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TMI Blog2019 (10) TMI 15X X X X Extracts X X X X X X X X Extracts X X X X ..... relating to the issue are stated in brief: The original assessment in the hands of assessee was completed u/s 143(3) of the Act on 21/3/2010 by the AO. The assessee had declared long term capital gain arising on account of entering joint development agreement on 18/9/2012 by the assessee with M/s S.L.N.S Construction for development of land and building belonging to the assessee. As per the agreement, the assessee was given cash of Rs. 233 lakhs and two flats with two covered car parking in the residential complex to be built by the developer. While working out Long term capital gains, the assessee took sale consideration of land and building at 317 lakhs. The assessee deducted indexed cost of Rs. 40.81 lakhs. The assessee also claimed fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re us. 6. We heard the parties and perused the record. The ld AR submitted that the AO has placed reliance on the recital made in the joint development agreement, as per which the estimated cost of construction of the 2 apartments allotted to the assessee in the proposed building and 2 covered car parking was mentioned as 2.67 crore. He submitted that the construction cost of 2 flats measuring around 3400 sft, by no stretch of imagination, shall work out to 2.67 crores as mentioned in the Joint Development Agreement (JDA). He submitted that the amount so mentioned in the JDA may be a mistake and in any case, it cannot override real facts. The ld AR submitted that the AO has examined the claim of Long term capital gain made by the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gain amounts scheme was also claimed u/s 54 of the Act only. Accordingly he submitted that the AO was not right in law in rejecting the claim of Rs. 60.00 lakhs claimed by the assessee u/s 54 of the Act. 9. The ld DR, on the contrary, submitted that the Joint development agreement entered by the assessee with the builder mentions the cost of construction of the two flats allotted to the assessee as Rs. 2.67 crores. She submitted that the agreement entered between the parties has more evidentiary value. Accordingly she submitted that the tax authorities were justified in adopting the same for computing the long term capital gain. In the alternative, the ld DR submitted that the cost of construction of flats could be ascertained from the b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... development. We also find merit in the contentions of the assessee that the cost of construction of two flats along with two covered car parking could not be Rs. 267 crores. In our view, the manner of ascertaining the cost of construction should be left to the wisdom of the assessing officer. Accordingly, we are of the view that this issue needs to be examined at the end of the AO. Accordingly we set aside the order passed by the ld CIT(A) on this issue and restore the same to the AO for determining the value of cost of construction. 12. The Ld A.R submitted that the value of two flats and two covered car parking as determined by the AO should be allowed as deduction u/s 54 of the Act, since the same would represent the value of new flats ..... X X X X Extracts X X X X X X X X Extracts X X X X
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