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TMI Blog2016 (12) TMI 1797X X X X Extracts X X X X X X X X Extracts X X X X ..... y holding that transaction of sale and purchase of the house was not assessable as income from Business and Profession but was a transaction assessable under the head Income from Capital gain. 3. Briefly stated, the facts of the case are that the assessee is a Civil and Labour Contractor, who has filed the return of income on 01.10.2012 declaring total income of Rs. 28,59,480/-. During the course of assessment proceedings, the AO noticed that the contract receipt of the assessee were at Rs. 3,67,69,356/-. The AO further noticed that the assessee has made a separate trading account for sale of house at E-7, Arera Colony, Bhopal, in respect of a house purchased on 25.02.2011 for Rs. 1,20,00,000/- and also claimed expenditure of Rs. 12,39,000 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ading account of this house, the net profit rate comes to 5.68 %, which is very low in comparison to 8 % net profit rate in such type of business. Therefore, the AO treated the said transaction of sale of immovable property as short term capital gain and computed short term capital gain at Rs. 19,61,000/- ( Rs. 1,52,00,000/- (-) Rs. 1,32,39,000/-). 4. Aggrieved with the order, the assessee has filed the appeal before the CIT(A). 5. The ld. CIT(A) noted that there is no dispute that transaction in the house property is an isolated transaction and the assessee had no record or history in trading of property. Besides the fact, the assessee got the property registered in his name and incurred a very substantial amount of stamp duty etc. is in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r dealing in construction business, which is also evident from the form 30CD audit report. We also find that no separate books of accounts were maintained in respect of business of trading in property nor any opening or closing balance in respect of the said property is shown. Therefore, this is an isolated transaction of purchase of a house, which, ofcourse, purchased in the name of individual capacity after obtaining housing loan for the said purchase. The house property is registered in his name on which stamp duty payment has also been made. Therefore, the assessee has purchased a capital asset, which has been sold in a very short span of time. Therefore, in the light of these facts, we are of the considered opinion that the lower autho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to income from house property in various years and the year of transfer may be subjected to both, if the facts and circumstances so required. In the case of the assessee, neither there is a claim of income/loss from house property nor is there any addition/reduction of the same. Hence, alternative argument of the assessee was turned down. 12. Being aggrieved the assessee has filed this appeal before us. 13. The Ld. Counsel for the assessee contended that the AO and ld. CIT(A) have considered the transaction of purchase and sale of immovable property as short term capital gain and not business income as claimed by the assessee. However, the ld. CIT(A) has erred in not considering the computation of income from house property as alternative ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... there was no question to compute the income from house property as the assessee has not made any such claim in the return of income. 15. We have heard the facts and find that the assessee has claimed this purchase and sale of this house property and shown business income thereon at Rs. 3964/- by computing separate trading account. However, the lower authorities have found that the assessee is not engaged in the business of real estate, as this was a solitary transaction conducted by the assessee. Therefore, the income from this property was assessable as income under the head Capital Gain. Accordingly, short term capital gain of Rs. 19,61,000/- was worked out and assessed accordingly. We also find that the assessee has raised his alternati ..... X X X X Extracts X X X X X X X X Extracts X X X X
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