TMI Blog2021 (7) TMI 57X X X X Extracts X X X X X X X X Extracts X X X X ..... K. Panda, Accountant Member And Shri Sudhanshu Srivastava, Judicial Member For the Assessee : Shri H.P. Agarwal, C.A., Shri Rajat Jain, C.A. Shri Ashish Mendiratta, C.A. For the Revenue : Ms. Anima, Sr. D.R. ORDER PER R.K. PANDA, A.M. This appeal filed by the Assessee is directed against the Order dated 31.10.2019 of the Ld. CIT(A), Delhi-20, relevant to the A.Y. 2016-2017. 2. Facts of the case, in brief, are that the assessee is a Chartered Accountant by profession and derived income from house property, income from business or profession, capital gains and income from other sources. He filed his return of income on 13.10.2016 declaring total income at ₹ 1,66,02,000/-. During the course of assessment proceedings the A.O. noted that assessee has shown long term capital loss from sale of immovable property at ₹ 2,15,746/-. The property bearing address F-502, Aura , Sector-110/A Tehsil District Gurgaon, Haryana was purchased vide Conveyance Deed Dated 20.10.2015. This property was sold by the assessee through Sale Deed Dated 25.01.2016. The A.O. referred to the provisions of Section 2(47)(v) of the I.T. Act and came to the con ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1. The Ld. CIT(A) has erred both in Law and on facts of the case in confirming the assessment order passed u/s 143(3) of the Income Tax Act, 1961, in respect of addition made by the Ld. Assessing Officer to income of the assessee amounting to ₹ 21,30,356/-, by treating long term capital asset as short term capital asset, without giving benefit of indexation under second proviso to section 48 of the Income Tax Act, 1961. 2. Ld. CIT(A) has erred both in Law and on facts of the case in confirming the action of the Ld. Assessing Officer regarding levy of interest under section 234B of the Income Tax Act, 1961. 3. Ld. CIT(A) has erred both in Law and on facts of the case in confirming the action of the Ld. Assessing Officer regarding levy of interest under section 234D of the Income Tax Act, 1961. 4. Ld. CIT(A) has erred both in Law and on facts of the case in confirming the action of the Ld. Assessing Officer regarding initiation of penalty proceedings u/s 271(l)(c) of the Income Tax Act, 1961. 5. The appellant craves leave to amend, delete or add any ground of appeal before or during the course of hearing of the appeal. 3.1. Learned Coun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Hon ble Punjab and Haryana High Court in the case of Ms. Madhu Kaul v. Commissioner of Income-tax, Chandigarh [2014] 43 taxmann.com 417. 3. Order of ITAT, Bangalore Bench in the case of Sri Mahendrasingh Ramsingh v. ITO [ITA No. 32/Bang/2018]. 4. Order of ITAT, Bangalore in the case of L. Vivekananda v. Assistant Commissioner of Income Tax Circle-1(1), Mysuru [2021] 124 taxmann.com 67. 5. Judgment of the Hon ble Delhi High Court in case of Commissioner of Income Tax v. Jitendra Mohan [2007] 165 Taxman 524 (Del.) 6. Order of ITAT, Delhi ITAT in the case of Praveen Gupta vs., ACIT [2012] 20 taxmann.com 308. 3.3. He submitted that the holding period needs to be considered from the date of allotment letter and the gain that has accrued to the assessee is a long term capital gain and accordingly benefit of indexation should be allowed on the basis of payments made for purchase of immovable property. 4. The Ld. D.R. on the other hand, heavily relied on the Order of the A.O. and Ld. CIT(A). ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... execution of the Sale Deed at a subsequent date is irrelevant. It is also his submission that it is not necessary that the buyer needs to be owner of the asset with a Registered Sale Deed of Conveyance to determine the holding period. Further the payment of installments is only a follow-up action and taking delivery of the possession is only a formality. 6. We find sufficient force in the above arguments of the Learned Counsel for the Assessee. We find an identical issue came up before the Hon ble Bombay High Court in the case of Principal Commissioner of Income Tax-3, Mumbai v. Vembu Vaidyanathan (supra) where the Hon ble High Court has held as under : 2. This question arises in following background. The respondent-assessee is an individual. The assessee had filed the return of income for the assessment year 2009-10 and claimed long term capital gain arising out of capital asset in the nature of a residential unit. During the course of assessment the Assessing Officer examined this claim and came to the conclusion that the gain arising out of sale of capital asset was a short term capital gain. The controversy between the assessee and the revenue revolves around the qu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... which the purchaser of a residential unit can be stated to have acquired the property. There is nothing on record to suggest that the allotment in construction scheme promised by the builder in the present case was materially different from the terms of allotment and construction by D.D.A. In that view of the matter, CIT appeals of the Tribunal correctly held that the assessee had acquired the property in question on 31st December, 2004 on which the allotment letter was issued. 7. In the result, the Income Tax Appeal is dismissed. 6.1. We find that the above decision was challenged by the Revenue before the Hon ble Supreme Court and the SLP filed by the Revenue was dismissed. 6.2. We find the Hon ble Punjab Haryana High Court in the case of Ms. Madhu Kaul v. Commissioner of Income-tax, Chandigarh reported in [2014] 43 taxmann.com 417), while deciding an identical issue, has held as under :- 7. We find no distinction between the opinion recorded in the aforesaid judgment and the controversy in the present case. Admittedly, the flat was allotted to the appellant on 07.06.1986, vide letter conveyed to the assessee on 30.06.1986. The assessee paid the first ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... yment to the builder and having received allotment letter in lieu thereof, the assessee will be holding capital asset and, therefore, the benefit of indexation has to be granted to the assessee on the basis of payments made by him for acquiring the said asset and the assessee has rightly claimed the indexation benefit from the dates when he has made the payments to the builder. Therefore, we see force in the claim of the assessee. The AO is directed to provide the benefit of indexation to the assessee in the manner in which the assessee has claimed. 30. In the result, the appeal filed by the assessee is allowed. 6.4. Since the assessee in the instant case was allotted the property vide agreement Dated 11.04.2011 and allotment letter dated 08.07.2011, therefore, he has acquired a right in the asset and such right is a capital asset and payment of installments as per the terms is only a follow-up action and taking delivery of possession is only a formality. Therefore, the assessee in our opinion has correctly computed the long term capital loss. We, therefore, set aside the Order of the Ld. CIT(A) and direct the A.O. to allow the long term capital loss claimed by the as ..... X X X X Extracts X X X X X X X X Extracts X X X X
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