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TMI Blog2019 (12) TMI 364X X X X Extracts X X X X X X X X Extracts X X X X ..... ils of any such improvement in the capital asset. No material much less a cogent evidence has come from assessee s side except oral submissions. We accept the Revenue s arguments in this peculiar factual backdrop and affirm the CIT(A) s detailed discussion that the Assessing Officer had rightly made the impugned long term capital gains addition after distinguishing the assessee s case law quoted in the lower appellate proceedings (supra). We see no illegality or irregularity in the CIT(A) s action distinguishing the same on facts. The assessee fails in her sole substantive grievance. - Decided against assessee. - ITA No.115/Kol/2018 - - - Dated:- 27-11-2019 - Shri P.M.Jagtap, Vice-President And Shri S.S.Godara, Judicial Member ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se. Further, it is submitted that the condition of the land, over a long period of time, has improved by various external factors after acquisition. Therefore, capital gain tax is not chargeable in this case. It is further contended that as land has improved due to external factors, the cost of improvement cannot be ascertained and hence capital gain tax should not be levied. The other argument given is that the land was an agricultural land even at the time of transfer. Mere extension of Municipal limit does not change the character of the land and hence it should not be charged to tax. The basic facts of the case are that the assessee is the co-owner of land, the specification of which are as under:- CS Dag No.554 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al area of Rajarhat Gopalpur Municipality and can be categorized as urban land as on the date of sale. Urban land falling within the municipal limit of Rajarhat Gopalpur Municipality would definitely be subject to capital gains tax. As regards cost of improvement it has been admitted that no direct expenditure has been incurred by the appellant for improvement of the land. Therefore, the AO has rightly granted indexation on the cost of purchase of land for the purposes of computing capital gains. The only contention of the appellant is that the value of land has appreciated because of the improvement of the external environment of the land and hence not chargeable to Capital Gains tax. In this regard, my observation is that the appreciation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... provisions for computation of capital gains tax would fail and therefore the charging section would also fail. In this regard, the appellant has relied on various case laws. It is pertinent to point out that the cost of improvement has been defined in the Act, w.e.f 01.04.1988, u/s.55(1)(b) which reads as follows:- (b) 'cost of improvement - (1) In relation to a capital asset being goodwill of a business [or a right to manufacture, produce or process any article or thing][or right to carry on any business} shall be taken to be nil; and (2) in relation to any other capital asset, -] i) where the capital asset became the property of the previous owner or the assessee before the [1st day of April.[1981] mea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ned by the AO. Hence, the charging provision does not fall in this case and capital gains has been correctly computed . Case Laws quoted by the assessee: a) B.C. Srinivasa Setty ([1981] 128 ITR 294 (SC) This case law is regarding capital gain on transfer of goodwill of a firm and pertaining to A. Y r.1966-67. As the law stood then, goodwill- was a self acquired asset whose cost of acquisition could not be determined and consequently not chargeable to Capital Gains tax. However, amendment has been brought to the Act w.e.f 01.04.l988 and the definition of cost of improvement and cost of acquisition has been inserted in the Act. Therefore, this case law does not hold good any more. b) Jaswantlal Dayabhai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... improvement of the land. In view of the above, I do not see any error in the calculation of capital gains made by the AO. Accordingly, the appeal of the assessee on this issue is hereby dismissed . 3. Learned authorized representative vehemently contends during the course of hearing that both the lower authorities ought to have considered the fact that the assessee had admittedly purchased the impugned capital assets as agricultural land way back in the year 1994 going by the purchased deed dated 17.02.1994 forming part of case records in pages 16 to 21. That the land falls within the specified distance of the nearest municipal limits as prescribed in sec. 2(14 (iii)(b) of the Act is also not an issue. His only case ..... X X X X Extracts X X X X X X X X Extracts X X X X
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