TMI Blog2015 (2) TMI 197X X X X Extracts X X X X X X X X Extracts X X X X ..... actually transferred and hence no value was adopted by the Stamp Duty Authorities as the matter never went to Stamp Duty Authorities. Thus provisions of section 50C were not applicable. The Ld. CIT(A) has given a well reasoned finding regarding the non application of section 50C of the Act to the assessee’s case. The Ld. CIT(A) has also discussed that the Hon’ble High Court has decreed the plaint holding the assessee to be owner on the basis of agreement of the year 1973. Thus no infirmity in the order of the Ld. CIT(A) on the above issues. - Decided against revenue. Wrong offer to tax on capital gains on the conversion of capital asset to stock in trade by wrongly applying the provisions of section 45(2) - cross objection by assessee - Held that:- The Ld. CIT(A), after going through the evidences, has held that the assessee had entered into a development agreement on 28.06.04 with Shree Balaji Developers and thereby had conveyed the land for the purpose of development to the developer. He has held that such conveyance of land very much falls within the meaning of transfer under section 2(47) of the Act and the capital gains arising as per the provisions of section 45(2) were t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2003 and that the provisions of section 50C. are attracted. 2(b) The ld.CIT(A) erred in not appreciating that the vacant lands are not valued by the Valuation Cell and that the value as per Stamp Duty Ready Reckoner is a self contained testament as the A.O. has rightly adopted the market value for the purpose of calculation of capital gains by invoking the provisions of section 50C. 3 The ld.CIT(A) erred in upholding the value of the property as on 01.04.1981 at ₹ 23,83,825/- ignoring that the title of the property was under litigation / dispute at that point of time and t h e same was settled by the Hon'ble High Court order dt. 27.07.2000. 4. The appellant prays that the order of the CIT(A) on the above ground(s ) be set as ide and that of the Assessing Officer be restored. 5 The Appellant craves leave to amend or alter any ground or add a new ground which may be necessary. 3. The brief facts of the case are that the assessee was holding a factory building as its capital asset and was claiming depreciation upon it. The assessee converted the said capital asset to stock in trade on 01.04.01 and offered capital gain of ₹ 2,14,36,356/-. The asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rt objected to the admission of additional evidences. However, he reiterated his views as were given in the assessment order. The Ld. CIT(A), after taking into consideration the comments of the AO as well as the submission of the assessee, observed that the AO had not specifically asked the assessee to furnish the proof of conversion of the property from capital asset to stock in trade on 01.04.01. The assessee realised that the AO had rejected his claim of conversion of the property on 01.04.01 only after receipt of the assessment order. From the evidence on the file, the Ld. CIT(A) further observed that the AO for the first time on 27.12.12 only, put a query to the assessee as to why the revised return filed on 30.09.03 should not be treated as an afterthought. The said query of the AO was replied by the assessee vide letter dated 28.12.07. The assessee had immediately replied the letter. Since the assessment was getting time barred, the AO completed the assessment on 31.12.07 i.e. within the short span of three days after getting reply. The Ld. CIT(A) therefore agreed with the submissions of the assessee that no sufficient opportunity was granted by the AO to produce the volumin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ansfer in view of section 2(47)(iv) of the Act. Since the value of the land was never assessed by the Stamp Duty Authorities, hence the provisions of section 50C were not applicable and the AO had not got jurisdiction to suo-moto apply the provisions of section 50C on deemed transfer. Since no stamp duty was ever imposed by the Stamp Duty Authorities, hence the provisions of section 50C were not applicable. The Ld. CIT(A) further observed that the Hon ble High Court had passed decree on 27.07.2000 on the basis of agreement of sale made in the year 1973, hence the assessee could be held to be owner of the property since 01.04.81. He therefore held that the assessee was entitled to opt for the fair market value of the property as on 01.04.81. He therefore held that the date of conversion from capital asset to stock in trade be taken as 01.04.01 and further that the provisions of section 50C were not applicable and further that the assessee is entitled to adopt the fair market value as on 01.04.81 as cost of acquisition for the purpose of computing the capital gains. Aggrieved by the order of the Ld. CIT(A), the Revenue is in appeal before us. 6. A perusal of the above reproduced g ..... X X X X Extracts X X X X X X X X Extracts X X X X
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