TaxTMI 
TaxTMI 
2010 (11) TMI 535
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....n when the asset so sold was clearly established to be part of the depreciable assets on which depreciation had been claimed resulting into invocation of the provisions of sec. 50(2) of the IT Act. 2. On the facts and circumstances of the case and in law, the learned CIT(Appeals) erred in directing the A.O. to allow exemption to the assessee under sec.54EC of the Act holding the sale of the asset as long term capital gain". 2. The assessee in this case is engaged in the business of trading and publishing of educational books. During the course of assessment proceedings, A.O. observed that assessee has shown long term capital gain of Rs.2,83,99,571. The same has been claimed under section 54EC of the Income-tax Act, 1961 ....
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....fy adopting the cost of land at Rs.1,48,00,000. He observed that the assessee had sold the entire building as well as furniture and fixture hence he observed that assessee's claim that it has sold land building and other assets separately is not correct. Assessing Officer held that assessee has never purchased the land and building separately and it is not possible to bifurcate the value as shown by the assessee in the balance sheet or in the calculation of capital gain. The claim of assessee treating the land as long term assets is, therefore, not correct and acceptable. Thus, Assessing Officer rejected the claim of long term capital gain and proceeded to compute the capital gain by applying the provisions of sec. 50(2) of the Act. In his ....
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....and S-8, Green Park, New Delhi sold during the year was done on the basis of two valuation reports, one close to the date of purchase and another close to the date of sale vide valuation report dated 30.6.2001 and 31st July 2005 respectively. The said property was sold on 29th August 2005 as per the sale deed filed. Hence, the assessee submitted that Assessing Officer was not at all justified in treating the holding period of land and building as less than 36 months and thereby treating the capital gain as short term and denied the exemption under sec. 54EC of the Act. 6. Since the valuation reports were not filed before the Assessing Officer, a remand report was called for by the Assessing Officer. Vide his report dated 8.4.2010 ....
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....3.99.571 7. Further assessee relied upon Hon'ble Madras High Court's decision in the case of CIT vs. D.L. Ramchandra Reassessment order 236 ITR 51. Several other decisions were also relied upon including the case of CIT vs. Vimal Chand Culecha 201 ITR 442, Smt. Laxmi B. Menon and another 204 ITR 76 (Ker.), CIT vs. CITI Bank 261 ITR 571 (Bom) and CIT vs. Ace Builders 281 ITR 210. Considering the above, Learned CIT(Appeals) held that he was of the view that Assessing Officer was not at all justified in treating the holding period of land at less than 36 months and thereby denying the exemption claimed under sec. 54EC of the Act on sale of land. Hence, he directed the Assessing Officer to allow exemption under section 54EC as claimed by the....
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....71,144 Total Capitalization on a/c of Properties C and D Nil 62,54,182 62,54,182 9. We have carefully considered the submissions. We find that assessee has produced valuation report at the time of purchase as well as sale. In Remand, Assessing Officer has not pointed out any lacunae in the same. Moreover, the cost of land so bifurcated was being already reflected in the books of accounts and no depreciation was claimed on that account. In the case of C.I.T. vs. D.C. Ramachandra Rao 236 ITR 51, Hon'ble Madras High Court has held that it is possible to bifurcate the capital gain arising out of sell of land and building, even if, they are sold as one unit. Land is an independent and identifiable capital asset and it continues to....