TaxTMI 
TaxTMI 
TaxTMI 
2019 (3) TMI 1071
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....hereby the learned Tribunal dismissed the Revenue's Appeal and upheld the order passed by the learned CIT (Appeals). The relevant findings of the learned CIT (Appeals) are quoted below for ready reference:- "4 . I ncome from Long Term Capital Gains" 4.1 During the financial year relevant to A.y. 2003-04, the lands to the extent of 1,59,595 sq.ft., on 366 and 3/8 cents situated at Telugupalayam Village was acquired by Appropriate Authority of the Income Tax Department at Chennai on 11.03.2002 on payment of Rs. 4,59,35,168. These lands had originally cost the appellant a sum of Rs. 41,085 a long time back. In accordance with the provisions of the I.T.Act, 1961, the appellant was entitled to adopt the fair market value (FMV) as on 1.4.....
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....llant are on the main road and are also large in dimension and size. It was further submitted that land situated at the main road should be given higher value than the one situated in the interior. 4.3 The appellant has adopted a total sum of Rs. 1,20,90,375 for an area of 366 and 3/8 cents of land as FMV as on 1.4.81. The Assessing Officer has determined the FMV of the land as on 1.4.81 at Rs. 1,35,862. The appellant has supported its valuation by a report of a registered valuer which states that the value as on 1.4.81 to be Rs. 33,000 per cent. The Assessing Officer has stated that her valuation is as per enquiries made with and the rates obtained from the Sub- Registrar's office. The Assessing Officer has adopted the rate per acre ....
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....the minimum value at which a property could be registered. It is only guideline under and for the purposes of Stamp Act and should not be taken note of under Income Tax Act, 1961. Further, the valuation on the date of acquisition of the property by the Appropriate Authority of the Income Tax Department has been taken at Rs. 2,39,000 to Rs. 2,92,000 for each cent of land. Hence, it was pleaded that without prejudice to their submissions that the valuation of FMV as on 1.4.81 has to be taken at Rs. 33,000 for each cent of land, a reasonable amount may be considered in place of the amount of Rs. 333 per cent of land adopted by the Assessing Officer which is abnormally low. 4.5 I have carefully considered all the submissions and there is no....
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....roperty value would be approximately Rs. 9,900 per cent. Thus, taking into account all relevant factors, I hereby determine the FMV for each cent at Rs. 9,900 as on 1.4.81 and the Assessing Officer is hereby directed to adopt the same and compute the capital gains from the sale of the said property." 2. The learned Tribunal affirmed the findings of the learned CIT (Appeals) with the following observations:- "5.1 The explanation to Section 73 clearly states that it shall be speculation business in respect of a company other than a company whose gross total income consists mainly of income which is chargeable to tax under the head 'interest on securities, income from house property, capital gains or income from other sources'. As r....
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....y consists mainly of income from capital gains. 5.3 However, in view of the findings and facts of the present case, the Assessing Officer has to rework the capital gains by adopting the FMV for each cent of land as on 1.4.81 at Rs. 9,900 and if the "capital gains" as arrived at exceeds the amount of loss from purchase and sale of shares, the income from capital gains would become the main source of income and therefore, the loss from purchase and sale of shares would be allowed to be set off against such capital gains. On the contrary, if the income from capital gains is less than the loss incurred from the business of purchase and sale of shares, then loss from purchase and sale of shares would be deemed as loss from speculative business....