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2016 (7) TMI 22

Sale of flat acquired by her in lieu of surrender of tenancy rights - working out the taxable gains the assessee - cost if acquistion - AO made addition of the entire amount as Long Term Capital Gain treating the cost of acquisition of the tenancy as ‘NIL’ - Held that:- In the case of Atul G.Purnaik vs. ITO (2011 (5) TMI 576 - ITAT, Mumbai ) the assessee was allotted a plot of land to the assessee as compensation in lieu of agricultural land acquired by the government under “12.5% Expansion Sche .....

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Society Dader, Mumbai, for a total consideration of ₹ 1,01,00,000/-, The said flat had been acquired by her in lieu of surrender of tenancy rights. While working out the taxable gains the assessee calculated the cost of acquisition of the flat at ₹ 54,72,000/- as on 30/10/1993, i.e., the date when the assessee got possession of the flat in the re-developed building. After considering the contentions of the assessee, the AO made addition of the entire amount of ₹ 1,01,00,000/- .....

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in lieu of the original surrendered asset would be computed by reducing from the sale consideration the fair market value of the plot acquired by the assessee on surrender of original assets. 4. Dissatisfied with the impugned order passed by the Ld. CIT(A), the revenue is in appeal before the Tribunal. The revenue has challenged the impugned order on following effective grounds:- (i) On the facts and in the circumstances of the case the ld. CIT(A) erred in deleting addition made by the A.O under .....

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ee and deleted the addition made by the AO. The cases referred by the assessee are distinguishable on facts and as such the same are not applicable to the assessee s case. Since the cost of tenancy to the assessee was NIL, the entire sale value of said flat was required to be taken as capital gain of the assessee, therefore, the AO has rightly added the entire amount of sale consideration to the income of the assessee under the head Long Term Capital Gain. Therefore, the impugned order is bad in .....

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iod flat. The assessee has rightly calculated the cost of acquisition of the flat at ₹ 54,72,000/- as on 30/10/1993, i.e., the date when she got possession of the flat. Hence the impugned order does not suffer from any legal infirmity. Therefore, the appeal filed by the revenue has no merit. 7. We have heard the rival submissions and perused the material on record including the cases referred by the parties in support of their contentions. In the case of Atul G.Purnaik vs. ITO (supra) the .....

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f the entire land on the date of allotment as valued by the Registered Valuer. The AO, however, took the same as Nil relying on the provisions of sec. 45(5), while the ld. CIT(A) took the same at ₹ 52,000/-, being the premium paid by the assessee for obtaining the said land. As rightly submitted by the ld. counsel for the assessee, a similar issue had come up for consideration before the Co-ordinate Bench of the Tribunal in the case of Atul G. Puranik vs. ITO (132 ITD 499) wherein a simila .....

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n the case of Atul G. Puranik is thus squarely applicable to the issue involved in the present case and respectfully following the same, we direct the AO to take the cost of acquisition of the land of the assessee for the purpose of computing capital gain at ₹ 1,07,90,000/-, being the market value of the said land on the date of allotment. Ground no. 3 of the assessee s appeal is accordingly allowed. 8. In our considered opinion the issue in dispute in the present case is similar to the is .....

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