main activity of the petitioner is business or not, is the decisive factor to answer the question whether the person is dealer for incidental or ancillary activity.
Imparting education is a mission. Right to education, in the context of Articles 45, 41 means (a) every child/citizen of this country has a right to free education until he completes the age of fourteen years and (b) if a child or citizen completes the age of 14 years the State shall make effective provision or securing the right to work and education within the limits of its economic capacity and development.
The aims of education has been recognized by the Indian Courts from time to time. Education is perhaps most important function of State and Local Self Governments. It is unthinkable and beyond imagination to treat the imparting of education as business. The relationship in between teacher and one taught is not a business relation. The idea and purpose of imparting education is to develop personality of the students to carry the nation forward and in right direction.
Considering the case of Commissioner Of Sales Tax Versus Sai Publication Fund [2002 (3) TMI 45 - SUPREME Court] if the main activity is "non-business" and activity of buying and selling which forms part of an integral part of the non-business activity then also the party will not be a dealer. Thus the petitioner is not a dealer within the meaning of section 2(h) & its activity of printing and selling of admission forms to the students does not amount to business within the meaning of section 2(e) of the Act.
In the result, the writ petition succeeds - In favour of assessee.
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2013 (4) TMI 496 - ALLAHABAD HIGH COURT
Rate of tax on product 'Himgange Ayurvedic Oil' - U.P Trade Tax Act and Central Sales Tax Act - reopen the assessment under section 21(2) of the U.P Trade Tax Act as the commodity in question should have been taxed as unclassified item and not as Ayurvedic preparation - Held that:- For the assessment year 2006-2007, this has been held that 'Himgange Oil' falls under the category medicine and not cosmetic. The said judgment is binding on the respondents herein. Moreover there is no denial at any stage by the respondents with regard to the contents of the product or its manufacturing process which leads to the conclusion that the product is an Ayurvedic product. It has been found so even by National Laboratory on examination.
The basis of the impugned order dated 2.3.2012 granting sanction under section 21(2) is the survey dated 27.8.2009, conducted by SIB, the product was sent for its testing and in the opinion of the surveying officer, the 'Himgange Oil' does not come under the category of medicine. It was found otherwise. The report of the Laboratory has come and the assessing officer on the basis of the test report has treated 'Himgange Oil' as an Ayurvedic preparation.
Upshot of the above discussions is that, except for these two assessment years the product has been treated as Ayurvedic preparation and the said finding has been approved by the High Court inter parties as discussed herein above.
Thus absolutely no justification either for granting the permission to reopen the assessment for the assessment year 2006-2007 or to issue any show cause notice under section 21(2) for the assessment year 2005-2006. In favour of assessee.
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2013 (4) TMI 495 - CESTAT NEW DELHI
Architect’s service - short payment of service tax - the only ground taken by the appellant is availability of receipts in respect of ammonia printing charges, model making charges and perspective drawing now at this stage of appeal - Held that:- Appellant did not produce these receipts before any of lower authority though these receipts were issued by them only and there cannot be any reason for not producing the same before lower authority. Thus these receipts are not supported by any other documents like invoices. Under Section 67 or the Finance Act, 1994 service tax is to be paid on gross value of service provided. Appellant has received these charges from service recipient and therefore liable to pay service tax on these charges. Against assessee.
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2013 (4) TMI 494 - CESTAT NEW DELHI
Refund claim rejected to the extent of 50% - as per dept. containers employed by the assessee for transportation of specified goods from the place of manufacture to the export terminal were paid by series of single invoices, which included freight charges for onward transportation for export as well as return of the empty containers to the factory premises - Held that:- As decided in C.C.E., Madurai vs. Tata Coffee Ld. (2010 (11) TMI 364 - CESTAT, CHENNAI), Balkrishna Industries Ltd. vs. C.C.E., Aurangabad (2012 (5) TMI 445 - CESTAT, MUMBAI) & Garware Polyester Ltd. vs. C.C.E., Aurangabad 2011- IST 400 (CESTAT Mum) have consistently taken the view that inasmuch as the entirety of the said activity is in relation to the transportation of export of the specified goods, refunds claimed in entirety are liable to be paid, in terms of the Notifications No.17/2009-ST dated 7.7.2009 as amended by the Notification No.40/2009-ST dated 30.9.2009..
