Appeal Partially Allowed in Tax Assessment for Couple under Portuguese Civil Code The appeal against the order of CIT(A) for A.Y 2004-05 regarding the assessment of income under section 5A of the Income Tax Act for a couple governed by ...
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Appeal Partially Allowed in Tax Assessment for Couple under Portuguese Civil Code
The appeal against the order of CIT(A) for A.Y 2004-05 regarding the assessment of income under section 5A of the Income Tax Act for a couple governed by the Portuguese Civil Code, 1960 in Goa was partially allowed. The court ruled that the flats given as commission to a third party were not to be added to the Assessee's income. However, cash received for the flats was to be included due to lack of evidence. Additionally, the income from the assignment of the flat was to be taxed in A.Y 2009-10 when possession was obtained, not in A.Y 2004-05 as argued by the AO.
Issues involved: Appeal against the order of CIT(A) for A.Y 2004-05 regarding assessment of income u/s 5A of the Income Tax Act for husband and wife governed by the Portuguese Civil Code, 1960 in Goa.
Issue 1 - Capital Gains on assignment of flats: The AO assessed total income against declared income, adding Capital Gains from assignment of flats. Assessee claimed flats were given as brokerage and commission. AO added income of 4 flats due to lack of evidence. Assessee argued for cost of acquisition and double taxation concern.
- Assessee's argument: Lack of documentary evidence for brokerage paid, circumstantial evidence accepted. Negotiations and payments for improving property title. Concern for double taxation. - Decision: Flats given as commission to Mr. Tahir Isani, not added to Assessee's income. Cash received for flats to be added due to lack of evidence.
Issue 2 - Taxation year for assignment of flat: AO taxed income from assignment of flat in A.Y 2004-05, while Assessee offered it for taxation in A.Y 2009-10 upon possession. Assessee argued transaction completion upon possession, not agreement.
- Assessee's argument: Taxation upon possession, not agreement. Transaction complete upon possession in A.Y 2009-10. - Decision: Income to be taxed in A.Y 2009-10 when possession obtained. Appeal allowed on this ground.
Conclusion: ITA No. 87/PNJ/2013 partly allowed, while ITA No. 88/PNJ/2013 allowed. Decision pronounced on 31/07/2013.
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