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2018 (6) TMI 351 - ITAT PUNESale of development rights as adventure in the nature of trade - capital gains - entitled to claim deduction under section 54F - CIT's powers to enhance an assessment - Held that:- CIT(A) was not only changing the head of income but was also enhancing the assessment, since income which is assessed in the hands of assessee as per direction of CIT(A) had worked out at ₹ 49,41,225/- as against income assessed by the Assessing Officer under the head Long Term Capital Gain at ₹ 48,75,610/-. The second aspect is rate of tax. In case income is assessed under the head Long Term Capital Gain, the rate of tax is lower than the rate applied when the income is being assessed as business income. In view thereof in not giving an opportunity or any show cause notice of enhancement as required under section 251(2) the order of CIT(A) suffers from infirmity and the same cannot be sustained. After assessing income as Long Term Capital Gain, AO proposed to assess income as income from other sources, as per his comment in the remand report, which was confronted to the assessee; but when the income was assessed as business income, no notice whatsoever, was given by CIT(A). Accordingly, we hold that the enhancement made by CIT(A) does not survive. Thus, we reverse the order of CIT(A). The income was assessed in the hands of assessee as income from Long Term Capital Gain. CIT(A) has decided the issue of entitlement of claim under section 54F and held the assessee to be eligible for said claim. Revenue is not in appeal against the order of CIT(A). Accordingly, we direct the Assessing Officer to allow claim of assessee under section 54F - Decided in favour of assessee
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