TMI Blog2017 (11) TMI 1233X X X X Extracts X X X X X X X X Extracts X X X X ..... the definition has emphasized the same by the words “of any kind”. Therefore anything which can be called property will be included in the definition of capital asset. Therefore, in the light of the ratio of law laid down by the Hon’ble High Court, we hold that the assessee’s rights and interest whatsoever in the flat in question is an asset within the definition of section 2(14) of the Act. Hence, the Ld. CIT(A) has rightly held that the assessee’s right to obtain property being capital asset gives rise to capital gain. No doubt, the asset sold by the assessee, is not a building or land appurtenant thereto and a residential house, the income of which is chargeable under the head “income from house property” within the meaning of section 54 of the Act so as to get benefit of the said section. Section 54F clearly says that where the assessee being an individual, earns capital gain from transfer of any long term capital asset, not being a residential house and purchases residential house within a period of one year before or two years after the date from the date of such transfer, the capital gain shall be dealt with in accordance with the provisions of this section. Since, we ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... declaring the total income of ₹ 22,90,400/-. The return was processed and after scrutiny, AO determined the total income of the assessee at ₹ 96,87,900/-, after making disallowance of exemption claimed by the assessee u/s 54 of the Act and making addition of ₹ 73,97,500/- as income from short term capital gain and ₹ 9,414/- towards income from other sources. The AO noticed during assessment proceedings that the assessee and his wife Ms. Vandana Mishra jointly booked Flat No. 2401, Grandeur Bldg., Vasant Marvel, Phase-II, Mallad (East) from M/s Sheth Developers Pvt. Ltd. for ₹ 46,02,500/- (including ₹ 9,61,165/- cost of improvement) in the year 2006. Allotment letter was issued on 26.11.2006. However, the agreement was registered on 21/08/2012. Thereafter, the assessee entered into an agreement with Sh. Divyesh Shah and Smt. Daksha Shah for sale of the said property on 27/08/2012 for the sale consideration of ₹ 1,20,00,000/- and earned ₹ 73,97,500/-. Thereafter the assessee and his wife jointly purchased Flat No. B-501 in Bldg. Aquaria Grand on 24/10/2012 for a total value of ₹ 4,07,37,00,000/- vide agreement dated 24.10.2012. Ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted at the time of hearing. 5. Before us, the Ld. counsel for the assessee submitted that the Ld. CIT (A) has wrongly held that since the transfer is of a capital asset comprising of right to acquire property and not building which is residential house, the appellant is not entitled to deduction u/s 54 of the Act. Relying upon the judgments of Hon ble Bombay High Court passed in CIT Vs. Tata Services Ltd. 122 ITR 594 and CIT Vs. Vimal Lalchand Mutha 187 ITR 613 and decision of Mumbai Tribunal rendered in Anita D. Kanjani, [2017]79 taxmann.com 67(Mumbai Tribunal) submitted that as per the settled law holding period in case of under construction property must be reckoned from the date of allotment and the asset/right acquire in under constructions property/building shall be the capital asset within the meaning of section 2 (14) of the Act. In view of the fact that allotment letter in this case was issued on 26.11.2006, the Ld. CIT (A) has rightly held that the gain is long term capital gain. Since, the gain is long term capital gain arising from the transfer of long term capital asset, the assessee is entitled for exemption u/s 54 of the Act as Flat No.B-501 in Aquaria Gr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1. In April 1983, the assessee entered into an agreement for sale of the right title and interest in the said flat and accordingly the same was transferred to the purchaser. The Mumbai Bench of the Tribunal held the gain as long term capital gain by computing the holding period from the date of agreement. In appeal, the Hon ble Bombay High Court upheld the findings of the Tribunal. In the latest decision of the coordinate Bench rendered in the case of Anita D Kanjani vs. ACIT (supra), the coordinate Bench of the Tribunal has held that holding period has to be computed from the date of issue of allotment letter. In the present case, admittedly, the letter of allotment was issued in favour of the assessee on 26.11.2006 and agreement was entered into on 21.08.2012. Further agreement to sell the said property was entered into on 27.08.2012. Therefore, the Ld. CIT(A) has rightly, held the gain as long term gain by computing the holding period from the date of allotment of letter and not from the subsequent agreement. Hence, in the light of the cases discussed above, we uphold the findings of the Ld. CIT(A) and direct the AO to treat the gain in question as long term capital gain. 9 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... house in the same year, the assessee fulfills all the conditions contemplated under section 54F of the assessee. Although it appears from the record that the assessee has not taken the alternative plea of section 54F in the first appeal before the Ld. CIT(A) however, the benefit of the provisions of this section cannot be denied on this ground. We accordingly, modify the order of the Ld. CIT(A) to that extent and allow the benefit u/s 54F of the Act to the assessee. Accordingly, we direct the AO to compute the claim of the assessee in accordance with the provisions of section 54F of the Act. 12. Since, we have allowed the assessee s claim u/s 54F of the Act by holding the gain as long term capital gain we also direct the AO to allow the benefit of indexation of cost of acquisition from the date of each payment. 13. Ground pertaining to interest u/s 234B and D is consequential and the ground pertaining to initiation of penalty u/s 271(1)(c) is premature. Hence, we do not consider it necessary to adjudicate the same. ITA No. 5652/MUM/2016 (Assessment Year: 2013-14) 14. The assessee has challenged the impugned order passed by the Ld. CIT(A) on the following grounds: ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... term capital gain and to compute the exemption as per the provisions of section 54F of the Act. We further direct the AO to allow the benefit of indexation of cost of acquisition from the date of payment. 17. Ground pertaining to interest u/s 234B and D is consequential and the ground pertaining to initiation of penalty u/s 271(1)(c) is premature. Hence, we do not consider it necessary to adjudicate the same. ITA No. 6167/MUM/2016 (Assessment Year: 2013-14) The Department has challenged the impugned order passed in respect of assessee sh. Umashankar Mishra on the following grounds: 1. Whether on the facts and the circumstances of the case and in law, the ld. CIT (A) erred in treating the gain on sale of residential flat as Long Term Capital Gain when the sale has been made within a period of less than 36 months from the date of registration of the said flat. 2. The appellant prays that the order of the CIT (A) on the above ground be set aside and that of the Assessing Officer be restored. 3. The appellant craves leave to amend or alter grounds or add a new ground which may be necessary. 18. Before us, the Ld. DR submitted that the Ld. CIT (A) ha ..... X X X X Extracts X X X X X X X X Extracts X X X X
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