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TMI Blog2013 (6) TMI 824X X X X Extracts X X X X X X X X Extracts X X X X ..... were filed by assessee. In the said returns, long term capital gain arising from sale of shares held by the assessees in a company namely M/s. Kamala Mension Pvt. Ltd. was shown by the assessees. The entire share capital of the said company was held by the assessees as well as other persons belonging to the same family/group and the same was transferred/sold to Rekha Gunwant Ashok Shah and M/s. Suraj Ltd. by the agreement dated 14.11.2006 at the rate of ₹ 9,093/- per share. On perusal of the said agreement as well as relevant balance-sheet and Profit Loss Account of M/s. Kamala Mension Pvt. Ltd., the AO found that said company was not engaged in any sort of business activity and it was merely deriving income in the form of rent from two flats nos. 1901B and 2001B in the building of Om Vikas Apartments at Walkeshwar Road, Mumbai owned by it together with garage numbers 28 29. According to him, the agreement entered into by the assessees in the garb of share transfer agreement thus was de facto the agreement for transfer of property being flat numbers 1901B and 2001B in Om Vikas Apartments and the real intent to transfer the entire shares in M/s. Kamala Mension Pvt. Ltd. wa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e any business Relationship with the Directors/shareholders or any associates thereof. On the facts and circumstances of the case and in law the ld. CIT(A) erred in confirming addition of ₹ 55,28,500/- to the sale consideration being separate payment to the company for repayment of loan taken by the company for purchase of property. Without prejudice on the facts and circumstances of the case and in law the Ld. CIT(A) erred in not considering the ground of the appellant to substitute indexed cost of the value of the immovable property while computing capital gains on sale of immovable property. 5. We have heard the arguments of both sides and also perused the relevant material on record. As submitted by the Ld. Counsel for assessee, similar additions made on account long term capital gain by enhancing the value of sale consideration in the cases of other assessee belonging to the same family/group viz. Shri Irfan Abdul Kader Fazlani , Shri Iqbal Abdul Kader Fazlani and Shri Imran Yunus Fazlani , who had also sold the shares held by them in M/s. Kamala Mension Pvt. Ltd., were disputed in the appeals filed before the Tribunal taking identical grounds and the Tribun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the provisions of section 50C are deemed provisions and, therefore, the same have to be interpreted strictly in accordance with the spirit of the provisions. In the light of the above legal interpretation of section 50C of the Act, we need to examine the facts of the present case. In the instant case, what transferred by the assessee are the shares in the company and not the land or building or both. Assessee does not have full ownership on the flats which are owned by the company. The transfer of shares was never a part of the assessment of the Stamp duty Authorities of the State Government. The company was deriving income, taxable under the head income from property for more than a decade. The expression assessable is inserted in section 50C (1) of the Act is not relevant for the impugned assessment years. In such circumstances, the AO s decision to invoke the provisions of section 50C to the tax planning adopted by the assessee is not proper and it does not have the sanction of the provisions of IT Act. The provisions of section 50C are deemed provisions which are required to be strictly interpreted, it is not covered by the expressions of the present case. Therefore, we ar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and in determining the sale value at ₹ 3,02,68,784/- against agreement value of ₹ 1,47,00,000/- while working out the capital gain on sale of shares of BLUE DIAMOND REALATORS P.LTD 2. The purchasers of the shares of the company are not relatives of the Directors! Shareholders of the company nor they have any business Relationship with the Directors/Shareholders or any associates thereof. On the facts and circumstances of the case and in law the Learned CIT (A) erred in confirming addition of ₹ 94,08,637/- to the sale consideration being separate payment to the company for repayment of loan taken by the company for purchase of the property. 3. On the facts and circumstances of the case and in law the learned CIT (A) erred in computing short term capital gains on sale of shares of BLUE DIAMOND REALATORS P. LTD against long term capital gains by the appellant and assessed by learned Assessing Officer on the ground that depreciation is being claimed on the building as per Profit Loss account and Balance sheet of BLUE DIAMOND REALATORS P LTD which also is an error the appellant has not claimed any depreciation in the return of Income. 4. Without pr ..... X X X X Extracts X X X X X X X X Extracts X X X X
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