9911796707
TMI Blog2012 (11) TMI 716X X X X Extracts X X X X X X X X Extracts X X X X ..... T(A) is arbitrary unjust, unwarranted, mala fide and illegal. 2. For that the Ld. CIT(A)'s action in enhancing the assessment on account of alleged short term and long term capital gains of Rs. 1062388/- and Rs. 1158620/- respectively without (a) rejecting the certificate issued by Sterlite Industries (India) Ltd. and (b) Without rejecting the Appellant's contention that capital gains under the Income-tax Act, 1961 can be levied only on the amount of net consideration received in excess of the cost of the capital asset. is arbitrary, unjust, unwarranted, mala fide and illegal. 3. For that there is no provision under the Income-tax Act, 1961 to charge capital gains tax on the market value of the capita ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lots were transferred to the persons as per the directions of the company in lieu of the settlement. The Assessing Officer worked out the capital gain being long term capital gains in respect of 1848 and short term capital gain in respect of 1368 shares on the basis of market price of the shares and accordingly, prayed the Commissioner of Income Tax (Appeals) to enhance the assessment to Rs. 11,58,620/- as long term capital gains and Rs. 10,62,388/- as short term capital gain. Consequently, the Commissioner of Income Tax (Appeals) enhanced the assessment to the extent of the above amounts as short term capital and long term capital gains. 5.2 The ld. AR of the assessee has submitted that the assessee trust was allotted initially16910 equit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... R has relied upon the order of the Commissioner of Income Tax (Appeals). 7. We have considered the rival submissions and carefully perused the relevant material on record. The assessee is an employees' welfare Trust of the Employees of M/s Sterlite Industries (I) Ltd. There is no dispute that the shares were allotted by the company to the assessee initially @ Rs. 180 per share and due to bonus issue, the cost price of the shares were reduced to Rs. 90 per share. During the year under consideration, as per the directions of the company, 3209 shares were transferred to 15 different parties in two lots. The assessee received from the company a sum of Rs. 2,88,620/- @ Rs. 90 per share. There is no allegation either by the Assessing Officer in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee has understated the sale consideration and actually received more sale consideration than shown by the assessee. Therefore, in the absence of any inference by the Commissioner of Income Tax (Appeals) that the assessee has concealed the actual sale consideration, the capital gain cannot be computed by taking the full value consideration as market value as on the date of transfer. On this point, there are series of decisions of honourable Supreme Court as well as honourable High Court as relied upon by the learned A.R. of the assessee. 9. In view of the above discussion, we hold that the market price of the shares cannot be taken as full value consideration for the purpose of computation of capital gain as per sec. 48 when there is ..... X X X X Extracts X X X X X X X X Extracts X X X X
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