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TMI Blog2015 (2) TMI 500X X X X Extracts X X X X X X X X Extracts X X X X ..... Court, on that occasion had to deal with a property transaction and whether a sale transfer, based upon confirming a GPA, amounted to sale or conveyance. That decision did not consider - rather had no occasion to deal with Sections 2(14) and 2(47) in the context of a claim of acquisition of rights of property and interest in a capital asset, for the purpose of income tax. - Decided against revenue Whether improved cost was deducted - Held that:- This Court has no manner of doubt that the Revenue does not dispute the acquisition of second property at Model Town. Given that the Revenue does not dispute that the second transaction of purchase took place, it has to necessarily follow that the cost of improvement was deductible. No substantia ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment order, rejected the assessee s contention and held that in the absence of an agreement to sell, the rights acquired by the provisional booking of the property did not meet with the requirements spelt out under Section 64, i.e. acquisition of new capital asset. The AO also held that the improved cost was not deductible. The CIT (Appeals) accepted the assessee s contention and directed the deletion of both amounts. The Revenue unsuccessfully appealed to the ITAT. 3. It is argued by Mr.Rohit Madan, learned counsel on behalf of the Revenue that the AO s position with respect to acquisition of a new capital asset was correct. He said that the ITAT s reliance on CIT vs. R.L. Sood (2000) 245 ITR 727 and the ruling in Suraj Lamps and Indust ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Commissioner of Income Tax (ITA No.55/2014, decided on 14.03.2014) had the occasion to, inter alia, consider what amounted to acquisition of a capital asset - though in the context of a claim that capital gains had accrued due to the sale of the property. The facts in that case were that the assessee had booked a flat, and was recipient of a provisional allotment letter. Subsequently, the transaction was converted into a written agreement to sell. The Court, noting the contentions of the parties and also, significantly, taking note of the definition of transfer and capital asset , was of the opinion that capital asset has been defined in extremely wide terms - A reference to Section 2(47), which defines transfer , and particularly its ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e to the apartment are also capital assets that can be transferable. 6. In the present case the question is not whether the assessee sold the booking rights and was, therefore, entitled to benefit of capital gains. It is, rather, whether his entering into the transaction and acquiring a property for ₹ 73,27,000/- (acquisition cost) amounted to his acquiring a capital asset. In the light of the definitions of capital asset under Section 2(14) and transfer under Section 2(47) as discussed in Gulshan (supra), this Court has no doubt that the assessee s contentions were merited. The reference to Suraj Lamps (supra), in the Court s opinion, is of no consequence because the Supreme Court, on that occasion had to deal with a property ..... X X X X Extracts X X X X X X X X Extracts X X X X
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