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2017 (1) TMI 1765 - ITAT PUNEDisallowance u/s.14A r.w. Rule 8D of the I.T. Rules - Sufficiency of own funds - HELD THAT:- Since in the instant case admittedly the own capital of the assessee is much more than the investment towards capital in the partnership firms and shares of Indian Companies the income of which is exempt from tax, therefore no disallowance u/s.14A in the instant case is called for. We, therefore, set aside the order of the CIT(A) and direct the Assessing Officer to delete the disallowance made by him u/s.14A of the I.T. Act. Ground raised by the revenue is accordingly dismissed and the ground raised by the assessee on this issue is allowed. Addition of capital gain - transfer of the capital asset and performance of various obligations - Co-ownership in asset - HELD THAT:- Admittedly the assessee along with other co-owners was having land admeasuring 70 acres situated at Wagholi and was not having 108 acres of contiguous land that had been agreed upon to be sold at the relevant time. Further the sale deed contained certain obligations on the part of the assessee and the co-owners to be fulfilled and the assessee has received only 50% of the consideration during the impugned assessment year. We find from the letter addressed by Mr. Atul Chordia, Director of Wagholi Properties Pvt. Ltd.,in response to notice u/s.226(3) for recovery of dues in case of the assessee, he has categorically stated that the balance amount of ₹ 17.01 crores is payable only after fulfillment of certain conditions mentioned in the agreement. In our opinion, the contents of the agreement has to be read as a whole and the revenue cannot re-write the agreement. As in the instant case the right to receive the consideration is on fulfillment of certain obligations. Further, the assessee has offered the balance amount to tax in A.Y. 2014-15 as business income - we are of the considered opinion that assessee is liable to capital gain tax only on 50% of the consideration that has been received during the year. We, therefore, set aside the order of the CIT(A) and allow the grounds raised by the assessee.
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