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TMI Blog2016 (5) TMI 333X X X X Extracts X X X X X X X X Extracts X X X X ..... ion 2(42A) of the Act and in the present case, assessee deemed to hold the property as on 1981 and indexed cost of acquisition has to be calculated from 01.04.1981 with the base year as 100. The assessee’s father acquired property in 1965-66 along with his brothers and on partition in 1979, he became the absolute owner of entire asset and assessee has complied with the conditions of the previous owner as on 01.04.1981 and rightfully claimed the cost in inflation indexation from the base year i.e. 01.04.1981 and the arguments of the ld.A.R are supported by the decision of Co-ordinate Bench of this Tribunal in the case of ITO Vs. Shri Syed Ali Shirazhi [2014 (10) TMI 888 - ITAT CHENNAI] following the decision of Special Bench in the case of M ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d on the assessee and certain modes of acquisition as per section 49(1) of the Act. 3.1 The brief facts of the case are that the assessee is an individual, and filed e-return on 30.09.2011 with total income of ₹ 54,62,079/-. The return was process u/s.143(1) of the Act and ws selected for scrutiny and notice u/s.143(2) was issued to the assessee. The Authorised Representative of assessee appeared from time to time and furnished the details called for during assessment proceedings. The Assessing Officer found that the assessee has disclosed long term capital gains of ₹ 43,72,592/- and income from other sources of ₹ 12,12,895/- The assessee, his mother and sister being the co-owners of the two immovable properties hold eq ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the year, 2012, the assessee purchased a residential property on 12.04.2012 for consideration of ₹ 180 lakhs and calculated Nil capital gains. In respect of second property at Cuddalore were land and buildings used for commercial purpose for running cinema theatre was sold by three separate documents as Sl. No. Doc. No. Land Area sq.ft. /value Building Area sq.ft/ value Machinery value Total Value 1 3034/10 15990/1,23,47,775 1937.5/14,03,225 1,37,51,000 2 3033/10 17967/1,38,81,893 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on of year 1995-96 at ₹ 20,16,745/- . The assessee claimed exemption of ₹ 40,52,023/- u/s.54F of the Act in the income returned and because of change of indexation value, the deduction u/s.54F of the Act was recalculated. Due to change in base year, long term capital gains recalculated at 75,06,495/- and subjected to tax. Aggrieved by the order of the AO, the assessee filed an appeal before the Ld.CIT(A). 3.3. In appellate proceedings, the Authorised Representative of assessee appeared on the date of hearing, argued the case and filed written submissions and also explained the circumstances and calculations of long term capital gains, were the assessee had invested the long term capital gains in the residential house and clai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... omes the owner of the asset. The assessee has become the rightful owner on the demise of his father as a legal heir in 1995-96. Though the property was held by the father from the year1965-66, the provisions of the Act allow the assessee to claim indexation from the period 01.04.1981. Ld.CIT(A) considered the submissions and arguments advanced by the ld.A.R and perusing the findings of AO on a technical grounds, observed that the assessee s father had not inherited the property, but he has purchased in the year 1965-66, Therefore, the above provisions are not applicable and the distinguished the decision of the Bombay High Court and concurred with the findings of the AO and upheld the same. Aggrieved by the order of the CIT(A), the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ions, perused the material on record and judicial decision cited. The ld.A.R has emphasized on the disputed issue on holding period of the assessee on whom the assets are devolved on the death of assessee s father, the provisions of Sections 48 49(i) of the Act allow special mode of transfer in gift and succession. The action of the AO that the property was acquired by assessee s father and not inherited as per the provisions of the Act cannot be acted upon were assessee became a rightful owner as per Explanation 1(i)(b) to section 2(42A) of the Act and in the present case, assessee deemed to hold the property as on 1981 and indexed cost of acquisition has to be calculated from 01.04.1981 with the base year as 100. The assessee s father a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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