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TMI Blog2016 (2) TMI 1074X X X X Extracts X X X X X X X X Extracts X X X X ..... compliance with the conditions prescribed in Section 54F of the Act. In view of the above, we are unable to uphold the order of the lower authority. Therefore, the orders of the lower authorities are set aside. The Assessing Officer is directed to treat the profit on sale of the land as long term capital gain and examine whether the assessee has complied with the conditions prescribed in Section 54F of the Act. If the assessee has complied with the conditions prescribed in Section 54F of the Act, then the assessee is eligible for deduction under Section 54F of the Act. - Decided in favour of assessee. - ITA No.993/Mds/2015 - - - Dated:- 19-2-2016 - SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng to the Ld. counsel, a property can be acquired only once irrespective of the character at the point of acquisition. Placing reliance on the decision of the Pune Bench of this Tribunal in Kalyani Exports Investment (P.) Ltd. v. DCIT (2001) 78 ITD 95 (TM), the Ld.counsel submitted that whether the property in question becomes capital asset by the act of the assessee or amendment to the law is irrelevant. According to the Ld. counsel, there can be one date of acquisition. This decision of the Pune Bench of this Tribunal was followed by this Bench of the Tribunal in ACIT v. Integrated Enterprises Ltd. in I.T.A. Nos.1837 1841/Mds/2011 dated 09.12.2015. Therefore, according to the Ld. counsel, the original date of acquisition of the proper ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... term capital gain. Accordingly, he rejected the claim of the assessee for deduction under Section 54F of the Act. 4. We have considered the rival submissions on either side and perused the relevant material available on record. short-term capital asset is defined in Section 2(42A) of the Act as follows:- short-term capital asset means a capital asset held by an assessee for not more than thirty-six months immediately preceding the date of its transfer. The assessee acquired the land at VGP Golden Beach Layout on 20.12.2006 for a total consideration of ₹ 41,25,160/-. Initially the property was sold as stock-in-trade and the same was subsequently converted into capital asset during the year 2009. The assessee sold the pro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the affirmative. The matter appears to me to be concluded by the judgment of the Hon'ble Bombay High Court in Keshavji Karsondas'; case (supra). It was held therein that an asset cannot be acquired first as a non-capital asset at one point of time and again as a capital asset at a different point of time. There can be only one acquisition of an asset and that when the assessee acquires it for the first time, irrespective of its character at that point of time. It was therefore, held that what is relevant for the purpose of capital gains is the cost of acquisition and not the date at which the asset became a capital asset. The decision of the Gujarat High Court in Ranchhodbhai Bhaijibhai Patel';s case (supra) was followed by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... able to appreciate the distinction sought to be made by the ld. Sr. DR on the ground that the decision cannot be applied to a case where the asset has become a capital asset by the act of assessee (say, by conversion, as in the present case) and it must be confined to a case where the asset has become a capital asset by legislative intervention. The true ratio of the decision is that there is only one point of acquisition of an asset and the cost on that date has to be reckoned, irrespective of the character of the asset at that point of time, be it capital asset within the meaning of section 2(14) or not. If that is the true ratio and I firmly believe it is then the question whether it became a capital asset by the act of the assessee or b ..... X X X X Extracts X X X X X X X X Extracts X X X X
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