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TMI Blog2014 (3) TMI 324X X X X Extracts X X X X X X X X Extracts X X X X ..... cquiring the right which has been transferred and computational mode given in section 48, therefore, taxing under the head capital gain by the AO cannot be sustained - – Decided against Revenue. - ITA No. 3257/Mum/2011, ITA No. 3856/Mum/2011, C. O. No. 164/Mum/2011 - - - Dated:- 26-2-2014 - Sh. B. R. Mittal And Rajendra, JJ. For the Petitioner : Shri Ashim K. Modi For the Respondent : Shri Vimal Punmiya ORDER Per Rajendra, A. M: Challenging the orders dt. 27. 01. 2011 of the CIT(A)-33, Mumbai, Assessing Officer(AO) and assessee have filed Cross Appeals for the year under consideration. Assessee has also filed cross objections. Grounds of appeal filed by the AO read as under:- 1. On the facts and circumstances of the case and in law, the Ld. CIT(A) erred in accepting the cost of acquisition of the additional 0. 25 FSI at Rs. 35, 55, 290/- as against the estimated cost of acquisition at NIL by the A. O. 2. On the facts and circumstances of the case and in law, the Ld. CIT(A) erred in accepting the cost of acquisition as above and ignoring the terms of MOU, whereby the assessee had received compensation in respect of surrender of right of penalty and t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... his directions, AO held that assessee had received Rs. 75 lacs from release of rights in favour of Contractors, that society had entered into an agreement with the developer. He directed the society to furnish the basis of determination of cost of acquisition. assessee submitted that the society permitted the contractor to get additional 0. 25 FSI and purchase of transferable development rights (TDR) for construction of extra flats. As per the AO, in absence of any details of how many flats were constructed against the FSI and what was the cost liability the society had to bear towards it cost of acquisition could not be apportioned, that mere granting of permission to allow use of TDR does not involve payment of any amount, that member of society had been given flats/bunglows, that members had given only permission for allowing uses of extra FSI and TDR, that the assessee did not bear any cost towards TDR/FSI. Referring to the agreement entered in to by the assessee-society and the contractor dated 26. 06. 1994, he further held that there is no cost borne by the assessee towards additional FSI and permission for use of the TDR, that it had not furnished the basis for arriving at f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for Rs. 142. 32 lacs, that the conveyance for the said land was made in the name of assessee vide conveyance deed dated 08. 04. 2003 (F. Y. 2003-04), that the asset came into existence in AY. 2004- 05, that Cost Inflation Index had to be taken for the year 2004-05 and not of 1990 as has been claimed by the assessee, that by MOU dated 27. 07. 2005 the assessee had to receive Rs. 75 lacs, that out of that Rs. 50 lacs were received by the assessee in Assessment Year 2006-07 and balance Rs. 25 lac in AY. 2007-08, that the total sale consideration of 0. 25 extra FSI and right to utilise TDR was Rs. 75 lakhs as the additional 3 flats with purchase back price of Rs. 31. 35 lacs along with the right to charge penalty was surrendered for this amount, that the total cost of acquisition of Rs. 142. 32 lakhs had to be appropriated for 0. 25 FSI i. e. 16400 sq. ft. in F. Y. 2003-04 relevant to AY. 2004-05, that the gain was short term as transaction was completed within a period of 36 months from date of purchase i. e. 08. 04. 2003. She worked the Capital Gain at Rs. 35. 14 lakhs. He further held that the Short Term Capital Gain(STCG) chargeable in the case was Rs. 35, 14, 697/- as against Lon ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was handed over to the society, that dispute arose between the developer and the assessee and it continued till year 2001, that in Oct, 2001 consent terms were executed between various parties in City Civil Court, that in year 2004 deed of conveyance was signed in favour of the assessee, that on 21. 07. 2005 MOU was signed between the assessee and the developer, that because of change in Rules society got FSI of 0. 25 initially, that later on FSI was increased to 1, that TDR was also available to the assessee, that FSI and TDR had no cost, that same were not taxable, that developer had paid compensation to the society, that consideration received on grant/surrender of right to use of additional FSI and TDR was capital receipt and was not chargeable under the head capital gains, that for additional TDR/FSI the assessee had not incurred any cost, i. e. cost was nil, that AO had taken cost as nil, that FAA had disturbed the cost of acquisition. AR referred to page no. 193 to 228 of the paper book. He relied upon the cases of Shri Ram Kumar Malhotra(2010TIOL512 ITAT-Mum), Om Shanti Co-op HSG Society(ITA/2550/ Mum/2008), Maheshwar Prakash -2Co. OP. HSG Society (118ITD223), New Shailaja ..... X X X X Extracts X X X X X X X X Extracts X X X X
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