2014 (10) TMI 1078

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....addition of Rs. 11,00,000/- being compensation received by the assessee from the developer under the head 'capital gains'. The second ground is raised agitating the taxing of the monitory value of the additional area of 210 sq. ft. amounting to Rs. 16,05,515/- under the head 'capital gains'. The ground No. 3 taken by the assessee is an alternative ground to the effect that if the additional area of 210 sq. ft. is liable for tax under the head 'capital gains', then the assessee is also entitled to claim deduction under section 54F of the Income Tax Act (hereinafter referred to as the Act). 3. The brief facts of the case are that the assessee had been owner of a residential flat admeasuring 450 sq. ft. carpet area in a build....

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....ceive a new residential flat of 660 sq. ft. carpet area in lieu of surrendering development rights and utilization of the FSI of the old flat. Thus, the assessee would be getting additional area of 210 sq. ft., the equivalent value of which in monitory terms was calculated by him at Rs. 16,05,515/-. He therefore taxed the said amount along with compensation received by the assessee under the head 'Income from other sources'. 4. In appeal before the ld. CIT(A), the ld. CIT (A) held that the compensation of Rs. 11,00,000/- as well as the monitory value of the additional area of the flat was taxable as capital gains. He also rejected the contention of the assessee that the additional FSI rights acquired by the assessee were embedd....

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....on the decision of Mumbai bench of Tribunal rendered in the case of Jetha Lal D Mehta (2 SOT 422) and other decisions rendered by the co-ordinate benches. 6. However, a perusal of the agreement entered by the assessee with the developer, which is titled as "AGREEMENT (individual member agreement) FOR PERMANENT ALTERNATE AGREEMENT" would show that the Society, in which the flat owned by the assessee was located, has obtained the land from the Government and the said Society has become lessee of the Government in respect of the said land. This fact is in total contradiction to the submissions made by the assessee, i.e., it is the society which is the lessee of land and not the assessee and other members. Hence, it cannot be said that the a....