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TMI Blog2015 (11) TMI 1274X X X X Extracts X X X X X X X X Extracts X X X X ..... t. So, in the light of undisputed facts and law discussed above, the cost of acquisition of property in question in the hands of the assessee as has been claimed by Shri Damodar Das Batra, father of the assessee one of the co-sharer in the property in question to the extent of 1/3rd share. So, Ld. CIT(A) has committed patent illegality by considering the cost of acquisition. We, therefore, set aside the impugned order of the Ld. CIT(A) on this issue. - Decided in favour of revenue. - I.T.A. No. 3644/Del/2010 - - - Dated:- 30-9-2015 - SHRI N. K. SAINI, ACCOUNTANT MEMBER AND SHRI KULDIP SINGH, JUDICIAL MEMBER For The Appellant : Shri Sujit Kumar, Sr. DR For The Respondent : Shri Sudhir S Silwal, Adv. ORDER PER KULDIP SINGH, JM: The appellant, ACIT, Circle 32(1), New Delhi has field the present appeal and sought to set aside the order dated 26.05.2010 passed by Ld. CIT(A) XXVI, New Delhi on the grounds inter alia that:- 1) The Ld. CIT(A) has erred in deleting the addition of ₹ 4,18,050/- on account of Short Term Capital Gain on sale of property located at PNA-013, The Pinnacle, Gurgaon as the assessee has not disclosed the expenses relating to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssel Tower, Gurgaon by claiming sale consideration at ₹ 50,00,000/- and the cost of acquisition at ₹ 32,61,247/- (sale consideration ₹ 50,00,000 cost of acquisition ₹ 32,61,247 = STCG ₹ 17,38,753/-). However, the A.O. observed that the assessee has wrongly shown the cost of acquisition of the property at ₹ 32,61,247/- as against the actual acquisition cost of ₹ 21,27,723/- on the basis of the fact that there were three co-sharers in the property in question namely; Shri Sunil Batra, Shri Damodar Das Batra and Smt. Asha Batra, each having 1/3rd share and Shri Damodar Das Batra, father of the assessee has shown the cost of acquisition of ₹ 21,27,723/- only. Consequently, excess payment of costs of acquisition claimed by the assessee to the tune of ₹ 11,33,524/- has been added to the income of the assessee on the STCG. 6. Ld. CIT(A) deleted the additions made in the assessment order dated 21.12.2009. Feeling aggrieved, the Revenue has come up before the Tribunal by filing the present appeal. 7. At the very outset Ld. D.R. conceded that only grounds No. 1 2 are effective grounds to be argued before the Tribunal and contend ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... capital gains. These are expenditure incurred wholly and exclusively in connection with the transfer and the cost of acquisition of assets along with the cost of any improvement interest on capital for purchased property does not increase the cost of acquisition of asset (MLG Enterprises Vs CIT (Karnataka) (H.C.) 167 ITR 11 : ITO Vs Vikram Sadananda Hoskote (ITAT, Mum.) 1800 SOP 130). Therefore, the computation was done as per the provision of the I.T. Act, 1961. 8.3 Ld. D.R. by relying upon the judgement cited as CIT Vs Tata Iron Steel Co. Ltd. 231 ITR 285 (S.C.) contended that Ld. CIT(A) has wrongly ignored the law laid down by Hon ble Supreme Court in the judgement (supra) by adding the amount of ₹ 1,58,209/- as interest paid to Mrs. Gunjan Batra in the cost of acquisition. 8.4 Hon ble Apex Court in the judgement (supra) held as under: The manner of repayment of a loan cannot affect the cost of the assets acquired by the assessee. What is the actual cost must depend on the amount paid by the assessee to acquire the asset. The amount may have been borrowed by the assessee, but even if the assessee did not repay the loan it will not alter the cost of the asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... agreement / receipt dated 25.07.2006 by accepting part sale consideration of ₹ 43,51,500/- and the balance payment of ₹ 1,25,04,000/- was to be paid by the purchaser to the builder directly. Only after making the full and final sale consideration, the transfer of property was to be effected in the name of purchaser. 8.7 So far as the issue of making payment of commission charges of ₹ 30,000/- by the assessee to Shri K. P. Ganesh vide receipt lying at page 9 of the paper book filed by the assessee is concerned, again there is not an iota of evidence on record nor there is any reference in the receipt dated 25.07.2007 lying at page 2 of the paper book that ₹ 30,000/- has been paid as commission to Shri K P Ganesh, otherwise receipt dated 25.07.2006 would have contained the reference of payment of commission charges of ₹ 30,000/-. Had Shri K. P. Ganesh been the broker in the sale of property in question, he would have signed the receipt dated 25.07.2006 as witness. So, till the finalization of deal vide receipt dated 25.07.2006 Shri K. P. Ganesh was not in the picture nor the assessee has preferred to bring on record as to what services he has provided ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e A.O. on the basis of undisputed fact that Shri Sunil Batra assessee being coITA sharer in the property in question to the extent of 1/3rd share along with Shri Damodar Das Batra and Smt. Asha Batra had purchased the same for ₹ 50,00,000/- and as such the cost of acquisition qua each co-sharer comes to ₹ 21,27,723/- and by treating the cost of acquisition at ₹ 21,27,723/- computed the STSCG at ₹ 28,72,276/-at par with his (assessee) father Shri Damodar Das Batra, who has also 1/3rd share in the property and thereby made addition of ₹ 11,33,524 to the income of assessee. 9.2 Ld. CIT(A) by erroneously relying upon the judgement cited as CIT Vs Hindustan Petroleum Ltd., 98 ITR 167 (S.C.) and CIT Vs Mithlesh Kumari, 92 ITR 09 extended the relief of interest paid by the assessee on the borrowed loan of ₹ 35,00,000/- used for the purchase of property in question by adding the same to the cost of acquisition, which is not permissible under law and the judgements cited as Hindustan Petroleum Ltd. and Mithlesh Kumari (supra) are not applicable to the facts and circumstances of the case. 9.3 Hon ble Supreme Court in case cited as CIT Vs Tata Iron an ..... 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