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TMI Blog1992 (2) TMI 141X X X X Extracts X X X X X X X X Extracts X X X X ..... ts are that the assessee owned some agricultural lands at Sahibabad in the State of Uttar Pradesh. The said land was acquired for the purposes of the Ghaziabad Development Authority. Notifications under sections 4 and 6 of the Land Acquisition Act were issued on 16-7-1960 and 24-7-1968. Thereafter the possession of the land was taken from the assessee. The Land Acquisition Officer determined the compensation payable to the assessee at Rs. 35,968. The assessee challenged the same and later on the Ghaziabad Development Authority (in short " GDA ") made an offer to the assessee that if he withdraws his claim regarding the quantum of compensation then it would grant the assessee lease--hold plots equivalent to 40 per cent of the area of land ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he determined the capital gain at Rs. 47,582 (Rs. 1,04,086 minus Rs. 56,504). The assessee's contention that it was a long term gain was also not accepted. The assessee appealed to the DC (Appeals), who has upheld the Assessing Officer's order. 5. The assessee is now in appeal before us. The first ground raised in this appeal was about the ex parte decision of the appeal by the DC(A). This ground was not pressed and is accordingly rejected. 6. We are, thus, left with the question of the capital gains only. The learned counsel for the assessee contended that the case of this assessee is at par with that of gold bonds, in which the Board has clarified that no capital gain arises when the bonds are discharged by return of the gold to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... amount so payable for the acquisition of the assessee's land would be adjusted against the price of the plots to be allotted to the assessee. The area of the plots to be allotted to the assessee was to be 40 per cent of the area of agricultural land acquired from the assessee and in addition to the adjustment of the said claim of the assessee, the latter would have to pay Rs. 3,30,547 as development cost. As already stated the amount payable to the assessee in respect of the acquisition of the land would consist of three items, i.e., (i) the fair market value of the land as on the date of acquisition ; (ii) solatium for the acquisition of the land ; and (iii) interest till the date of actual payment. Solatium is a certain percentage of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d. This was only the amount offered which was not accepted and, therefore, loses its significance. In order to determine the cost of acquisition of the plots in question as on 13-9-1984 we have to determine what could be the amount payable to the assessee for the acquisition of the land (compensation, solatium and interest). Suppose this was an amount called ' X '. Thus, ' X ' plus Rs. 3,30,547 is equal to the cost of acquisition. If we can find out the value of ' X ', then we can determine the cost of acquisition. If it is not possible to determine the value of X, the cost of acquisition also becomes indeterminate and uncertain because in that event, we know only one part of the cost of acquisition, i.e., the sum of Rs. 3,30,547 and not th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t be ascertained. 7. There is, however, another way of looking at the things and it is this method that was adopted by the assessee initially. The GDA is a statutory public institution created by the State of U. P. It acquired lands for developing residential and commercial colonies etc, and after developing the land and creating the necessary infrastructure sold plots or built houses etc. on lease-hold basis to needy people. It has fixed rates for the allotment of plots and it cannot vary those rates from person to person or from plot to plot. Therefore, we can assume that the allotment to the assessee of the plots in question was also at the same price which the GDA would have charged from any other customer and after fixing the price i ..... X X X X Extracts X X X X X X X X Extracts X X X X
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