TaxTMI 
TaxTMI 
2019 (4) TMI 1657
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....case. 3. The brief facts of this issue are that the assessee purchased 7 Nos. of Industrial Galas at Malad, Mumbai from one Builder viz. Homeland Realtors arid Developers Private Limited in the year 2007 jointly with her husband Mr. Bhavesh Natwarlal Ganatra at an agreed consideration of Rs. 53,75,700/-. The details of the same are as follows: Sr. No. Gala No, Consideration Amount (Rs.) 1 118 6,90,000/- 2 121 6,90,000/- 3 123 6,90,000/- 4 1 24 6,90,000/- 5 125 6,90,000/- 6 126 12,35,700/- 7 228 6,90,000/- Total Rs. 53,75,700/- 3.1. The assessee paid the entire consideration for the same as under: Sr. No. Date Amount (Rs.) 1. Amount transferred from Loan Given to M/s. Parikh Builders upto F.Y. 2005-06 36,00,000/- 2. 20/10/2007 34,00,000/- 3. 07/11/2007 5,00,000/- 3.2. Homeland Realtors Mid Developers Private Limited issued the Allotment Letters to the assessee in 2007 allotting the specific Galas with specific Galas with corresponding galas marked on the floor plan. 3.3. The construction of the said Industrial Estate was completed in the year 2012 and therefore Homeland Realtors and Developers Private Limited sent a ....
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....the Appellant during the year on which long term capital gain was shown in the return was a 'long term capital asset' or 'short term capital asset' as per section 2 (42A) of the Income Tax Act, 1961. 5.1. The appellant has also demonstrated successfully that the allotment letters of galas were issued on 22/10/2007. It is further observed that the entire consideration for purchase of galas was paid before the allotment letter through adjustment of loan from sister concern and payments from the bank accounts of the husband of the appellant. 5.2 As per Section 2 (42A) of the Act, "Short -term capital asset" means a capital asset held by an assessee for not more than thirty-six months immediately preceding the date of its transfer" 5.3 After going through decisions relied on by the appellant, it is found that for the purpose of holding an asset, it is not necessary that the assessee should be the owner of the asset with a registered deed of conveyance conferring title on him. As per section 2(47); sale, exchange or relinquishment of the asset or the extinguishment of any right: therein is to be treated as transfer in relation to a capital asset. Even in the absenc....
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....ng the same as per law. The ground no. 2 is allowed. 4. Aggrieved, the revenue is in appeal before us. 5. We have heard rival submissions. We find that the factual findings recorded by the ld. CIT(A) that the allotment letters of Galas were issued to the assessee on 22/10/2007; that the entire consideration for purchase of said Galas was paid by the assessee before the allotment letter through adjustment of loan from sister concern and payments from the bank accounts of the husband of the assessee, remain uncontroverted by the revenue before us. We find that the ld. CIT(A) had reckoned the specified date to be the date of allotment i.e., 22/10/2007 and accordingly held that assessee had held Galas for more than three years before the date of transfer and accordingly treated the same as long term capital gain and consequently granting benefit of exemption u/s.54F of the Act. It is not in dispute that assessee had indeed made investigation within the prescribed time in a new residential property making her eligible to claim benefit of exemption u/s.54F of the Act. The only dispute to be decided is whether the resultant gain on sale of industrial Galas by the assessee would be long ....
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....15th October, 1986 had clarified this position by holding that when an assessee purchases a flat to be constructed by Delhi Development Authority ("D.D.A." for short) for which allotment letter is issued, the date of such allotment would be relevant date for the purpose of capital gain tax as a date of acquisition. It was noted that such allotment is final unless it is cancelled or the allottee withdraw from the scheme and such allotment would be cancelled only under exceptional circumstances. It was noted that the allottee gets title to the property on the issue of allotment letter and the payment of installments was only a followup action and taking the delivery of possession is only a formality. 5.This aspect was further clarified by the CBDT in its later circular No.672 dated 16th December. In such circular representations were made to the board that in cases of allotment of flats or houses by cooperative societies or other institutions whose schemes of allotment and consideration are similar to those of D.D.A., similar view should be taken as was done in the board circular dated 15th October, 1986. In the circular dated 16th December, 1993 the board clarified as under: "2.....
