9911796707
TMI Blog1982 (7) TMI 39X X X X Extracts X X X X X X X X Extracts X X X X ..... the circumstances of the case, the Tribunal was right in holding that the capital gains are chargeable to tax in the year of transfer of capital asset, even though the initial compensation is determined and becomes payable in subsequent years ? (3) Whether, on the facts and in the circumstances of the case, the Tribunal was right in holding that the capital gains are chargeable to tax in the year of transfer, even though no gains could be computed under section 48 during that year ? (4) Whether, on the facts and in the circumstances of the case, the Tribunal was right in extending the analogy relating to the enhanced compensation under specific provision of law, to the year of transfer, to case of initial compensation without there bein ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed the amount of capital gains on the compensation amount of Rs. 1,61,840 by deducting therefrom the value of the land as on. January 1, 1954, and further deductions admissible under s. 80T of the Act. Thus, the income chargeable under the head " Capital gains " was determined at Rs. 77,072. The assessee preferred an appeal. The AAC held that since the amount of compensation was determined during the financial year 1975-76, the capital gains could be deemed to have accrued to the assessee only during that year and not during the assessment year 1974-75 when the land in question was acquired by the Improvement Trust. Aggrieved by the order passed by the AAC, the Department preferred an appeal before the Tribunal. The Tribunal took the view t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and 54E of the Act, which entitled the assessee to the grant of reliefs under their provisions. It was, therefore, contended that capital gains should be held to be chargeable to income-tax during the year of the " effective transfer " when the consideration for transfer accrued to or was received by the assessee. To appreciate the contentions urged on behalf of the assessee, it would be necessary to refer to the relevant provisions of law. Section 45 of the Act makes profits or gains arising from the transfer of a capital asset, effected in the previous year, chargeable to income-tax. Section 45 of the Act further provides that those profits or gains shall be deemed to be the income of the previous year in which the transfer took place. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r was received or accrued is not relevant for the purpose of determining the year of chargeability on account of the fiction introduced by s. 45 of the Act. Whatever may be the date of receipt or accrual of consideration as a result of the transfer of a capital asset, the accrual or receipt of consideration would have to be attributed, by statutory mandate, to the year of transfer. Hence, an enquiry into the question as to when the right to receive the compensation amount accrues to a person, in the case of compulsory acquisition of his property under the provisions of the M.P. Town Improvement Trust Act, 1961, though interesting, would not be relevant for the purpose of determining the year of chargeability of the capital gains because the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d by s. 54B and s. 54E of the Act, as that question would be examined by the authorities concerned as and when it arises. Moreover, the question as to whether reliefs should be provided to assessees to relieve the hardship, by making suitable legislative provisions, is a matter for the Legislature to consider. But the absence of provisions, which would have entitled an assessee to claim relief, cannot have the effect of rendering the provision regarding computation for quantifying the income chargeable under the head " Capital gains " unworkable. In the instant case, these provisions cannot be held to be non-applicable as in the case of goodwill of a new business. The decision in CIT v. B. C. Srinivasa Setty [1981] 128 ITR 294 (SC) is, ther ..... X X X X Extracts X X X X X X X X Extracts X X X X
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