Subscription   Feedback   New User   Login      
Tax Management India .com
TMI - Tax Management India. Com
Articles Highlights TMI Notes SMS News Newsletters Calendar Imp. Links Database Experts Contact us More....
Extracts
Home List
← Previous Next →

DCIT, 17 (2) , Mumbai Versus M/s. Damania & Sons And Vica-Versa

Allocation of cost of land - whether CIT(A) has erred in holding that there is no basis and justification to allocate ₹ 5,28,12,000/- towards the building? - adoption of cost of building - work out long term capital gain on transfer of leasehold rights on land - Held that:- AO has arbitrarily allocated the cost of land by taking into consideration the cost of the building overlooking the claim of the assessee that even if new construction has to be made in the same plinth area it cannot be .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ased industries with adjoining infrastructural facilities and hence it is improper to segregate a large chunk of consideration towards cost of building since the dominant object was to acquire the leasehold rights on the land. Under these circumstances we are of the view that the order passed by the learned CIT(A) on this aspect does not call for any interference - Decided against revenue.

Depreciation on the property held for more than 40 years - whether no depreciation was ever clai .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

the said calculation of the assessee arbitrarily assuming that the purchase cost would be more than ₹ 5 crores. In our considered opinion the matter deserves to be set aside to the file of the AO who is directed to verify the computation given by the assessee and if the cost of building as computed by the assessee is reasonable then the reasonable value can be estimated as on 01.04.1981 accordingly. Decided in favour of assessee allowed for statistical purposes. - ITA No. 3258/Mum/2012, C .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

cation to allocate ₹ 5,28,12,000/- towards the building. 2. On the facts and in the circumstances of the case and in law, the Ld. CIT(A) has erred in holding that the cost of building is to be taken at ₹ 87,12,170/- instead of ₹ 5,28,12,000/- as workout by Assessing Officer in a scientific way. 3. On the facts and in the circumstances of the case and in law, the Ld. CIT(A) has erred in directing the Assessing Officer to work out short term capital gain on building as per Sectio .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

orities." In the cross objections filed by the assessee it was contended that the CIT(A) erred in not allowing depreciation on the property which was held for more than 40 years and also submitted that the long term capital gains of 99 years lease should be calculated after taking into consideration the indexation value as on 01.04.1981 as prescribed in Section 55(2)(b) of the Act. 3. Facts necessary for disposal of the appeal are stated in brief. Assessee was engaged in the business of man .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

sessee and M/s. Meyer Organics P. Ltd. the assessee has assigned its leasehold rights in Plot No. B-22 together with the building constructed on it in the year 1966, situated in Thane Industrial area. This lease of land had been obtained from the Maharashtra Industrial Development Corporation (MIDC). Since it was an assignment of tenancy rights, the AO was of the view that there is no sale of land involved and as per the provisions of section 55(2)(a) of the I.T. Act the purchase price is to be .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ding in the year 1965 was approximately ₹ 67,000/-. In this regard the AO observed that the details of depreciation claimed on the building were not submitted and the assessee had also not submitted the separate consideration received for land and building. In fact in the deed of assignment the total consideration has been received on the leasehold rights and the building situated on it and the purchaser has paid an amount of ₹ 19,14,440/- to MIDC as differential premium. Notice unde .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ds of the assessee and the cost at the time of transfer by the assessee works out to ₹ 1,91,88,000/-. The AO observed that as per the provisions of section 55(2)(a) of the Act, in the case of tenancy rights, the purchase price is to be taken as the cost of acquisition and the market value as on 01.04.1981 is not allowed to be substituted. Despite the objection of the assessee he proceeded to compute the long term capital gains at ₹ 1,84,41,306/- and short term capital gains of ₹ .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

in the above calculation of differential premium. It was also brought to the notice of the learned CIT(A) that according to the Ready Reckoner issued by Government of India the market value of the land in that area was ₹ 1,557/- per sq.ft. Even if the prevailing rate was 30% to 40% higher, as under the new government policy IT industries are to be promoted in that zone, with double FSI and also other availability of infrastructure. The value of the land which is sold will be approximately .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

