9911796707
TMI Blog1979 (1) TMI 131X X X X Extracts X X X X X X X X Extracts X X X X ..... ture of Rs. 10,000 for constructing a part of building thereon during the period relevant to the asst. yr. 1970-71. On2nd Dec., 1971, the plot together with the structure raised thereon was transferred for a consideration of Rs. 1,09,000. The assessee claimed before the ITO that she had incurred an expenditure of Rs. 24,590 either as cost of acquisition of the property or as the cost of the improvement carried on thereto and, therefore, that amount should also have been deducted while working out the capital gains liable to tax. The ITO deducted only Rs. 5,368 and refused to deduct the balance of Rs.19,222. His order was confirmed by the AAC. 3. The assessee is now in appeal before us against the above action of the lower authorities. We ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mount from consideration. 6. The next item is of Rs. 1,262. This consists of two items of Rs. 480 being the ground rent upto31st March, 1961and Rs. 782 being the ground rent for the period1st April, 1961to30th Sept., 1970. The ITO disallowed it from deduction on the ground that the expenditure did not relate to the assessment year under consideration. The AAC held that such an expenditure was only by way of payment of dues levied on the owner of the land and, therefore, it did not go to improve the land. After hearing the parties, we are of the opinion that the lower authorities went wrong in their approach. The expenditure which the assessee was required to pay for the period before she was put in possession of the plot has to be treated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd Rs. 3,811. The first relates to the period1st April, 1953to31st March, 1961and the second related to the period 1st April, 1961to31st March, 1971. Any payment made for the period before the assessee came into possession of the plot has to be treated as the cost of its acquisition. Such amount a being Rs. 728 has, therefore got to be allowed in computing the capital gains. The balance of Rs. 3,811 can neither be treated as the cost of the acquisition of the capital asset nor as cost of its improvement. The disallowance has, therefore, to be confined to Rs. 3,811. 9. The next item is of Rs. 7,233 being the salary of Chowkidar. The reasons for disallowing this item are also the same which have been mentioned above. We find that the amount ..... X X X X Extracts X X X X X X X X Extracts X X X X
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