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TMI Blog2012 (11) TMI 902X X X X Extracts X X X X X X X X Extracts X X X X ..... ent of cost is altogether inconceivable. - CIT v. B.C. Srinivasa Setty [1981 (2) TMI 1 - SUPREME COURT] As the land in question was not having cost because the same was allotted to father of the assessee being refugee from Pakistan by Government of India at relevant point of time which is not in dispute. So the land in question was acquired by father of the assessee free of cost. Therefore, there is no question of capital gain on transfer of such land and enhanced compensation reeived is not chargeable to tax - in favour of assessee. - IT APPEAL NO. 220 (PN) OF 2011 - - - Dated:- 26-7-2012 - SHAILENDRA KUMAR YADAV AND R. K. PANDA, JJ. Sunil Pathak for the Appellant. Ms. Ann Kapthuama for the Respondent. ORDER Sh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... me on 31.03.2008 declaring total taxable income of Rs.97,750/- and Rs.34,000/- as agricultural income. Assessee received compensation amounting to Rs.26,33,433/- from Special Land Acquisition Officer (hereinafter called SLAO) Panvel, District Alibaug, on 04.11.2006. The said compensation had not reached finality at relevant point of time as the matter is sub-judice before the Hon'ble High Court. The assessee, during assessment proceedings, claimed that amount under reference was agricultural land and, therefore, enhanced compensation of Rs.7,01,781/- and interest thereon of Rs.19,31,652/- u/s.28 was outside the purview of the capital gain tax under Income Tax Act, 1961. The Assessing Officer did not agree with the contention that land in qu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r by Govt. of India because his family migrated from Pakistan and took shelter at relevant point of time, there was no cost to the assessee nor the cost of acquisition was determinable. The CIT(A) also failed to appreciate that cost of acquisition was not determinable and hence compensation thereon could not be taxed as long term capital gain. The Ld. Authorised Representative relied on the decisions of (a) ITAT, Pune 'A' Bench in the case of ITO v. Pashu Mohammed Zainuddin [2012] 50 SOT 45 (b) CIT v. H.H. Sri Raja Rajagopala Thandaiman [2006] 282 ITR 126 (Mad.), (c) CIT v. Manoharsinh P. Jadeja [2006] 281 ITR 19 (Guj.), and (d) CIT v. Markapakula Agamma [1987] 165 ITR 386. In view of the above legal and factual discussion, th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ement of cost is either actually present or is capable of being reckoned and not in respect of those assets in the acquisition of which, the element of cost is altogether inconceivable. In the present case, the land was acquired by the assessee's ancestor free of cost as Inami land as Choli Bangdi for maintenance and services of Dargah Peer Bahuddin Bhandari shah. Therefore, any element of cost in an acquisition of aforesaid land by the ancestors of the assessee is inconceivable. Further in case of Inami land as Choli Bangdi there being no cost of acquisition, the question of capital gain does not arise. In this view of the matter, the order of the CIT(A) does not call for any interference at our hand. We uphold the same and dismiss the gro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is on Revenue, if Revenue failed to show that assessee had incurred a cost, it would be impossible to compute the income chargeable to tax under the head capital gains. By Finance Act, 1987m w.e.f. April 1st, 1988, the amended section 55 of the Act only ropes in taxability of goodwill on transfer of the same even if there is no cost of acquisition. Similarly, section 55 has been amended from time to time to enable taxability of other assets wherein no cost of acquisition is envisaged. Therefore, even if amendment is taken into consideration, section 55 can be invoked in case of nil cost of acquisition for the purpose of bringing tax the entire sale consideration only in relation to specified assets, as held in CIT v. Manoharsinhji P. Jadej ..... X X X X Extracts X X X X X X X X Extracts X X X X
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