No reason to conclude otherwise, as the reasons recorded in the decisions referred are consistent with a true and fair interpretation of both the Notifications - assesee is declared entitled to refunds as claimed.
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2013 (4) TMI 493 - CESTAT NEW DELHI
Cenvat credit denied - assessee is in the business of providing management consultancy services - employees insurance - Held that:- Cenvat credit availed in respect of employees insurance was upheld in decisions of India Gateway Terminal (P) Ltd. Vs. CCE, Cochin 2010 [2010 (6) TMI 464 - CESTAT, BANGALORE], Stanzen Toyotetsu India Pvt. Ltd. Vs. CCE Bangalore [2008 (12) TMI 118 - CESTAT BANGLORE], CCE Raipur Vs. Raipur Rotocast Ltd. (2009 (7) TMI 568 - CESTAT, NEW DELHI) & Flamm Minda Automotive Ltd. Vs. CCE Delhi [2011 (1) TMI 246 - CESTAT, NEW DELHI].
Cenvat credit on cab hire services - Held that:- As decided in CCE, Bangalore-III Vs. Tata Auto Comp. Systems Ltd. (2009 (4) TMI 555 - KARNATAKA HIGH COURT) answering the substantial question framed in favour of the assessee, reiterated that transportation/rent-a-cab service provided by the employer to its employees in order to reach the factory premises in time has a direct bearing on the manufacturing activity and cannot be construed as a mere welfare measure nor availment of Cenvat credit denied on that assumption.
Car parking facility has been held to constitute input service in relation to the business of mandap keeper service as decided in Desert Inn Limited Vs. CCE, Jaipur 2011 [2011 (3) TMI 640 - CESTAT, NEW DELHI].
Cenvat credit for service tax in respect of services including maintenance and repairs of the fly ash plant situated with the Thermal Power Plant located outside the factory premises decided in favour of assessee as relying on CCE, Nagpur Vs. Ultratech Cement Ltd. {2010 (7) TMI 302 - CESTAT, MUMBAI]rejected Revenue’s appeal and ruled in favour of the assessee with regard to the legitimacy of availment of. In favour of assessee.
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2013 (4) TMI 492 - CESTAT NEW DELHI
Exemption under Notification No.32/2004 dated 3.12.2004 denied - as per dept exemption extends only to a service provider and not to any other person - - Held that:- As decided in Shree Rajasthan Syntex vs. Commissioner of Central Excise, Jaipur (2011 (8) TMI 265 - CESTAT, NEW DELHI) relying on Visaka Industries Ltd. case (2007 (7) TMI 32 - CESTAT, MUMBAI) & Nahar Industries Enterprises (2007 (3) TMI 201 - CESTAT NEW DELHI) which was confirmed by the Punjab & Haryana High Court consistently following the view that assessees are eligible to pay tax on GTA services received from their Cenvat Credit Account. It was further held that prior to the Notification dated 01.03.2008, the issue stands decided in favour of the appellant by several judgments and cenvat credit could be utilised towards service tax in respect of services received from GTA, in view of the deeming fiction in Rule 2(r) whereunder the service recipient is defined to be different service provider, if liable to service tax. In favour of assessee.
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2013 (4) TMI 491 - CESTAT NEW DELHI
Scrutiny of service tax return - short payment of service tax observed - period Oct 05 to Mar 06 - Held that:- The case was rejected by the lower authority on the ground of no submission of relevant documents for verification of availment of Cenvat Credit. In view of facts that appellant has produced the relevant invoice/document showing the payment of service tax matter is remanded to original authority for verification of the same and for deciding the matter afresh after giving an opportunity to hearing to the appellant. Appeal is allowed by way of remand.
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2013 (4) TMI 490 - MADRAS HIGH COURT
Deemed registration u/s 12AA - Whether Tribunal was right in setting aside the order of the CIT as the order was not passed within six months from the date of filing without appreciating the said time limit prescribed was only directory and not mandatory - Held that:- In the matter of Commissioner of Income Tax I, Salem v. Sheela Christian Charitable Trust(2013 (3) TMI 268 - MADRAS HIGH COURT), wherein by following the decision of this Court reported in Director of Income Tax (Exemption) v. Anjuman-E-Khyrkhah-E-Aam)(2010 (12) TMI 957 - Madras High Court )- We held that there is no automatic or deemed registration if the application filed U/s 12AA was not disposed of within the stipulated period of six months - We further held therein that the time frame fixed under the said provision is only directory.
