Tribunal rejects capital gains addition under section 50C, rules property not covered.

The Tribunal allowed the appellant's appeal by deleting the long term capital gains addition under section 50C of the Income Tax Act, 1961. It held that section 50C does not apply unless there is a transfer of land and building forming the relevant capital asset. The Tribunal accepted the appellant's argument that the property in question, an unfurnished flat never registered in the appellant's name, did not fall under section 50C. However, the Tribunal rejected the deduction claimed for the transfer of the property, as the appellant's representative did not press for it during the proceedings.

---

---

Issues involved:
1. Correctness of Commissioner of Income Tax (Appeals)'s order upholding long term capital gains addition under section 50C.
2. Disallowance of expenditure claimed for transfer of property.

Issue 1: Correctness of Commissioner of Income Tax (Appeals)'s order upholding long term capital gains addition under section 50C:
The appellant's appeal questioned the correctness of the Commissioner of Income Tax (Appeals)-10, Kolkata's order upholding the Assessing Officer's action of adding long term capital gains amounting to Rs. 37,85,396 after invoking section 50C of the Income Tax Act, 1961. The appellant contended that the application of section 50C was erroneous as the property in question was neither land nor a building. The Tribunal considered the additional ground raised by the appellant challenging the application of section 50C. The Tribunal admitted the additional ground, noting that the appellant sought to argue the non-application of section 50C only in the case of the right to acquire the residential flat. The Tribunal held that section 50C does not apply unless there is a transfer of land and building forming the relevant capital asset. As the property in question was an unfurnished flat that was never registered in the appellant's name, the Tribunal accepted the appellant's additional ground and deleted the long term capital gains addition.

Issue 2: Disallowance of expenditure claimed for transfer of property:
The appellant had claimed a deduction of Rs. 2 lakh as expenditure allegedly incurred on the transfer of the property. However, during the proceedings, the appellant's representative did not press for this deduction, citing its small amount. As a result, the Tribunal rejected the claim as not pressed. Consequently, the Tribunal partly allowed the appellant's appeal, deleting the long term capital gains addition under section 50C but rejecting the deduction claimed for the transfer of the property. The order was pronounced on 24/08/2018 by the Tribunal.

---