TMI Blog2007 (5) TMI 106X X X X Extracts X X X X X X X X Extracts X X X X ..... n short as 'Tribunal') in ITANo.9621/D/90 and 142/Del/91 for the assessment year 1988-89. 2. The Assessee is an Association of Person (in short AOP) consisting of children and grand children of Late Shri Shiv Raj Bahadur and his wife who owned property bearing No.9, Raj Narain Road, Civil Lines, Delhi. By an agreement dated 1 st June, 1981, his children joined together to form the AOP with the common object of re-developing the property and to build flats on the plot. 3. The market value of the property was Rs.30 lacs and after getting necessary permission, the AOP proceeded to construct 24 flats. The members of the AOP were credited with their share in the property which was valued at Rs.30 lacs and these amounts were shown in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t claimed is an afterthought. 6. Aggrieved against the order, the Assessee preferred an appeal before the Commissioner of Income Tax (Appeals) who partly allowed the appeal of the Assessee. 7. Thereafter the Assessee as well as the Revenue filed cross-appeals before the Tribunal and vide the impugned order Tribunal partly allowed the appeal of the Assessee and dismissed the appeal filed by the Revenue. 8. The first issue raised by the Revenue in this case is as to whether the Tribunal was right in allowing the interest payable by the Assessee for the period 30th June, 1980 to 31st March, 1988 in the previous year relevant to the assessment year 1988-89. 9. The main objection raised by the Assessing Officer is that the intere ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ock, since the closing stock had been valued at cost and there is no provision in the Act for valuing the stock at market price and as such he rejected the claim of the Assessee. 12. It is well-settled that when the capital assets are converted into stock in trade, the Assessee is entitled to adopt the market value of the asset as on the date of conversion and this principle has been approved by the Apex Court in Commissioner of Income Tax v. Bai Shirinbai K. Kooka , [1962] 46 ITR 86. In this case the Assessee who held by way of investment several shares in companies commenced a business in shares converted the shares into stock-in-trade of the business, and subsequently sold these shares at a profit. It was held; (headnote) : ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed in place of actual price realized. Merely because the market price was more than the actual price, it cannot be said that the Assessee earned the profits. The addition made by the Assessing Officer in this regard has no basis. The flat has been actually been sold to the member only for Rs.6 lacs as already committed at the time when the construction commenced and therefore the addition of Rs.4.57 lacs was rightly deleted by the Tribunal. 17. Under these circumstances, we hold that no fault can be found with the view taken by the Tribunal. Thus, the order of Tribunal does not give rise to a question of law, much less a substantial question of law, to fall within the limited purview of Section 260-A of the Act, which is confined to ent ..... X X X X Extracts X X X X X X X X Extracts X X X X
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