On merits - The Commissioner of Income Tax held that there is no element of charity involved in the process of money lending by the Assessee Company and the activity of Assessee Company is not of charitable nature.
The order of the Tribunal is set aside and the matter is remitted back to Commissioner of Income Tax, Salem for consideration of the matter afresh - The appeal is allowed. The Commissioner of Income Tax, Salem shall consider the Assessee's application afresh and afford sufficient opportunity to the Assessee Company and pass orders - The question of law is answered accordingly.
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2013 (4) TMI 489 - DELHI HIGH COURT
Notice U/s 148 - Amendment made to Section 115JB of the Act by the Finance Act, 2008 with retrospective effect -Held that:- The Court merely noticed that it was held by the Supreme Court in M.K. Venkatachalam Vs. Bombay Dyeing & Manufacturing Co. Ltd.(1958 (4) TMI 4 - SUPREME Court ) that a retrospective amendment of law can even permit action for rectification of the assessment on the ground of mistake apparent from record. This Court held that just because action for rectification is permissible, it does not mean that no action can be taken for re-opening the assessment because the powers under Section 147 and Section 154 are not mutually exclusive and there could be some overlapping and so long as the conditions for the applicability of either of these sections are satisfied. The petitioner does not appear to have properly understood and appreciated the purport of our observation.
We have only pointed out that “there could be overlapping of jurisdiction and so long as the jurisdictional pre conditions are satisfied, action can be taken by the assessing officer under the appropriate section even though action could be taken under another Section.” The argument of the petitioner that action can only be taken under Section 154 did not appeal to this Court, and was rejected - The petitioner has also prayed for recalling the direction imposing cost. We do not find any merit in the same - The prayer is rejected - we find no merit in the review petition which is dismissed with no order as to costs.
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2013 (4) TMI 488 - BOMBAY HIGH COURT
Amended provisions of Section 80IB (10) - Section 2(22)(e) - Deduction U/s 80IA(4)(iii) - Held that:- The Tribunal, on examination of all facts concluded that all the requisite conditions for claiming benefit under Section 80IA(4)(iii) of the Act has been complied with by the respondent - assessee during the assessment year in question - Further, there is no reason to hold the benefit under Section 80IA(4)(iii) of the Act is available only prospectively from the date of the issue of Notification by the CBDT.
In these circumstances, as the decision of the Tribunal is based on finding of fact and mere delay on the part of the Central Board of Direct Taxes in issuing the notification would not warrant the respondent - assessee being denied the benefit of Section 80IA(4)(iii) - This is so, particularly when the Revenue has not been able to point out any infirmity in the approval as granted by the Ministry for Commerce and Industry recognizing the respondent - assessee as industrial park - The view of the Commissioner of Income Tax (A) and the Tribunal is a reasonable view in the facts of the case and thus we see no reason to entertain question regarding Section 80IA(4)(iii).
The appeal is admitted on questions amended provisions of Section 80IB (10) and Section 2(22)(e).
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2013 (4) TMI 487 - ITAT MUMBAI
Disallowance of expenditure related to Exemption u/s. 10(36) in respect of dividend income - Section 14A - Disallowance Under Rule 8D - Held that:- The question arising in the present appeal is primarily of fact, i.e., the amount of indirect expenditure by way of administration expenses that can be reasonably attributed to the exempt - The orders of both the authorities are silent in the matter - The Revenue has also not brought on record its figure, with reference to which only, coupled withother relevant information, the reasonability or otherwise of the disallowance, which is being impugned by the Revenue, could be adjudged by us.
The disallowance at Rs.10,000/-, which works to 6.17% of the exempt income, cannot be held as unreasonable, particularly considering that there is nothing adverse on record, and the fact that the tribunal has in the cited cases found a disallowance at as low as 2% to 5% of such (exempt) income as sustainable. No interference with the impugned order is, therefore, called for. We decide accordingly.
