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TMI Blog2016 (2) TMI 346X X X X Extracts X X X X X X X X Extracts X X X X ..... d upon the assessee a right to hold the flat. The mere fact that possession of the flat was delivered later does not detract from the fact that the allotment was conferred with a right to hold the property on issuance of an allotment letter. The payment of balance installments and delivery of possession are consequential acts that relate back to and arise from the rights conferred by the allotment letter. In this view of the matter, the transaction was held to LTCG. Capital gains arising from sale of the said Flat No. 702, Mumbai Central, Mumbai by the assessee is to computed as LTCG as the period of 36 months is to be taken from 18/10/2005, i.e. the date of allotment to 11/12/2009 i.e. the date of sale. We accordingly uphold the order o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Income Tax Act, 1961 (in short the Act ) and the case was taken up for scrutiny. The assessment was completed u/s 143(3) of the Act vide order dt. 12/03/2013, wherein the total income of the assessee was determined at ₹ 60,85,170/-. On appeal, the Ld. CIT(A) vide order dt. 28/04/2014 allowed the assessee the relief claimed by it, by taxing the sale of a property as Long Term Capital Gains (LTCG ) and, also by allowing the assessee s claim for exemption u/s 54F of the Act. 3.1 Aggrieved by the order of the CIT(Appeals-27, Mumbai dt. 28/04/2014, the revenue has preferred this appeal before the Tribunal raising the following grounds:- 1. Whether on the facts and circumstances and in law, the Ld. CIT(A) is right in treatin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment letter dt. 18/10/2005, the assessee had already paid on amount of ₹ 10,00,000/- and the balance was to be paid subsequently in installments till possession. The Ld. AR submitted that the AO did not accept the assessee s computation of LTCG as he was of the view that since the agreement for purchase of the said that from Parekh Holdings was dt. 27/02/2009, the assessee could become the owner and obtain possession of the building only after payment of the full consideration for purchase from that date i.e. 27/02/2009. In that view of the matter, the AO had proceeded to reject the assessee s computation of LTCG, and re-computed the said transaction as Short Term Capital Gain ( STCG ). The AO also rejected the assessee s claim for ex ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cedents and facts of the case on hand, it was prayed that the impugned order of the Ld. CIT(A) holding that since the aforesaid property was transferred by the assessee after for holding it for a period exceeding 36 months, the assessee was entitled to claim LTCG and the attendant benefit of exemption u/s 54F of the Act. 3.3.1 We have heard the rival contentions and perused and carefully considered the material on record, including the judicial decisions cited. From the details on record, we find that the assessee sold the said property at Flat No. 702, Mumbai Central on 11/12/2009; computed LTCG thereon, and claimed exemption u/s 54F of the Act on the investment made in purchase of another property, whereby the taxable Capital Gains was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... precedents in the matter, the Bench held as under:- 19 We have heard both the parties and have perused the case laws cited by both the sides. The AO has held that the gain of the assessee from the sale of the said flat to be shortterm capital-gain on the reason that the sale of Flat on 16.07.2009 was only after the assessee had obtained the possession of these flats on or after 27.06.2008. The said basis adopted by the AO cannot be countenanced because of the law laid down by various judicial precedents on the subject in hand and also it is factually incorrect to state that the flats were taken on possession by the assessee on or after 27.06.2008, for the simple reason that a perusal of the sale agreement itself would reveal that the f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... llotted a Flat on 07/06/1986 and paid the first installment on 04/07/1986. Possession of the flat was given subsequently. The assessee then sold the flat on 05/07/1989. In the return of income the assessee disclosed the capital gain arising from the sale of flat as LTCG. The authorities below treated the capital gain arising there from as STCG. Their Lordships held that the capital gains arising from the sale was LTCG. At para 7 thereof, their Lordships have observed that when the assessee paid the first installment on 04/07/1986 after allotment on 07/06/1986, this act conferred upon the assessee a right to hold the flat. The mere fact that possession of the flat was delivered later does not detract from the fact that the allotment was conf ..... X X X X Extracts X X X X X X X X Extracts X X X X
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