TaxTMI 
TaxTMI 
2013 (11) TMI 836
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....ains" and not "business income". 3. Ld D.R. relied on order of AO. However, ld A.R. submitted that the issue is covered in favour of the assessee in assessee's own case for the assessment year 2004- 05 in ITA No.5113/Mum/2011 order dated 14.9.2012 as the facts are similar in the assessment year under consideration i.e. assessment year 2003-04. Ld. DR did not dispute the above contention of ld. AR and conceded that the Tribunal decided the same issue on identical facts in the assessee's own case for assessment year 2004-05 by following its decision dated 11.1.2010 in the case of co-owner namely Mrs. Kailash Premnarayan for assessment year 2004-05 in assessee's favour in ITA No.6293/Mum/2007 in the appeal filed by the department and the appe....
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....n the accounting year i.e. relevant to assessment year 2004-05. The amount aggregating to Rs.88.30 lakhs was disclosed as capital gains by all the co-owners in accordance with their share of the property in respective assessment years. The AO while making assessment for assessment year 2004-05 considered the said arrangement as adventure in the nature of trade and not treated the amount received as long term capital gain. The AO stated that the family members converted capital assets into stock-in- trade and, accordingly, he computed the income of the co-owners as capital gain u/s.45(2) of the Act. The AO bifurcated the profit from construction activity and capital gain on conversions of capital assets as per section 45(2) of the Act. Howev....
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....g finance for carrying out the said construction on the terms and conditions agreed by and between the parties. Thereafter, the construction was made after availing finance from market on behalf of these co-owners by GPIL. As per agreement, the loan amount was payable to the Project Manager from the share of net realization/surplus from the property constructed by GPIL as per clause 12 of the agreement entered into. As stated above, the building was constructed and all the co-owners were possessed with one flat each. Those flats were used for their residential purposes. Three flats were sold by these co-owners for the purpose of paying cost of construction including loans taken by GPIL on behalf of these co-owners. Accordingly these co-owne....