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2022 (4) TMI 672 - AT - Income TaxCapital gain computation - cost of acquisition of the immovable property sold as claimed by the assessee at ₹ 250/- per sq. yard being the fair market value as on 01.04.1981 - HELD THAT:- A perusal of the relevant findings/observations recorded by the learned PCIT in the order passed under Section 263 clearly shows that the similar issue was examined by him in the light of the submissions made on behalf of the assessee as well as the fresh valuation report of another Govt. approved Registered Valuer submitted by the assessee. After taking into consideration this relevant documentary evidence, the learned PCIT arrived at a conclusion that the value of land in question as on 01.04.1981 taken by the Assessing Officer cannot be taken at ₹ 80/- per sq. yard as the same was not proper considering the location of land, its distance from Airport, Railway line etc. He found that the value adopted by the Assessing Officer at ₹ 250/- per sq. yard was neither less nor more and it was reasonable considering the location and other factors like proximity distance from Airport, Railway line etc. In this regard, he also derived support from the valuation report of another approved valuer submitted by the assessee wherein the rates of ₹ 350/- per sq. yard, ₹ 400/- per sq. yard and ₹ 210/- per sq. yard were quoted as comparable instances. In our opinion, the similar issue thus has already been decided on merit by the learned PCIT in the case of Shri Yogeshbhai Laxmanbhai Makwana, one of the co-owners of the property in question, after taking into consideration all the relevant aspects and we do not find any justifiable reason to take a different view in the matter. We accordingly direct the Assessing Officer to adopt the rate of ₹ 250/- per sq. yard as the cost of acquisition as on 01.04.1981 being the fair market value of the property in question while computing the Long Term Capital Gain and allow Ground No.2 of the assessee’s appeal. Area of land to be taken into consideration for determining cost of acquisition to be deducted while computing Long Term Capital Gain - HELD THAT:- We are of the view that what is to be considered for the purpose of computing the cost of acquisition which is deductible while computing the Long Term Capital Gain is the area of 5954 sq. yard of land which is actually transferred by the assessee and other co-owners to the purchaser and not the total area of land of 8470 sq. yards as originally acquired by them. In that view of the matter, we uphold the impugned order of the learned CIT(A) on this issue and dismiss Ground No.3 of the assessee’s appeal. Whether the property sold by the assessee was comprising of any residential or commercial construction as claimed by the assessee? - HELD THAT:- As already noted that the findings recorded by the Assessing Officer as well as by the learned CIT(A) on the basis of the relevant documentary evidences especially the banakhat and final sale deed are sufficient to show that what was transferred by the assessee was only the non-agricultural open land and there was no transfer of any residential or commercial construction. The deduction on account of cost of acquisition is to be allowed with reference to the property sold or transferred by the assessee and since there is nothing on record to conclusively prove that the residential and commercial construction was also transferred by the assessee, we find ourselves in agreement with the authorities below that what was transferred or sold by the assessee was only the non-agricultural open land and the assessee, therefore, was not entitled for deduction on account of cost of acquisition of residential and commercial construction. Ground No.4 of the assessee’s appeal is accordingly dismissed. Claim for deduction under Section 54 on account of investment made in residential house - HELD THAT:- As agreed by the learned representatives of both the sides, this issue is consequential to the issue involved in Ground no.4 of this appeal and since the same has already been decided by us against the assessee by holding that what was transferred by the assessee was the non-agricultural open land without there being any construction of residential house thereon. Following this conclusion drawn by us, we hold that the assessee is not entitled for exemption under Section 54 of the Act, but he is entitled for exemption under Section 54F as allowed by the authorities below. Ground No.5 of the assessee’s appeal is accordingly dismissed.
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