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2019 (3) TMI 145 - AT - Income TaxExemption u/s 80IB(10) - Appellant has contributed its land to the JDA for its development and the developer has made the investment in construction of flat - Whether before entering into this JDA, the capital asset was converted into stock-in-trade and capital gain on its transfer was also offered at the time of sale of flats? - HELD THAT:- Assessee shall be allowed for exemption under 80IB(10) with respect to the profit earned on sale of its flats. But during the course of hearing, a doubt was raised as to whether the assessee has converted his capital asset as a part of stock-in-trade before entering into JDA. As this aspect was never verified by the lower authorities though the assessee has placed the documentary evidence in support of his contentions, but it requires verification from the lower authorities. We are of the view that let this point be examined by the AO. If the assessee succeeds in demonstrating that land held as capital asset was converted into stock-in-trade before entering into JDA and the assessee itself has offered the capital gain accrued on conversion of capital asset into stock-in-trade while filing the return along with the claim of exemption of business profit earned on sale of flat of his share under section 80IB(10) of the Act. If the assessee succeeds in proving that capital asset was converted into stock-in-trade, before entering into JDA, claim of exemption of deduction under section 80IB(10) be allowed. - Decided in favour of assessee for statistical purposes.
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