TMI Blog2015 (10) TMI 2107X X X X Extracts X X X X X X X X Extracts X X X X ..... t for want of acquisition cost, capital gains tax would not arise. Since a direct decision of the Hon’ble jurisdictional Court in relation to the chargeability of capital gain on asset acquired by way of adverse possession is available, hence, the same is binding upon this Tribunal. We therefore hold that no capital gain are chargeable to tax in relation to the asset acquired by way of adverse possession. - Decided in favour of assessee. - I.T.A. No. 807/Mum/2013 - - - Dated:- 11-9-2015 - SHRI R.C. SHARMA, ACCOUNTANT MEMBER AND SHRI SANJAY GARG, JUDICIAL MEMBER For The Appellant : Shri Nandgaonkar For The Respondent : Shri Neil Philip (DR) ORDER PER SANJAY GARG, JUDICIAL MEMBER: This appeal filed by the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Nagari Nivara Parishad, the owner of the land filed civil suit Nos.1251, 1252 and 1253 of 1991 against the above stated three persons. A consent decree dated 13.7.1999 was passed by Bombay City Civil Court whereby the said three persons got absolute rights over 2000 sq. meters of land out of the 62 acres of land allotted to the trust Nagari Nivara Parishad . On the application made by the Shettys, the City Survey Officer also transferred the property in their names. Subsequently, the Shettys entered into a Development Agreement dated 24.8.2005 with M/s Hekunt Real Estates P Ltd and received consideration of ₹ 1.20 crores and a flat of 2000 sq. ft. (carpet area) was further to be given to Shettys within 20 months from the date of gran ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ore A.Y. 1995-96, the Courts had held that capital gain tax was not chargeable where the cost of acquisition was nil or not ascertainable. The facts of these case laws were completely different from the facts of the assessee, where the cost of acquisition was although nil but it was fully ascertainable. He relied in this respect upon the decision of the Ahmedabad Special Bench in the case of Vijay Singh R. Rathod Others Vs. ITO, 106 ITD 153 (Ahd) (Special Bench). The Assessing Officer further observed that the assessee had been permitted to sell land to a Developer as owner and accordingly the sale deed had been executed. The possession of the land held by the assessee at the time of sale on 24.8.2005 to M/s. Hekunt Real Estate P. Ltd. wa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... required to be done in the value of the property adopted by the Stamp Duty Officer. The AO therefore held that though cost of acquisition of the ownership right was nil, yet, the assessee was liable for long term capital gains tax. The Assessing Officer thus adopted the value of ₹ 2,28,000/- as the sale consideration u/s 50C for the purpose of computation of capital gain. The Assessing Officer computed long term capital gain of ₹ 60,78,265. In appeal, the ld. CIT(A) confirmed the order of the AO . The assessee has thus come in appeal before us. 7. We have considered the rival contentions. We find that the issue is covered in favour of the assessee by a number of decisions of the Hon ble Supreme Court as well of various High ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8. Thus, it may be noted that after the amendment of 1995, certain assets like goodwill, tenancy rights etc. have been charged to tax by specifically providing that if there is no cost incurred by the assessee in this respect, the cost shall be taken as nil. However, we find that vide amendment, particular assets like goodwill, tenancy rights, trade mark etc. have been brought into the ambit of charging section. However, the rights obtained by way of adverse possession have not been included in the provision neither in the charging section 45 nor in the section 48 which provides mode of computation. There is no any provision regarding the charging of capital gains tax on an asset title to which has been acquired in recognition of rights of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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