Delivery of possession governs transfer for capital gains on movable property; deferred payment does not postpone taxability.

For capital gains purposes, transfer of movable property is complete when possession is delivered to the transferee, not when sale consideration is finally received or when sale is treated as complete under sales tax concepts. On the facts, the truck was delivered on 15-5-1976, so the asset was held for less than the statutory period required for long-term treatment. The gain was therefore taxable as short-term capital gain, and the claim for deduction under section 80T was not sustainable.

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Issues: Whether the transfer of the truck took place on delivery of possession so that the capital gains arose in the earlier assessment year and were chargeable as short-term capital gains, with no deduction under section 80T.

Analysis: For purposes of capital gains, the relevant question was transfer of a capital asset and not the completion of sale under sales tax concepts. The transfer of movable property was complete when possession was handed over to the transferee, and the timing of receipt of the sale consideration did not control the date of transfer. On the facts, possession of the truck had been delivered to the purchaser on 15-5-1976, so the assessee had held the asset for less than the statutory period required for long-term treatment. The amended definition of short-term capital asset therefore applied, and the claim to treat the gain as long-term with deduction under section 80T was not sustainable.

Conclusion: The transfer was complete on delivery of possession on 15-5-1976, the gain was rightly assessed as short-term capital gain, and the claim for deduction under section 80T failed.

Ratio Decidendi: In the case of movable property, transfer for capital gains purposes is complete on delivery of possession to the transferee, irrespective of deferred payment terms.

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