y the AO. The AO had taken the cost of construction at ₹ 8,000/- per sq.mt. For a building constructed in 1966 no person will purchase the same at that price. It was therefore submitted that the amount paid by the purchaser was on account of the land cost. 8. The learned CIT(A) examined the issue and observed that the Hon'ble Bombay High Court, in the case of D.K. Sandhu Bros. Chembur P. Ltd. 249 ITR 265 had considered identical issue wherein it was held that the tenancy right was a ca .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

building by paying ₹ 7.2 crores in addition to payment of a sum of ₹ 19,14,400/- towards differential premium to MIDC. In fact the AO called for information in respect of differential premium from MIDC wherein it was clarified that the Corporation has not considered the market value in above calculation of differential premium which highlights that the premium rates charged by MIDC is different from the actual market value. He also observed that the estimate made by the AO in arrivi .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

e building as per section 50 of the I.T. Act. 10. It could thus be seen that the learned CIT(A) allocated ₹ 5,28,12,000/- towards value of land and the balance towards cost of building. The Revenue challenged the order passed by the learned CIT(A) whereas in the cross objections the assessee contends that the market value as computed under section 55(2)(b) has to be taken into consideration in the case of the building, which is more than 40 years old. It is not in dispute that the building .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

y taking into consideration the cost of the building overlooking the claim of the assessee that even if new construction has to be made in the same plinth area it cannot be more than ₹ 87,00,000/-. The learned CIT(A) has correctly taken into consideration the fact that the MIDC has not taken into consideration the market value while calculating the differential premium. Since the leasehold rights were transferred to the purchaser at ₹ 7.20 crores, the learned CIT(A) had correctly tak .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

 

 

 

 

 

what is new what is new
  ↓     Latest Happenings     ↓  

Notification: Rate of exchange of conversion of the foreign currency with effect from 22th September, 2017

Forum: Trans1 return

News: Exchange Rate of Foreign Currency Relating To Imported and Export Goods Notified

Forum: Credit on Repair of Company Car & Its Insurance

Circular: Promote the officers of the Indian Revenue Service (Customs and Central Excise) to the grade of Principal commissioner of customs, GST & CX

Circular: Allocate the charges amongst the Members of the Central Board of Excise and Customs

Circular: Strategy for audits in 2017-18 consequent to GST - Audit by Central Excise and service Department to continue for the accounting year 2016-17 and for the past period

Circular: Appoint the IRS (C&CE) officers as Principal Commissioner (Revision Application) and ex-officio Additional Secretary

Circular: Time limit for filing intimation for composition levy under Rule 3(1) of the CGST Rules, 2017 extended to 16-8-2017

Circular: Extension of time limit for submitting the declaration in FORM GST TRAN-1 under rule 120A of the Central Goods and Service Tax Rules, 2017

Circular: C.B.E. & C. Advisory on Customs related matters on introduction of Goods and Services Tax regime

Circular: List of Reduced Tax Liabilities under GST regime in comparison to present combined Indirect Tax rates

Circular: Works Contract for construction of Flats, Complex — Builders to pass on GST benefit to buyer otherwise anti-profiteering provisions of Section 171 of GST Act to apply

Circular: Clarification regarding applicability of section 16 of the IGST Act, 2017, relating to zero rated supply for the purpose of Compensation Cess on exports – Regarding.

Circular: Clarification on Inter-state movement of various modes of conveyance, carrying goods or passengers or for repairs and maintenance- regarding

Forum: Duty Drawback & Input Credit - under GST

News: RBI Reference Rate for US $

Highlight: Addition u/s 23(1)(a) - deemed rent - once the property is let out and at any point of time this remained vacant during the same cannot be brought to tax under the head House properties income.

News: Haryana constitutes screening committee on anti-profiteering

Highlight: Valuation of imported goods - it is necessary to re-examine the matter of both license agreement as well as supply contract simultaneously, to see if the enhanced royalty was in the guise of adjustment of the price of components.