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....ai, [in short referred to as „CIT(A)‟], Appeal No. CIT(A)- 37/IT-886/ACIT-25(2)/15-16 dated 27/09/2017 on following grounds of appeals: - "1. On the facts and in the circumstances of the case and in law, the Ld. CIT(A) has erred in deleting the addition on account of Short-Term Capital Gain stating that the right in a property is created once its title is allotted to the purchaser and more so, if full consideration is paid. As the assessee had received an allotment vide letter dated 26.02.2008 and paid full consideration by 24.07.2008. Therefore, the assessee got the title to the property on the issuance of the allotment letter by the builder / seller." 2. "On the facts and in the circumstances of the case and in law, the Ld. CIT(A) has erred in allowing the deduction claimed u/s.54F of Rs.l,09,40,072/-, stating that the house was purchased within two years of sale, as required u/s 54F" 3. "On the facts and in the circumstances of the case and in law, the Ld. CIT(A) has erred in not considering that the addition was made by the AO because it was clearly mentioned in the 2nd para of the allotment letter that the documents regarding allotment would be executed after....
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.... Santa Cruz (W), Mumbai [flat] on 04/04/2012 for a sale consideration of Rs. 1200 Lacs, the assessee‟s share being 50% in the same. The assessee after adjusting the indexed cost of acquisition worked out Long-Term Capital Gains [LTCG] for Rs. 288.73 Lacs and after claiming deduction u/s 54F for Rs. 109.40 Lacs against the same, offered balance LTCG of Rs. 179.33 Lacs to tax. 2.3 It transpired that the said flat was purchased by the assessee vide Registered Agreement for Sale on 25/03/2010 and counted from this date, the assessee‟s holding period was less than 36 months which led to Ld. AO to treat the resultant gains as short-term capital gains [STCG]. The assessee defended the same by submitting that the said flat was purchased vide allotment letter dated 26/02/2008 and substantial payment of Rs. 185.50 Lacs was already made by 24/07/2008 and therefore the holding period, as counted from the date of allotment letter, was more than 36 months and therefore the resultant gains were Long-Term Capital Gains. 2.4 However, upon perusal of allotment letter as extracted on para 4.4 of the quantum assessment order, Ld. AO noted that the same did not contain the specific flat....
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....gned, which was not the case here. Finally, convinced with factual matrix, Ld. first appellate authority, vide para nos. 5.4 to 5.10 of the impugned order, came to a conclusion that the resultant gains were Long-Term Capital Gains in nature, against which benefit of progressive indexation was available to the assessee. 3.2 Regarding assessee‟s claim u/s 54F, it was noted that the investment in new flat was made on 14/04/2012 which was well within the stipulated time period as envisaged by Section 54F and therefore, the assessee was eligible to claim the said deduction in terms of CBDT circular No. 471 dated 15/10/1986. Reliance was placed on several judicial pronouncements also to arrive at the said conclusion, which has already been discussed in the impugned order in para nos. 6.5 to 6.8 of the impugned order. Accordingly, Ld. AO was directed to allow the claim of Rs. 109.40 Lacs u/s 54F as claimed by the assessee. Aggrieved, the revenue is in further appeal before us. 4. The Ld. DR, placing reliance on the cited decision of Hon‟ble Delhi High Court in Gulshan Malik Vs. CIT [43 Taxman.com 200] supported the stand of Ld. AO by submitting that this decision has alr....
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....sessee is an individual. The assessee had filed the return of income for the assessment year 2009-10 and claimed long term capital gain arising out of capital asset in the nature of a residential unit. During the course of assessment, the Assessing Officer examined this claim and came to the conclusion that the gain arising out of sale of capital asset was a short term capital gain. The controversy between the assessee and the revenue revolves around the question as to when the assessee can be stated to have acquired the capital asset. The assessee argued that the residential unit in question was acquired on the date on which the allotment letter was issued by the builder which was on 31st December, 2004. The Assessing Officer however contended that the transfer of the asset in favour of the assessee would be complete only on the date of agreement which was executed on 17th May, 2008. 3. CIT appeals and the Tribunal held the issue in favour of the assessee relying on various judgments of different High Courts including the judgment of this Court in case of CIT v. TATA Services Ltd. [1980] 122 ITR 594/[1999] 1 Taxman 427. Reliance was also placed on CBDT circulars. 4. Having hea....