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TMI Blog2018 (10) TMI 370X X X X Extracts X X X X X X X X Extracts X X X X ..... since the building had no value and therefore, got demolished - Decided in favour of assessee Loss of sale of shares - AO found that the assessee had not filed proper details- Held that:- in the absence of any evidence produced by the assessee to indicate that there were, indeed, transactions of purchase and sales of shares by the assessee, the Assessing Officer rejected the contention of the assessee and held that the purported loss of sale of shares is a speculation loss and cannot be set off against other gains except gains, if any, on any other speculation business as envisaged under Sub-Section (1) of Section 73 of the Act. Thus, we find that the reasons assigned by the Assessing Officer as confirmed by the CIT (A) as well as the Tribunal are perfectly legal, valid and do not call for any interference. Accordingly, substantial question of law No.2 is answered in favour of the Revenue and against the assessee. - Tax Case Appeal No.143 of 2009 - - - Dated:- 18-9-2018 - Mr. T. S. Sivagnanam And Mrs. V. Bhavani Subbaroyan JJ. For the Appellant : Mr.A.S.Sriraman For the Respondent : Mr.M.Swaminathan JUDGMENT T. S. SIVAGNANAM, J. The Revenue has prefe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Assessing Officer, pointing out the above facts and objecting to the proposal to invoke Section 50 of the said Act. 5. The Assessing Officer did not agree with the contentions advanced by the assessee, but held that the assessee failed to furnish any concrete proof to show that only the building has been subjected to depreciation all along, that the land was not a part of the schedule for fixed asset at any point of time and that the land was shown separately elsewhere in the balance sheet under asset projections. The Assessing Officer further held that the assessee had not given any satisfactory reply supported by documentary evidence and that the provisions of Section 50 of the Act are squarely applicable to the assessee's case. Further, the Assessing Officer, while computing the short term capital gains in terms of Section 50 of the Act, had adopted the sale consideration at ₹ 3,84,35,774/- as against the contracted value of ₹ 2.07 Crores adopted in their computation. 6. With regard to the claim of long term capital loss on the sale of shares, the assessee contended that the shares were bought through M/s. Aditya Securities Limited while entering into a co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ital gains arise on sale of the land. The assessee further contended that in the depreciation schedule, nowhere a land is shown as asset eligible for depreciation and that there is no rate prescribed for allowing depreciation on land. 12. Therefore, the Assessing Officer is not correct in stating that the land sold is a short capital asset, on which, depreciation had been claimed. 13. Further, referring to the development agreement, it was contended that the agreement clearly stated that the land alone had been the subject of development and that the building in the land had been demolished. 14. The Assessing Officer was of the view that the assessee did not produce sufficient records to establish their contention that no depreciation was claimed on the land, but concluded that in the absence of any satisfactory reply supported by documents, the provisions of Section 50 of the Act squarely became applicable to the assessee's case. The said finding was confirmed by the CIT (A) as well as the Tribunal. 15. An identical issue came up for consideration before the Division Bench of this Court in the case of CIT Vs. Union Co. (Motors) Ltd. [reported in (2006) 283 ITR 04 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of depreciable assets. Once the land forms part of the assets of the undertaking and the transfer is of the entire undertaking as a whole, it is not possible to bifurcate the sale consideration to a particular asset. As already observed above, Section 50 of the Act applies only when depreciable assets alone are transferred. 6. It is, therefore, a settled law that even though the transaction involved land and building, once the land forms the assets of the undertaking, the transfer is of entire undertaking as a whole and it is not possible to bifurcate the same, as suggested by the assessing officer in the instant case. All the more, in the instant case, the fact remains that the purchaser had applied for demolition of the building and also demolished the building, which was taken into consideration by the Commissioner and the Tribunal, while arriving at a conclusion that Section 50 of the Act is not attracted, as, under the facts and circumstances of the case, it is clear that the sale consideration made by the purchaser is only for the land, since the building had no value and therefore, got demolished. 17. In our considered view, the above decision is a straight answer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Further, the Assessing Officer found that the depository participatory client name was furnished as Ritu Kumar, who was not the assessee. Based on the said information, the Assessing Officer took the view that the shares have not been transferred and accordingly, treated the transaction as speculative. This finding was confirmed by the CIT(A) and while doing so, he took note of Securities and Exchange Board of India Regulations, 1993 and held that the assessee had not claimed short term capital loss on the sale of shares without proving that the shares were purchased in the name of the assessee and sold by the Fund Manager on behalf of the assessee. The transactions having been found to be not verifiable, the CIT (A) concurred with the view taken by the Assessing Officer. This finding was affirmed by the Tribunal. When the assessee has not been able to prove as to why the transaction in shares should not be treated as speculative transaction, we find no reason to interfere with the concurrent finding of facts recorded by the Assessing Officer as confirmed by the CIT (A) as well as the Tribunal. 24. In the assessment order, the Assessing Officer has taken note of the decision o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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