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2013 (4) TMI 486 - BOMBAY HIGH COURT
Determination of Arms Length Price - Whether Tribunal was correct in holding that comparable selected by the TPO were not functionally comparable while determining ALP - Held that:- In the impugned order the Tribunal has in detail pointed out why the selected comparables are not proper and failure of the assessing officer to consider the objections of the assessee - In this view of the matter, we see no reason to entertain the Appeal.
Whether Tribunal was correct in allowing safe harbor margin of (+/-) to the assessee - Held that:- It becomes academic as if the eight comparables selected by the TPO are found not to be functionally comparable then the difference between the operating margin of the respondent at 15.05% as against the 18.97% of comparable companies being within the range of +/ - 5% the amounts received by the respondent - Assessee is within the statutory limits. Therefore, we see no reason to entertain this appeal - Revenue's appeal is dismissed with no order as to costs.
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2013 (4) TMI 485 - ITAT BANGALORE
Penalty u/s. 271(1)(c) - concealment of particulars - bifurcating the income on which tax sought to be evaded - income surrendered during survey - difference between assessed income and returned income - Held that:- There can be no concealment or non-disclosure, as the assessee had made a complete disclosure in the IT return and offered the surrendered amount for the purposes of tax and therefore no penalty under s. 271(1)(c) could be levied. The words 'in the course of any proceedings under this Act' in Sec. 271(1)(c ) of the Act are prefaced by the satisfaction of the AO or the CIT(A). When a survey is conducted by a survey team, the question of satisfaction of AO or the CIT(A) or the CIT does not arise. One has to keep in mind that it is the AO who initiates penalty proceedings and directs the payment of penalty. He cannot record any satisfaction during the course of survey. Decision to initiate penalty proceedings is taken while making assessment order. It is, thus, obvious that the expression 'in the course of any proceedings under this Act' cannot have the reference to survey proceedings.
There can be no justification for imposition of penalty on the income offered in the return of income by the Assessee for both the A.Ys., because there cannot be any penalty on income which is declared in a return of income, on the facts and circumstances of the present case.
Penalty - difference between assessed income and returned income - held that:- Assessee was that it was due to inadvertence that the income declared in the return of income was less than what was offered at the time of survey. - the estimation of income is not on any incriminating material but based on agreement between the revenue and the Assessee at the time of survey. In respect of such addition, for which a bona fide explanation has been given by the Assessee, no penalty can be imposed.
The law is well settled that an Explanation inserted in a penal provision cannot be regarded as a substantive provision by itself and such an Explanation can only be regarded as a rule of procedure and a rule of evidence leaving it to the assessee and the Revenue to adopt the same as the basis to substantiate their rival claims having regard to the facts of the case and the law applicable. - No penalty - Decided in favor of assessee.
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2013 (4) TMI 484 - MADHYA PRADESH HIGH COURT
Section 250 - Stay of recovery - Coercive measures - Attached the bank account - Held that:- As per Section 250 (6A) specifically provides that during the pendency of this petition, the Assessee should not be treated as defaulter and apparently the action has been taken by the respondent No.1 for recovery of the dues against the petitioner during the pendency of the appeal - So far as Section 250(6A) of the Act is concerned, it provides that the appellate authority shall make an endeavour to decide the appeal within a period of one year from the end of the financial year in which such appeal was filed. The aforesaid provision also put an obligation on respondent No.2 to decide the appeal expeditiously.
Petitioner shall move an application before the respondent No.2 to decide the appeal - The respondent No.2 on filing of such an application shall consider and decide the application for stay expeditiously as far as possible within a period of 30 days from the date of filing of such an application and shall further make an endeavour to decide the appeal itself as far as possible within a period of 6 months from the date of filing of such an application - Respondent No.1 shall not take any coercive action and shall await the decision of respondent No.2 on the stay application and during this period, the respondent No.1 shall release the Bank account of the petitioner and the amount transmitted to the Revenue, shall be subject to decision of appeal by the respondent No.2 - It is made clear that this Court has not expressed any opinion on the merits of the case and the respondent No.2 shall be free to decide the appeal and the stay application in accordance with law.
