Registered sale deed annexures can support indexation of construction cost when the relevant building particulars are already on record.

Registered sale deed annexures that form an integral part of the public document cannot be treated as fresh evidence under Rule 46A when they already record the existence, age and value of the building. On that basis, statutory indexation of the cost of construction under section 48 cannot be denied merely because the relevant particulars appear in Annexure 1-A to the deed. The capital gains computation had to include the indexed cost of both land and construction, and the treatment of the entire sale consideration as short-term capital gain was unsustainable.

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Issues: Whether the assessee was entitled to indexation of the cost of construction while computing capital gains, and whether the details in Annexure 1-A to the registered sale deed could be treated as additional evidence so as to deny that benefit.

Analysis: The sale deed had been obtained by the Department itself, and Annexure 1-A formed an integral part of that registered instrument. The annexure recorded the existence, age and value of the building standing on the land, so the material relevant to the cost of construction was already available in the public document on record. Once the sale deed was accepted as a public document and not additional evidence, the particulars contained in its annexure could not be segregated and excluded from consideration under Rule 46A. The benefit of indexation under section 48 is a statutory consequence, and it cannot be denied where the necessary material is already on record.

Conclusion: The assessee was entitled to indexation of the cost of construction, and the denial of that benefit was unsustainable. The capital gains had to be recomputed by considering both the indexed cost of acquisition of land and the indexed cost of construction.

Final Conclusion: The addition made by treating the entire sale consideration as short-term capital gain could not be sustained, and the appeal succeeded.

Ratio Decidendi: Where the relevant particulars of a building are contained in a registered sale deed and its annexure already obtained by the Department, those particulars cannot be treated as fresh evidence to deny statutory indexation under section 48 of the Income-tax Act, 1961.

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