1998 (2) TMI 38

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....the instance of the assessee, Sri S. Rangarajan, Madras, the Tribunal referred the following question of law for the opinion of this court : "Whether, on the facts and circumstances of the case, in computing the capital gains arising out of the transfer of property received by the assessee from the company on reduction of its share capital, the assessee was entitled to substitute the market val....

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....it by reduction in the share capital. But the Income-tax Officer took the book value of the property as the cost of acquisition at Rs. 77,765 and computed the capital gains. The Appellate Assistant Commissioner confirmed the computation made by the Income-tax Officer. On further appeal, it was found that in the case of another shareholder of Kasthuri Estates Private Limited, the Appellate....

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....earned counsel appearing for the assessee, and Mrs. Chitra Venkataraman, learned counsel representing the Revenue, were heard. It is not as if the question arising for consideration in this action did not arise for consideration anterior in point of time and the plain fact is that such a question did arise for consideration before a Division Bench of this court, in the assessee's wife's case, name....

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....he market value of the property at Rs. 75,000. The Income-tax Officer, however, relying on the fact that the value of the assessee's shareholding in respect of 135 shares was reduced by Rs. 1,06,650 and in returning the reduced capital, a sum of Rs. 60,683 was adjusted in cash, computed the cost of the property at Rs. 19,550 on a proportionate basis. This was upheld by the Tribunal. On a refere....