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2013 (4) TMI 483 - UTTARAKHAND HIGH COURT
Appeal against the Stay of demand by the tribunal - recovery - held that:- The above order was passed on 14.02.2013 and the department could wait from 14.02.2013 till today, therefore, the element of urgency has been allowed to be diluted by the department itself. If I grant any interim stay of the impugned order that amounts to deciding the writ petition finally without giving opportunity of hearing to the respondent. That is not possible in any sense.
Tribunal directed to complete the hearing on 2nd April, 2013, if possible. If not possible then day to day hearing is to be taken and the matter should be decided at an early date.
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2013 (4) TMI 482 - CESTAT NEW DELHI - LB
Education/S&H cess - Goods cleared by 100% EOU into DTA - double taxation - whether education cess and S&H Cess is to be levied again in respect of DTA clearances of a 100% EOU on the aggregate of the duties of customs which already includes the education cess and S&H cess?
Held that – Sections 93 & 94 of Finance Act, 2004 and Sections 138 and 139 of Finance Act, 2007 while defining the measure of education cess and S&H cess in respect of excisable goods and imported goods respectively, specifically provide that the aggregate of duties of excise or aggregate of duties of customs levied by the Central Government , on which this cess is to be levied as surcharge, would not include the education cess and S&H cess. Thus, the intention of the legislature was never to charge education cess on education cess. In fact this is not permissible from very mode of this levy as prescribed in Section 91 of the Finance Act, 2004 and Section 136 of the Finance Act, 2007, as when a new tax is introduced as surcharge on the existing levies, the base on which the new levy as surcharge is to be calculated will include only the existing levies, not the new levy.
As decided by the Apex court in the Jain Brothers v. U.O.I., reported in [1969 (11) TMI 1] has held that there can be no objection for double taxation if the legislature has distinctly enacted it, but while interpreting general words of taxation, the same cannot be so interpreted as to tax the subject twice over to the same tax. Thus, this principle which has to be kept in mind while calculating education cess and S&H cess on DTA clearances of a 100% EOU. Since the DTA clearance of a 100% EOU attract central excise duty and in terms of proviso to Section 3(1) of Central Excise Act, 1944, the measure of the excise duty leviable is aggregate of duties of customs charged on import of like goods into India under Customs Act, 1962 read with Indian Customs Tariff Act, 1975 or any other law for the time being in force, this aggregate of duties of customs on which education cess under Section 93 of Finance Act, 2004 and S&H cess under Section 138 of Finance Act, 2007 is to be charged, would not include education cess and S&H cess under Section 94 of Finance Act, 2004 and Section 139 of Finance Act, 2007. In other words, the education cess and S&H cess would be chargeable only once under Section 93 of Finance Act, 2004 and Section 138 of Finance Act, 2007 on the sum of basic customs duty and Additional customs duty.
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2013 (4) TMI 481 - GUJARAT HIGH COURT
Eduction cess (for the third time) on the aggregate of the duties of the customs - whether a Tribunal is justified in holding that the education cess is not leviable under Section 93 (1) of the Finance Act, 2004 upon the 100% EOU in clearance of DTA? - Notification No. 23/03 CE dated 31.03.2003 ignored by Tribunal - Maintainability of appeal - Held that:- Exclusion clause in sub-section (1) of Section 35G is worded in an expansive manner and excludes all appeals arising out of orders of the Tribunal relating among other thing to the determination of any question having a relation to the rate of duty of excise. What is excluded from the purview of the High Court's jurisdiction is not merely an order of Tribunal which decides the rate of duty of excise but any order which concerns determination of any question which has relation to such rate of duty of excise. Expression “any question having a relation to the rate of duty” is a wide one.
Whether the manufacturers are required to pay education cess on the computation of the customs duty and the CVD on which, once they have already paid such education cess Tribunal ruled in favour of the manufacturers and rejected the Revenue's case that such education cess was required to be paid once again. Thus such decision of the Tribunal would certainly be covered under the expression "the order determining a question having relation to the rate of duty of excise". If the Department is correct in its stand, the manufacturers would have to pay excise duty at a rate higher than what they have been paying. Computation of excise duty would have to include component of education cess . On the other hand, if the manufacturers are correct in their stand, such education cess would be excluded. In any case, it would have a direct bearing on the rate at which manufacturers should pay the excise duty on their clearances in the DTA from EOU Units. In that view of the matter, the respondents' preliminary objection is required to be upheld.
