TaxTMI 
TaxTMI 
2022 (3) TMI 213
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....rom the transfer of short term capital assets as per sec.50C and hence taxable at the rate of 30%". (ii)` "On the facts and circumstances of the case and in law the Ld. CIT(A) erred in holding that for tax rate purpose sec. 112 of the Act is applicable on capital gains arising from transfer of depreciable assets and deeming fiction of sec 50 will not apply without appreciating the law that sec.112 is applicable only in case of Capital gains from the transfer of a long term capital assets and not to the capital gains arising from the transfer of short term capital assets as per sec.50C." (iii) "On the facts and circumstances of the case and in law the Ld. CIT(A) ought to have upheld the decision of AO of computing the capital gain tax on sale of flats, being depreciable assets at the rate 30% based on the decision of Hon'ble Bombay High Court in the case of Smt. Meena Pamnani vs. Commissioner of Income-tax, Mumbai [2017]86 taxmann.com175(Bombay). 2. The Ld.CIT (A)'s order is contrary in law and on facts and deserves to be set aside. 3. The appellant prays that the order of CIT (A) on the above grounds be set aside and that of the AO restored. The ....
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....thin the block of assets acquired during the previous year, such excess shall be deemed to be the capital gains arising from the transfer of short-term capital assets; (2) where any block of assets ceases to exist as such, for the reason that all the assets in that block are transferred during the previous year, the cost of acquisition of the block of assets shall be the written down value of the block of assets at the beginning of the previous year, as increased by the actual cost of any asset falling within that block of assets, acquired by the assessee during the previous year and the income received or accruing as a result of such transfer or transfers shall be deemed to be the capital gains arising from the transfer of short-term capital assets. 35. In this regard we may also refer to the decision of Hon'ble Bombay High Court and Hon'ble Supreme Court decision relied upon in this regard by learned Counsel of the assessee. • CIT Vs. V.S. Dempo Company Ltd. (387 ITR 354) • CIT Vs. M/s. Manali Investment (ITA No. 1658 of 2012). 36. In the case of V.S. Dempo Company Ltd. (supra) the facts were that in the return filed by....
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....nnot be denied exemption under Section 54E, because, firstly, there is nothing in Section 50 to suggest that the fiction created in Section 50 is not only restricted to Sections 48 and 49 but also applies to other provisions. On the contrary, Section 50 makes it explicitly clear that the deemed fiction created in sub-section (1) & (2) of Section 50 is restricted only to the mode of computation of capital gains contained in Section 48 and 49. Secondly, it is well established in law that a fiction created by the legislature has to be confined to the purpose for which it is created. In this connection, we may refer to the decision of the Apex Court in the case of State Bank of India vs. D. Hanumantha Rao reported in 1998 (6) SCC 183. In that case, the Service Rules framed by the bank provided for granting extension of service to those appointed prior to 19.07.1969. The respondent therein who had joined the bank on 1.7.1972 claimed extension of service because he was deemed to be appointed in the bank with effect from 26.10.1965 for the purpose of seniority, pay and pension on account of his past service in the army as Short Service Commissioned Officer. In that context, the Apex Court....
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.... was rendered in the context of eligibility of deduction under Section 54E ? 2 The respondent - assessee had during the subject assessment year sold its meters and transformers on which it had claimed depreciation. On sale, the respondent assessee claimed long term capital gains and sought to set off the same against its carried forward long term capital loss in terms of Section 74 of the Income Tax Act, 1961. The assessing officer disallowed the claim and held that in view of Section 50 of the Act, the gain is in the nature of short term capital gain. 3. On further appeal, the Tribunal by the impugned order has allowed the claim of the respondent assessee to set off its long term losses in terms of Section 74 of the Act against the long term capital gains on sale of transformers and meters. In the case of Ace Builders Limited, this Court held that by virtue of Section 50 of the Act only the capital gains is to be computed in terms thereof and be deemed to be short term capital gains. This deeming fiction is restricted only for the purposes of Section 50 of the Act and the benefit under Section 54E of the Act which is available only to long term capital gains was ....