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2018 (6) TMI 1514 - HC - Income TaxCost of acquisition of the asset - Mode of computation - sale of tenancy rights - Benefit of indexation - Cost of acquisition to be taken as NIL for Fair Market Value (FMV) as on 1.4.1981 - Scope of section 55(2)(a) and 55(2)(b) - Held that:- Section 55 (2)(b) of the Act is a residuary clause dealing with the cost of acquisition of the capital assets which are not covered by Section 55(2)(a). Capital asset in this case being tenancy rights is covered by Section 55(2)(a). Appellant cannot avail of Section 55(2)(b) of the Act. It is in the above context that the impugned order holds that the indexation by substituting cost of capital assets to the previous owners who acquired the property before 1st April, 1981 by the market value as on 1st April, 1981 which is specifically referred to in Section 55 (2)(b) (ii) of the Act, would have no application to determine the cost of acquisition of tenancy rights which was a subject matter of sale. Cost of acquisition of tenancy, cannot be substituted by the fair market value as on 1st April, 1981, restored the issue to the Assessing Officer for the limited purposes to determine the cost of acquisition. This, in terms of Section 55(3) i.e. cost of acquisition to the previous owners or the market value on the date on which the capital asset become the property of the previous owner for the purposes of determining the income chargeable under the head 'capital gain' in respect of the sale of tenancy rights. No impediment in the Appellants challenging the order passed by the Assessing Officer, before the Appellate Authorities, consequent to the remand by the impugned order of the Tribunal under the Act and in accordance with law. No liberty for the same is required.
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