TaxTMI 
TaxTMI 
TaxTMI 
2017 (12) TMI 873
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....acts and in the circumstances of the case and in law, the Ld. CIT(A) erred in holding that the same proportionate for the cost of construction for the FY 2008-09, 2009-10 and 2010-11 be maintained and the entire gains on the cost of land and building be taxed as Long Term Capital Gain instead of Short Term Capital Gain. 2. Whether, on the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in not holding that the construction of new structure (new asset) after demolition of the old structure (old asset) can be treated as improvement of the old asset and also holding that cost of acquisition will be from the date of holding old asset and not new construction. 3. Briefly stated, the facts of the case are that the ....
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....9;the Society', Juhu Scheme, Vile Parle (W), Mumbai 400056. 25/02/1993 By Deed of Assignment dated 25/02/1993, Shailesh Harsuman Mehta assigned his 1/4th undivided share in the Plot No. 13 together with the old buildings standing thereon for the residue of the unexpired term of lease to the assessee Shri Dinesh C Shah. By Deed of Assignment dated 25/02/1993, Haresh Harkant Mehta assigned his 1/4th undivided share in the Plot No. 13 together with the old buildings standing thereon for the residue of the unexpired term of lease to the assessee Shri Dinesh C Shah. By Deed of Assignment dated 25/02/1993, Vipul Harkant Mehta assigned his 1/4th undivided share in the Plot No. 13 together with the old buildings standing thereon for t....
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....um with eight floors, each floor with one residential fiat 29/08/2007/ 05/02/2008 Purchase of TDR from M/s Eversmile Construction Co Pvt. Ltd. / M/ s Dynamix Realty 22/09/2009 MOU assigning Flat No 201 admeasuring 1945.30 sq ft carpet area to Mr. Chetan Prakash Jain for structural ownership basis with one stack parking together with unrestricted right to use common areas and facilities 22/09/2009 MOU assigning Flat No 301 admeasuring 1945.30 sq ft carpet area to Vishal Prakash Jain for structural ownership basis with one stack parking together with unrestricted right to use common areas and facilities 22/09/2010 MOU assigning Flat No 401 admeasuring 1945.30 sq ft carpet area to Mrs. Manjula Prakash Jain and Mr. Ji....
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....st the LTCG of Rs. 9,62,06,609/- as claimed by the assessee. 4. Aggrieved by the order of the AO, the assessee filed an appeal before the Ld. CIT(A). The Ld. CIT(A) held that land cannot be alienated from a building and if there is a sale of flat, it cannot be held that the entire consideration was received only for the super-structure and that no value could be attributed to the land on which the said superstructure was constructed. The AO has not doubted the purchase of leasehold rights by the assessee in the FY 1991-92. The AO has also allowed proportionate cost of buying tenancy of Rs. 35,00,000/- and Rs. 75,00,000/- in the FY 2004-05 and FY 2005-06 respectively. The Ld. CIT(A) thus observed that the AO has recognized that there existe....
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....sition/improvement be taxed as LTCG instead of STCG. The Ld. CIT(A) thus held (i) in effect, as against the claim of LTCG of Rs. 9,62,06,609/- made by the assessee in his computation of total income after indexation, he shall be allowed the proportionate cost of acquisition of land in FY 1991-92 with indexation, the proportionate cost of improvement for FY 2004-05 and FY 2005-06 but for FY 2008-09 and FY 2009-10, he shall only be allowed the benefit of proportionate cost of construction without indexation and (ii) as far as FY 2010-11 is concerned, only the proportionate cost has been claimed which is legally permissible. 5. Before us, the Ld. DR submits that since the old bungalow was already demolished during FY 2007-08, there is no long....
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....e., the property, should be reckoned from the date of completion of the construction of the property or from the date of acquisition of the land. In CIT vs. Vimal Chand Golecha (1993) 201 ITR 442 (Raj), the land was purchased in 1962 and building was constructed thereon in the accounting years relevant to assessment years 1968-69, 1969-70 and 1970-71. The building was sold in 1970. It was held that the gains attributable to land were assessable as long-term capital gains. The gains attributed to the building were however, short-term capital gains. We refer here to the decision in CIT vs. Lakshmi B. Menon (2003) 264 ITR 76 (Ker); CIT vs. C.R. Subramanian (2000) 242 ITR 342 (Karn). Agreeing with the above view of the Hon'ble Rajasthan High ....