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2016 (7) TMI 1393 - HC - Income TaxApplicability of Section 50C - It is the case of the revenue that Section 50C would apply also to transfer of leasehold interest in land and is not limited to only to transfer of land and building or both - Held that - The impugned order of the Tribunal allowed the respondent assessee s appeal by following its own decision in Atul G. Puranik V. ITO 2011 (5) TMI 576 - ITAT Mumbai as held that Section 50C of the Act would apply only to a capital asset being land or building or both and it cannot apply to transfer of lease rights in a land. No substantial question of law.
Issues:
1. Interpretation of Section 50C of the Income Tax Act, 1961 regarding the applicability to the transfer of leasehold rights. Analysis: The High Court of Bombay heard an appeal challenging the order passed by the Income Tax Appellate Tribunal concerning the Assessment Year 2007-08. The main issue raised in the appeal was whether Section 50C of the Income Tax Act, which deals with the valuation of capital assets for computing capital gains, is applicable to the transfer of leasehold rights in addition to land or building. The Revenue contended that Section 50C should also apply to the transfer of leasehold interest in land, not limited to land or building. However, the Tribunal had previously held in Atul G. Puranik V. ITO that Section 50C only applies to land or building, not to the transfer of lease rights in land. The Tribunal's decision in Atul G. Puranik was followed in the present case, leading to the dismissal of the Revenue's appeal. The Court noted that the Revenue had not appealed the decision in Atul G. Puranik, indicating acceptance of that judgment. Since the facts of the current case were similar to those in Atul G. Puranik, no substantial question of law arose for consideration. Consequently, the Court dismissed the appeal, stating that the question as framed did not give rise to any substantial legal issue and thus was not entertained. The appeal was ultimately dismissed, and no costs were awarded.
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