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TMI Blog2016 (10) TMI 1317X X X X Extracts X X X X X X X X Extracts X X X X ..... ot find any infirmity in the order of Ld.CIT(A). The same is confirmed. Denial of loan liability from the cost of acquisition as deduction in the computation of long term capital gains - AO has denied the claim of deduction as impugned capital asset was settled by the grandmother of the assessee in his favour vide Settlement Deed wherein no narration of the pre-existing change/mortage in the capital asset and loan liability was related to a partnership firm M/s.S.Albert Co., taken for the business purposes of the aforesaid firm - HELD THAT:- Property was given as a collateral security for the loan availed by other than the assessee, which is a M/s.S.Albert Co., as pointed out by the AO in his assessment order and neither the assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... AO made a reference to the Sub-Registrar at Melur, Tuticorin. As per the information received from the sub registrar vide his letter dated 22.2.2013, the value of the property as on 01.04.1981 was ₹ 3,000/- per cent. The AO in view of the information received, substituted the FMV as on 01.04.1981 filed by the assessee at ₹ 6,000/- per acre, to ₹ 3,000/- per acre. Aggrieved with the order of AO, the assessee carried the appeal before the Ld.CIT(A). On appeal, the Ld.CIT(A) observed that while the assessee has the support of the Chartered Engineer s Valuation Report, the AO has placed reliance on the FMV as ascertained from the Sub-Registrar. Both the valuations are based on a definite footing and as such placing reliance o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Smt.Susila Ammal) of the assessee in his favour vide Settlement Deed dated 14.07.2004. In the Settlement Deed there was no narration of the pre-existing change/mortage in the capital asset. b) The loan liability was related to a partnership firm M/s.S.Albert Co., taken for the business purposes of the aforesaid firm. The assessee s grandmother Smt.Susila Ammal was one of the partner s of the firm. This partnership firm was later on incorporated into M/s.S.Albert Co. Pvt Ltd., in the year 1998. The company took over the partnership firm-lock, stock and barrel. Hence, AO was of the opinion that the loan liability was relatable to the partnership firm/company and not to the assessee. c) The sale consideration has not been paid by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt for liquidation loan was made in April, 2007, and the last on February 2010. (4) The appellant has failed to controvert the finding in the assessment order that the sales consideration was not utilized to clear the loan liability. (5) In any case, appellant s grandmother was just a guarantor. The primary responsibility for the loan stands on the borrower, i.e. the Company that had taken over the firm. The charge of the bank was on the company, and not appellant s grandmother. The company was able to discharge the loan through negotiation and structuring without alienating the impugned property which was a collateral. Once the loan was restructured as per. the Memo of compromise, the same was honored by the company as per the schedu ..... X X X X Extracts X X X X X X X X Extracts X X X X
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