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TMI Blog2016 (2) TMI 570X X X X Extracts X X X X X X X X Extracts X X X X ..... of acquisition has to be computed with reference to the year in which the previous owner first held the asset (i.e. the assessee's late mother first held her 50% share in the said property by inheritance on the expiry of her husband on 11.11.1963) and not in the year in which the assessee became the owner of the asset, viz. in 2006. We, accordingly, hold and direct the AO to allow indexation of the cost of acquisition of the said property entirely w.e.f. 01.04.1981. - Decided in favour of assessee X X X X Extracts X X X X X X X X Extracts X X X X ..... sment passed under section 143(3) of the Act vide order dated 21.11.2011. 2.2 Aggrieved by the order of assessment for A.Y. 2009-10, the assessee preferred an appeal before the CIT(A)-10, Mumbai. The learned CIT(A) disposed off the appeal vide the impugned order dated 26.03.2013 allowing the assessee partial relief. In the impugned order, the learned CIT(A): (i) upheld the AO's action in denying the assessee's claim for exemption under section 54 of the Act, and (ii) following the decision of the Hon'ble Bombay High Court in the case of CIT vs. Manjula J. Shah (2013) 355 ITR 474 (Bom) directed the AO to allow indexation of the cost of acquisition w.e.f. 01.04.1981 in respect of the said property. 3. Both Revenue and the assessee are aggrieved by the impugned order of the learned CIT(A)-10, Mumbai dated 26.03.2013 for A.Y. 2009-10 in respect of the issues adjudicated against them. We proceed to dispose off the cross appeals hereunder. Assessee's appeal for A.Y. 2009-10 in ITA No. 3478/Mum/2013 4. The ground raised by the assessee in this appeal are as under:- "1:0 Re.: Non-granting of exemption available u/s. 54 of the Income-tax Act, 1961: 1:1 The Commi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ated 13.05.2015. In that case the Coordinate Bench, after considering the facts of that case at para 2 thereof, allowed the assessee's claim for exemption under section 54 of the Act on account of investment in the acquisition of a new property outside India. In doing so the Coordinate Bench followed the decision of another Coordinate Bench of this Tribunal in the case of Girdhar Mohanani and Smt. Varsha Girdhar in ITA Nos. 4591 & 4592/Mum/2013 dated 06.05.2015. In its order in the case of Ms. Dhun Jehan Contractor (supra) the Coordinate Bench at paras 6 & 7 thereof held as under:- "6. Having considered the rival submissions as well as the relevant material on record, we find that a similar issue has already been decided by the coordinate bench of the Tribunal in the case of Mr. Girdhar Mohanani & Mrs. Varsha Girdhar in ITA Nos.4591 & 4592/Mum/2013 decided on 06.05.15 and the relevant finding in paras 4 to 9 is as under: "4. We have considered rival contentions and found that during the year assessee has claimed exemption u/s.54. Out of the sale consideration of ₹ 87,37,291/-, assessee has deposited ₹ 50 lakhs in capital gains in scheme account. Subseq ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) Bill, 2014. There is no reason to decline exemption u/s.54 during the A.Y.2010-11 under consideration. 8. The provisions contained in sub-section (1) of section 54 of the Income-tax Act, before its amendment by the Act, inter alia, provided that where capital gain arises from the transfer of a long-term capital asset, being buildings or lands appurtenant thereto, and being a residential house, and the assessee within a period of one year before or two years after the date of transfer, purchases, or within a period of three years after the date of transfer constructs, a residential house, then, the amount of capital gains to the extent invested in the new residential house is not chargeable to tax under section 45 of the Income-tax Act. 9. In view of the above, we hold that during the year under consideration, assessee was entitled for exemption u/s.54 even if investment was made in residential house situated outside India, provided that assessee has to comply with other conditions of Section 54. Since the AO has out-rightly declined exemption on this plea without examining the other conditions of Sec.54 so as to make assessee eligible, we accordingly restore the appeal to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... from the 1st year of acquisition in which the asset was held by him. 3. The appellant prays that the order of the Ld. CIT(A), Mumbai on the above ground(s) be set aside and the order of the Assessing Officer be restored. 4. The appellant craves leave to amend or alter any ground or add a new ground which may be necessary." 8. The grounds raised at S.Nos. 3 and 4 (supra) by Revenue being general in nature, no adjudication is called for thereon. 9. Grounds at S.Nos. 1 & 2: Dates to be adopted for Indexed Cost of Acquisition 9.1 In these grounds, the Revenue has assailed the decision of the learned CIT(A) in allowing the assessee's claim for indexation of the cost of acquisition w.e.f. 01.04.1981 by following the decision in the case of Manjula J. Shah (2013) 355 ITR 474 (Bom) since this decision has not been accepted by the Department. The learned D.R. was heard in this matter and he placed strong reliance on the AO's order on the issue. 9.2 Per contra, the learned A.R. for the assessee submitted that there was no error in the impugned order of the learned CIT(A) in allowing the assessee's claim for indexation of cost of acquisition of the assessee's flat ..... X X X X Extracts X X X X X X X X Extracts X X X X
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