2019 (10) TMI 1208

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....that the CIT(A) has grossly erred in arbitrarily rejecting all the contentions made by the assessee supported by material evidence to show that the amount of Rs. 750/-per sq.ft as appearing in the Joint Development agreement by the assessee with M/s. Swastika Gautam Developers is merely an amount fixed as payable to the assessee for any shortfall in constructed area transferable as agreed consideration against transfer of land & building belonging to the assessee. 3. For that the CIT(A) erred in upholding the cost of construction at Rs. 750/- per sq.ft determined arbitrarily by the AO and also by upholding the method of computing capital gain as employed by the AO notwithstanding that the question of the value of land is wholly irrelevant....

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....). Hence, the Assessing Officer required the assessee to explain as to why the short term capital gain of Rs. 17,08,750/- should not be added to the income of the assessee. In reply to the query of the Assessing Officer, the assessee, inter alia, submitted that there is a clause in the agreement, according to which, in respect of fractional portion of agreed compensation Rs. 750/- per sq.ft will be paid by the developer to the owners of the land and no stamp duty was paid as per the requirement of stamp valuation authority. It was submitted that it was an agreed consideration and no sale deed was executed. It was also submitted that no income have arisen to the assessee inasmuch as the cost of acquisition of flat in exchange of land/buildi....

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....erm capital gain by allowing some relief to the assessee. 5. Still aggrieved by the order of the CIT(A), the assessee is in further appeal before us. 6. Ld A.R. submitted that Rs. 750/- per sq. ft was agreed between the assessee and the developer in the year 2010 when the agreement was entered into but the flat was sold during 2013. He also submitted that Rs. 750/- per sq.ft was for baren land, which does not include any cost of construction. The cost of acquisition as on 2013 shall include cost of construction. He also submitted that the assessee has sold two more flats in assessment year 2016-17, which was sold at a price of Rs. 2400/- per sq.ft and for capital gains the cost of indexation was calculation at Rs. 2235/- per sq.ft and the....

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....ncome-tax as his income of the previous year in which such stock-in-trade is sold or otherwise transferred by him and, for the purposes of section 48, the fair market value of the asset on the date of such conversion or treatment shall be deemed to be the full value of the consideration received or accruing as a result of the transfer of the capital asset.] From the plain reading of the section, it is clear that capital gain is chargeable in the year in which such conversion took place and capital gain is charged u/s.48 accordingly. In the instant case the conversion took place on 4.2.2010 as per the agreement entered into by and between developer and the assessee. Accordingly, the capital gain whether short term or long term depending up....