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TMI Blog2015 (4) TMI 913X X X X Extracts X X X X X X X X Extracts X X X X ..... le jurisdictional Delhi High Court in the case of Arun Shungloo Trust [2012 (2) TMI 259 - DELHI HIGH COURT]holding that the assessee trust having acquired the property in trust on 05.01.1996, which property was acquired by the previous owner sometime before 01.04.1981 on sale of property by the assessee in 2001-02, it was entitled to the benefit of indexed cost of acquisition from 01.04.1981 and not for the period on or after 05.01.1996. The ratios laid down in these decisions also support the finding given by the Learned CIT(Appeals) on the issue. We thus do not find any reason to interfere with the first appellate order in this regard. The same is upheld. The grounds are accordingly rejected. - Decided against the revenue. - ITA No. 1420/Del/2011 - - - Dated:- 17-2-2015 - SHRI N.K. SAINI AND SHRI I.C. SUDHIR JJ. For the Appellant : Shri Vikram Sahay, Sr.DR For the Respondent : S/Shri Rakesh Gupta, Adv. Ashwani Taneja, CA ORDER Per I.C. Sudhir: JUDICIAL MEMBER The Revenue has questioned first appellate order on the following grounds: 1. On the facts and in the circumstances of the case, the Learned CIT(Appeals) has erred in accepting the ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ished his rights over the vacant plot for consideration of ₹ 21 lacs and the entire ground floor was to be constructed in the financial year 2003- 04. He observed that the assessee had acquired the ground floor of the property vide collaboration agreement dated 10.2.2004 and sold the same for ₹ 50 lacs on 07.12.2006 i.e. within a period of 36 months from the date of acquisition of the property. He, therefore, held that the capital gain arising from the sale of ground floor of property should be short term instead of long term and no exemption under sec. 54EC is to be allowed against the same. He held that cost of acquisition of property is to be taken at nil as the benefit of fair market value of the plot of land as on 01.04.1981 has already been provided to the assessee while computing the long term capital gain for the financial year 2003-04. The Learned CIT(Appeals) has, however, accepted the claim of the assessee, hence, Revenue is in appeal on the above grounds. 4. In support of the grounds, the Learned DR has basically placed reliance on the assessment orders. He submitted that the Learned CIT(Appeals) has ignored the material aspect of the case noted by the As ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... involved is as to whether the gain earned by the assessee should be assessed as long term capital gain and corresponding amount of exemption available to the assessee under sec. 54EC should be granted to the assessee. 7. Considering the above submissions, the material facts are that the assessee had inherited the property from his mother who had purchased the land on 28.1.1974. On 10.2.2004, the assessee entered into a collaboration agreement with the builder as per which the builder had to provide constructed ground floor to the assessee at his own cost and also had to pay ₹ 21 lacs which was paid in the year 2004 with this further understanding that the basement, ground floor, second floor along with terrace rights will remain with the builder. Vide sale deed dated 7.12.2006, the assessee sold the ground floor for ₹ 50 lacs. The Assessing Officer observed that the assessee had relinquished his rights over the vacant plot for the consideration of ₹ 21 l.acs and the entire ground floor was to be constructed in the financial year 2003-04, hence, the resultant capital gain/loss should have been arisen in the assessment year relevant to the financial year 2003-04 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 0-02- 2004 entered by the Assessee. The AO has ruled that the entire plot of land was transferred in 2004 whereas the assessee's submissions are that share of land of Ground floor was not transferred in 2004 and it was sold in 2006. To know what has been transferred we will have to examine the relevant clauses in collaboration agreement. Relevant clauses of the collaboration agreement are at page 6 which are reproduced below That in lieu of the portion made available by the owner to the builder for development of the said property, the owner shall be entitled to : OWNER'S ALLOCATION Entire Ground Floor portion with one servant quarter Common toilet on the terrace of the building alongwith one car parking in the drive way, in /of the said property .alongwith proportionate undivided, indivisible and impartible land rights/ share underneath the Building measuring 400 sq.yds., together with right to use/avail common areas and facilities and easements attached thereto. That in lieu of the Builder developing the portions/property, using his infra- structural facilities and at his own cost paying the aforesaid amount to the owner, the Builder shall be entitled to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... proportionate cost of land of ground floor would be 8,36,125 X 167.22/649.60 which comes to ₹ 2,15,235 as on 1-4-81. The AO's VIew was that there is transfer of land in 2004 to builder by assessee, and hence L TCG should be computed at that time. However due to composite contract of transfer of land with respect of ₹ 21 lakhs and ground floor, there is no transfer in 2004 as per appellant's argument. The appellant treats the transfer only once i.e. in 2006, when the building was complete and ready for sale. The AO treats that there are two transfers with respect to time i.e. one on the date of building collaboration agreement with builder and the other transfer on the date of sale of ground floor with portion of land apurtenant there to with ground floor. In a civilized urban population, such type of transfer of land and building in multi-storeyed structures will come now and them in all cities. Since the case of assessee is covered by may ITATs, H.C.s, I hold the appellant's view as correct. For cost of superstructure sold in 2006 by the assessee, the assessee's has submitted valuer's certificate. This value of ₹ 19,20,000 should be take ..... X X X X Extracts X X X X X X X X Extracts X X X X
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