Question having relation to the rate of duty of excise or to the value of goods for the purposes assessment lies to the Supreme Court under Section 35L (b) the Act and not to the High Court under Section 35(G).
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2013 (4) TMI 480 - ITAT, MUMBAI
Reassessment - Conversion of land into stock in trade - development and construction of building - the claim of the assessee of having converted the capital asset of land into stock in trade for the purpose of his business as envisaged in sec. 45(2) was not accepted by the AO as well as by the ld. CIT(A) mainly for the reason that there was no business of real estate development actually commenced or carried on by the assessee and it was a case of transfer of land as capital asset simpliciter as per the Development Agreement. - held that:- The decision of Hon’ble Bombay High Court in the case of Ms. Malavika Arun Somaiya (supra) is directly on the issue involved in the present case - the re-assessment made by the AO u/s. 143(3) read with sec. 147 without issuing notice u/s. 143(2) is invalid. We, therefore, cancel the said assessment and allow the additional ground raised by the assessee.
A comparative analysis of the present case and the case of Vidhyavihar Containers Ltd. vs. Deputy Commissioner of Income Tax [ 2011 (10) TMI 240 – ITAT MUMBAI] decided by the Tribunal clearly shows that the material facts relating to the issue under consideration as involved in both these cases are similar in which both the sides had taken similar position. The Tribunal finally accepted the stand of the assessee for the elaborate reasons given in its order in the case of Vidhyavihar Containers Ltd. - there was a conversion of land by the assessee into stock in trade on 15-05-2002 within the meaning of sec. 45(2) and as per the said provision, the profits or gains arising from the transfer by way of such conversion were chargeable to tax as the income of the assessee under the head “capital gains” in the year in which the stock in trade was sold by the assessee. - Decided in favor of assessee.
Determination of the year in which capital gain arising from the transfer of land by way of conversion into stock in trade is chargeable to tax. - Held that – Here tribunal made the consideration on the case decided by the Co-ordinate Bench of the Tribunal in the case of Dy.CIT vs. Crest Hotels Ltd. [2000 (2) TMI 788 - ITAT MUMBAI] wherein the capital asset comprising of land and building of the hotel business was converted by the assessee into stock in trade of the construction business. Tribunal hold, respectfully following the decision of the Co-ordinate Bench of the Tribunal in the case of Crest Hotels Ltd. (supra), that the capital gain on transfer of capital asset by way of conversion is chargeable to tax in assessment year 2005-06 as per the provisions of sec. 45(2). - Decided in favor of assessee.
Determination of cost of acquisition of Sanpada plot for the purpose of computing long-term capital gains. - Held that - A similar issue had come up for consideration before the Co-ordinate Bench of the Tribunal in the case of Atul G. Puranik vs. ITO [2011 (5) TMI 576 – ITAT], Mumbai wherein a similar plot of land was allotted to the assessee as compensation in lieu of agricultural land acquired by the Government under the same scheme called “12.5% scheme” and the issue was determination of cost of acquisition of the said plot of land for the purpose of computing capital gains. The ratio of the decision of the Tribunal in the case of Atul G. Puranik is thus squarely applicable to the issue involved in the present case and respectfully following the same, we direct the AO to take the cost of acquisition of the land of the assessee for the purpose of computing capital gain at Rs.1,07,90,000/-, being the market value of the said land on the date of allotment. - Decided in favor of assessee.
Dtermination of sale - Held that - Consideration of land to be taken for the purpose of computing capital gain. In the present case, the fair market value of land on the date of conversion at Rs.2,49,00,000/- was taken by the assessee as the full value of consideration for the purpose of computing capital gain and since the same was in accordance with the provisions of sec. 45(2), we are of the view that the same should be accepted. In that view of the matter, we direct the AO to adopt the fair market value of land at Rs.2,49,00,000/- as the full value of consideration for the purpose of computing capital gain as claimed by the assessee. Ground no. 4 of the assessee’s appeal is accordingly allowed. - Decided in favor of assessee.
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