9911796707
TMI Blog2014 (3) TMI 58X X X X Extracts X X X X X X X X Extracts X X X X ..... f the owners/transferers of the land to ward off any charge and encumbrances arises in the property –thus, there was no substance in the argument of the revenue that in the absence of any specific mention in the agreement such payment is not allowable deduction - The payment has been made for removal of encumbrances in respect of the property in question being relocation of the hutment dwellers - this falls under the category of expenditure incurred in connection with transfer of the property – Decided in favour of Assessee. Benefit of indexation of cost of acquisition – Held that:- The decision in CIT Vs Manjula J. Shah [2011 (10) TMI 406 - BOMBAY HIGH COURT] followed – The AO has not disputed the fact that the property in question has ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... set, from the date on which the asset was held by the assessee instead of from the date of acquisition by the previous owner. 3. Ground No. 1 2 regarding disallowance of Rs.5,00,000/- as deduction of expenditure incurred in connection with the transfer. The original assessment u/s 143(3) was passed on 31.12.2008. Subsequently, the CIT set aside the assessment vide order dated 9.12.2009 passed u/s 263 and directed the A.O in para 4 as under: 4. On going through the assessment records, I find that page 8 is missing from the photo copy of the transfer agreement filed before the A.O. It is, therefore, clear that the A.O's decision was taken in absence of this evidence which has been produced for the first time before me. Since ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... greement in question does not speak about any payment to the consenting party and therefore, there is no such liability as per the agreement. This so called encumbrances in the shape of settled hutments was already in exist at the time of agreement and when nothing has been mentioned in the agreement about the payment towards removal of these hutments this payment cannot be allowed as deduction being expenditure in connection with transfer. He has relied upon the orders of the authorities below. 6. We have considered the rival submissions and careful perused the relevant material on record. The assessee was a co-owner of land plot No. 313, CA No. 929B at village Bhambardi, Pune. The leasehold rights in respect of plot were sold to M/s Ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as well as CIT(A). The disallowance has been made on the ground that the transfer/development agreement does not speak about such payment. When the payment is undisputedly made towards relocation of hutment dwellers then it is certainly for the purpose of removing the encumbrances in the title of the owners in respect of the land in question. As per clause 10 of the development agreement dated 10.9.2004 it is obligatory on the part of the owners/transferers of the land to ward off any charge and encumbrances arises in the property. Therefore, we do not find any substance or merit in the argument of the revenue that in the absence of any specific mention in the agreement such payment is not allowable deduction. The payment has been made for ..... X X X X Extracts X X X X X X X X Extracts X X X X
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