Notification: Levy of anti dumping duty on New/unused pneumatic radial tyres with or without tubes and/or flap of rubber (including tubeless tyres) having normal rim dia code above 16 originating in, or exported from China PR

Highlight: Cenvat credit availed on Club Membership for the Director is not admissible as it cannot be said to be remotely connected with the activity of manufacture

Circular: Amendments in Hand Book of Procedures 2015-20 –reg.

News: Jaitley asks biz not to wait till last day to file GST returns

Circular: Implementing Electronic Sealing for containers by exporters under self-sealing procedure prescribed by Circular 26/2017-Cus dated 1st July, 2017 and Circular 36/2017 dated 28 th August, 2017. — reg.

Article: 20 Things You must know about E Way Bills in GST Law

Article: ‘DUTY DRAWBACK’ CANNOT BE EQUATED WITH ‘REBATE OF DUTY’

Highlight: Notification regarding GST rate for branded cereal, pulses and flour

News: Notification regarding GST rate for branded cereal, pulses and flour

Highlight: Anti-dumping duty on import of bus/truck tyres from China

Highlight: Cabinet approves Extension of time period of the Scheme "Special Industry Initiative for J&K" (Sll J&K) - Udaan

Highlight: Non-payment of service tax - maintenance and repair charges - appellants had knowingly and deliberately shown the repair charges as job work charges to mislead about their taxability - demand confirmed.

Highlight: BAS - execution of the project of smart card for vehicle registration – implementing the SOC-VRC project - The fact that the Government has outsourced some part of the work and paid certain consideration for such outsourced work, does not make the activity subject to service tax.

News: Cabinet approves Extension of time period of the Scheme "Special Industry Initiative for J&K" (Sll J&K) - Udaan

Highlight: Constitution of National Anti-profiteering Authority (NAA) under GST-reg. - Trade Notice

Highlight: Amendments in Hand Book of Procedures 2015-20 –reg. - Various amendments are made in Chapter-4 of Hand Book of Procedures 2015-2020.

Circular: Constitution of National Anti-profiteering Authority (NAA) under GST-reg.

Highlight: Sharing of expenses - BAS - promotion of business of group companies - sharing of expenditure for common facilities cannot be treated as service by one to another in such arrangement.

News: RBI Reference Rate for US $

Article: Credit of unsold stock [Section 140(3)] - Actual Credit as well as Notional Credit - Part-I - GST Transitional provisions

Circular: Certain Clarifications sought on Construction Services provided in the Real Estate Sector – reg.

News: Anti-dumping duty on import of bus/truck tyres from China

News: Fast-track GST refund, else ₹ 65K cr may be stuck: Exporters

Highlight: It is open to the Settlement Commission to use best judgment in arrival of the figure. Nonetheless it has to explain the manner in which the best judgment figure has been arrived at by the Settlement Commission - HC

Highlight: Deemed dividend u/s 2(22)(e) - advances given to societies - in the absence of legal right of the assessee in the said society the amount advanced cannot be treated as deemed income.

Highlight: When electrical installations are treated as plant and machinery the depreciation has to be allowed @ 25% as per provisions contained u/s 32

TMI Note: Capital Gain - transfer of right in the land or transfer of land itself - addition u/s 50C - Harassment to the honest tax payers

Highlight: Option to avail composition scheme under GST by electronically filing an intimation in FORM GST CMP-02 and FORM GST ITC-03 upto 30-9-2017 - See Rule 3(3A)

TMI Note: Does ICDS apply for the purposes of computing exemption u/s 11 to 13.

Highlight: Voluntary Reporting of Estimated Current Income and Advance Tax Liability - CBDT issues draft notification



|| Home || Acts and Rules || Notifications || Circulars || Schedules || Tariff || Forms || Case Laws || Manuals ||

|| About us || Contact us || Disclaimer || Terms of Use || Privacy Policy || TMI Database || Members || Site Map ||

© Taxmanagementindia.com [A unit of MS Knowledge Processing Pvt. Ltd.] All rights reserved.

Go to Mobile Version