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TMI Blog2020 (10) TMI 1043X X X X Extracts X X X X X X X X Extracts X X X X ..... ted for scrutiny assessment under CASS for the reason that there was cash deposit in co-operative bank and mismatch in income/capital gain on sale of land & building and interest income. In the course of scrutiny assessment proceedings, the AO confronted the assessee with the fact that there were cash deposits of Rs. 20,46,000 in the assessee's bank account with The Janatha Co-op. Bank. The assessee explained the source of deposit of cash in bank account as from and out of sale proceeds of a property during the previous year and the sum so received was deposited in the bank account. It was also explained that the capital gain on sale of property was not exigible to capital gains tax because the assessee invested the sale proceeds in con ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ncome under the head 'capital gain' was determined by the AO at Rs. 32,56,650 + 25,55,911. 4. Aggrieved, the assessee filed appeal before the CIT(Appeals). The assessee sought to file report of registered valuer to show the cost of construction of the capital asset. The assessee also sought to file evidence to show that within a period of 3 years from the date of transfer of capital asset, the assessee had put up construction of residential house and therefore the requirement of deposit of the unutilized capital gain in a specified bank account did not arise for consideration. In this regard, the assessee placed reliance on the decision of Hon'ble High Court of Karnataka in the case of Fathima Bai v. ITO [2010] 32 DTR 243 (Kar. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... IT(Appeals) also held that the sum of Rs. 46 lakhs which was the full value of consideration received on transfer should be taxed as income from other sources. This direction had some tax implication because the long term capital gain is taxed @ 20%; whereas the income under the head 'income from other sources' is taxed under the maximum marginal rate. Aggrieved by the order of CIT(A), the assessee has preferred the present appeal before the Tribunal. 7. There are basically three issues that need to be decided viz., - (i) What is the cost of construction of capital asset that was sold by the assessee? (ii) whether the assessee is entitled to deduction u/s. 54 of the Act on the basis of decision of the Hon'ble High Court of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eek to rely on or required by the AO to substantiate her claim. 10. As far as the third issue with regard to whether the sum of Rs. 46 lakhs should be part of long term capital gain or income from other sources, we find that the assessee in the proceedings before the AO has filed copy of agreement for sale dated 22-7-2013 in which the price agreed between the parties was a sum of Rs. 94 lakhs. In the light of this evidence, the question whether the sum of Rs. 46 lakhs should form part of long term capital gain or income from other sources also needs to be examined by the AO. Accordingly, we set aside the order of CIT(Appeals) on this issue also and direct the AO to admit the additional evidence filed by the assessee and decide the issue in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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