2012 (5) TMI 799 - AT - Income Tax

Summary

Issues involved: Appeal against assessment order u/s 143(3) for AY 2007-2008 regarding long term capital gain on transfer of properties in Mumbai.

Facts: Assessee, an individual, acquired properties in 1994-1995 and 1995-1996, sold them in AY 2007-2008, initially declared long term capital gain at Rs. 1,08,24,593. Revised return filed within time limit after realizing cost of acquisition should be from date of agreement, not payment dates.

Assessing Officer's Decision: Rejected claim, assessed gain at initial amount, citing non-acceptance of ITAT Mumbai Bench decision in similar case.

CIT(A) Decision: Appreciated assessee's explanation, directed assessment based on agreement date for cost of acquisition, not payment dates, in line with ITAT Mumbai Bench decision.

Arguments: Senior DR contested CIT(A) decision, while AR supported it with other ITAT Mumbai Bench decisions on similar issue.

ITAT Decision: After considering arguments and relevant findings, upheld CIT(A) decision to compute gain from agreement date, not payment dates. Cited various judgments supporting this approach.

Conclusion: Benefit of indexation to be given from agreement date for property acquisition, not payment dates. CIT(A) decision upheld, revenue's appeal dismissed.