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Issues:
1. Whether referable questions of law arise out of the Tribunal's order for the assessment years 1974-75 and 1975-76. 2. Determination of the cost of acquisition of a property for capital gains calculation. 3. Applicability of Section 54 for claiming exemption on capital gains for residential property. 4. Treatment of capital gains for the assessment year 1975-76 on the commercial portion of the property. Analysis: 1. The primary issue in this judgment was whether referable questions of law arose from the Tribunal's order for the assessment years 1974-75 and 1975-76. The CIT sought reference of questions to the High Court, contending that legal issues were present. However, the Tribunal found that the disposal of the issue was primarily factual, and no referable question of law existed. The Tribunal dismissed the reference applications based on this analysis. 2. The Tribunal delved into the determination of the cost of acquisition of a property for calculating capital gains. The property in question was acquired through partial partition of a Hindu Undivided Family (HUF). The Tribunal analyzed the provisions of Section 49, which deem the cost of acquisition to be the cost for which the previous owner acquired the asset. The Tribunal scrutinized conflicting claims regarding the property's value as on 1st January 1954, ultimately determining the cost of the property for capital gains calculation. 3. Regarding the applicability of Section 54 for claiming exemption on capital gains for a residential property, the Tribunal emphasized that the HUF had purchased a property with the entire sale proceeds within two years for residential purposes. The Tribunal interpreted Section 54 liberally, asserting that the HUF's capability to use the property as its residence qualified for the exemption, thereby negating any capital gains for the assessment year 1974-75. 4. For the assessment year 1975-76, the Tribunal analyzed the treatment of capital gains on the commercial portion of the property used for self-business. Calculating the cost of the commercial portion and the sale proceeds, the Tribunal determined the capital gains. It classified the capital gains as long-term due to the legal fiction regarding the property's ownership and cost as on 1st January 1954. Despite the capital gains on the commercial portion, the Tribunal's analysis established the nature of the gains and the applicable provisions. In conclusion, the Tribunal dismissed the reference applications, emphasizing the factual nature of the issues and the absence of referable questions of law. The detailed analysis provided clarity on the determination of the cost of acquisition, the application of Section 54 for exemptions, and the treatment of capital gains for the commercial portion of the property, ensuring a comprehensive understanding of the judgment.
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