9911796707
TMI Blog2020 (4) TMI 562X X X X Extracts X X X X X X X X Extracts X X X X ..... and has wrongly treated the said amount as taxable capital gain. The AO has remarked that the appellant society has violated provisions of Section 50C but the observations are factually wrong. 2. The appellant craves leave to (i) add any new ground of appeal and/or (ii) amend, alter or delete any of the above grounds of appeal." 3. The brief facts of the case are that the assessee filed its return of income on 16.03.2017 declaring total income to the tune of Rs. 3,24,050/-. The case was selected for scrutiny under CASS. Notices u/s 143(2) & 142(1) of the Act were issued and served upon the assessee. The assessee is a Co-operative Housing Society & Derives its income from interest income and income from other sources. The case was selec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... AO, therefore, the finding of the CIT(A) is not justifiable and is liable to be set aside. In support of this contention, the Ld. Representative of the assessee has placed reliance upon the decision of Jurisdictional High Court in the case of CIT- 18 Vs. Sambhaji Nagar Co-op. Hsg. Society Ltd. (2015) 54 taxmann.com 77 (Bom). However, on the other hand, the Ld. Representative of the Department has refuted the said contention and strongly relied upon the order passed by the CIT(A) in question. It is correct that the assessee has received the consideration of Rs. 3,18,54,500/- on transfer of development rights to the developers. The stamp duty was also paid for the consideration of fair market value of Rs. 3,19,64,000/-. The assessee is a co- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... new building by adding the additional floor on the said property to accommodate the new members brought by developer to recoup its cost of redevelopment. The society nowhere transferred FSI and assigned the rights and interest in the old land and building for a monetary consideration. The Ld. Representative of the assessee has argued that the issue has duly been covered by the decision of Hon'ble ITAT in the case of New Shailaja Co-operative Housing Society Ltd. Vs. ITO (2010) 36 SOT 19 (Mum) and by decision of the Hon'ble High Court of Bombay CIT-18 Vs. Sambhaji Nagar Co-operative Hsg Society Ltd. in 370 ITR 325. In the case of New Shailaja Co-operative Housing Society Ltd. Vs. ITO (2010) 36 SOT 19 (Mum) the Hon'ble ITAT has given the fol ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ibuted to the additional FSI received by means of 1991 Rules. It is true that such right is a capital asset as per the provisions of section 2(14) but in order to compute capital gains apart from the existence of capital asset, there should be sale consideration accruing as a result of transfer of capital asset as well as the cost of acquisition of the asset along with the cost of any improvement thereto, if any. Section 48 sets out the mode of computation of income under the head capital gains by providing that the expenditure incurred wholly and exclusively in connection with the transfer of a capital asset along with the cost of acquisition and cost of any improvement, if any, shall be deducted from the full value of consideration receiv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .C. Srinivasa Setty (supra) shall apply and no capital gains would be charged. 5. Coming back to the facts of the instant case it is abundantly clear that the assessee had not incurred any cost of acquisition in respect of the right which emanated from the 1991 Rules making the assessee eligible to additional FSI. The land and building earlier in the possession of the assessee continued to remain with it as such even after the transfer of the right to additional FSI for Rs. 48.96 lakhs. The learned Departmental Representative could not point out any particular asset as specified in sub-section (2) of section 55, which would include the right to additional FSI. In our considered opinion, no capital gains can be charged on the transfer of t ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
