TaxTMI 
TaxTMI 
2012 (8) TMI 919
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....tory building (Basement ground) as asset held for less than 36 months before the date of its transfer and consequently denying exemption u/s. 54EC of Rs. 50,00,000/-. On the basis of facts and in the circumstances of the case, factory building ought to be treated as long term assets being assets held for more than 36 months before the date of its transfer and exemption u/s. 54EC ought to be allowed. 2. The Ld. CIT(A) has erred in upholding the action of the AO in treating sale of property let out (upper floor) as asset held for less than 36 months before the date of its transfer and consequently treating capital gain as short term gain. On the basis of facts and in the circumstances of the case, property given on rent being held fo....
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....tion of the assessee. So far as the sale of plot of land is concerned and accepted, the capital gain offered as Long Term Capital gain. The AO observed that the consideration of Rs. 1,78,62,400/- for the building has been allocated equally between ground and upper floor. The basement and ground floor were used for the purpose of business and depreciation has been claimed on the same. As the basement plus ground floor was in use for the purpose of business for more than 3 years and accordingly, the assessee treated the capital asset was Long Term in nature. However, the gain has been deemed to be short term capital gain as per Section 50 of the Act. The upper floor was given on rent to Shemaroo Videl Pvt. Ltd. And the rent income was shown u....
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....completed the assessment accordingly. 5. The assessee carried the matter before the Ld. CIT(A) and submitted that the holding period of both the land and the factory building is more than 36 months and therefore the asset should have been treated as Long Term Capital asset. Further even because of the deeming provision of Sec. 50 of the Act wherein the gain arising out of the transfer of depreciable asset is treated as Short term capital gain, the benefit of exemption u/s. 54EC cannot be denied. However, the arguments and the submissions made by the assessee did not find any favour from Ld. CIT(A) who confirmed the finding of the AO. 6. Aggrieved by this, the assessee is in appeal before us. The Ld. Counsel for the assessee reiterated....
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....Fire Officer, Mumbai Fire Brigade granting the assessee to occupy and use the factory building. Referring to this, the Ld. Counsel has rightly stated that the factory building is more than 36 months old. At page-35 of the paper book, we find that there is a Municipal Corporation Tax receipt dt. 25th September, 1997 which also substantiate the claim of the assessee. It appears that the AO has wrongly taken the date as 1.10.2003 only because the assessee claimed depreciation for the first time during the year under consideration on the amount apportioned between the factory building (rented) and factory building (SOP). We have also considered the schedule of fixed assets since 1996 to March, 2004 exhibited from page 42 to 50 of the Paper Book....
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....appointed prior to July 19, 1969. The respondent therein who had joined the bank on July 1, 1972, claimed extension of service because he was deemed to be appointed in the bank with effect from October 26, 1965, for the purpose of seniority, pay and pension on account of his past service in the army as Short Service Commissioned Officer. In that context, the apex court has held that the legal fiction created for the limited purpose of seniority, pay and pension cannot be extended for other purposes. Applying the ratio of the said judgment, we are of the opinion, that the fiction created under section 50 is confined to the computation of capital gains only and cannot be extended beyond that. Thirdly, section 54E does not make any distinction....