2005 (9) TMI 69

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..... tified in treating the surplus consideration as long-term capital gains. The Tribunal was therefore justified in holding that the capital gains so arising were long-term capital gains and the assessee was entitled to deduction from such gains as per law.
Judge(s) : D. A. MEHTA., MS. H. N. DEVANI. JUDGMENT The judgment of the court was delivered by D.A. Mehta J.- The following question has been referred by the Income-tax Appellate Tribunal, Ahmedabad Bench "A", under section 256(1) of the Income-tax Act, 1961 ("the Act"), at the instance of the Commissioner of Income-tax, Baroda. "Whether, on the facts and in the circumstances of the case, the Appellate Tribunal was right in law in holding that the capital gains arising out of the sa .....

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..... ) who upheld the assessment on this count. When the matter went before the Tribunal in second appeal it was held by the Tribunal vide order dated March 19,1993, that the assessee acquired the capital asset at the time when allotment was made and the price was agreed upon between the parties. The payment of price subsequently by way of instalments was in relation to the capital asset already acquired for the price already agreed upon. That a capital asset would consist of bundle of rights and hence according to the Tribunal the assessee was rightly liable to tax on the surplus under the head long-term capital gains. Mr. M.R. Bhatt, learned standing counsel appearing on behalf of applicant-Revenue has very fairly invited attention to the de .....

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..... the Act. In almost similar situation the court was called upon to decide whether the assessee had held the capital asset for a period of more than 36 months. Therein the assessee was allotted a flat by a cooperative housing society by way of allotment of shares on November 15, 1979. The possession of the flat was delivered in October, 1981. The shares were transferred on December 4, 1982. It was in this context that the controversy was brought before this court wherein the Revenue had raised identical contentions about the capital asset having been held for a period of less than 36 months. The said submission was not accepted by this court in the light of the ratio reproduced hereinbefore. Applying the ratio of the aforesaid decision to th .....

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