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TMI Blog2022 (11) TMI 621X X X X Extracts X X X X X X X X Extracts X X X X ..... ered, the actual outflow from the hands of the assessee towards acquisition of the property cannot be ignored for computing the capital gains.Assessee has claimed several items towards cost of improvement for which bills and invoices were submitted before the AO. The breakup of the amount considered by the AO as of acquisition i.e.Rs.40,94,980 is not available on record and the reference given in the assessment order as does not provide any clarity on how this amount is arrived at. In view of this discussion we remit the issue back to the AO for arriving at the cost of acquisition with proper breakup. AO while doing so is directed to consider the actual amount paid by the assessee as per the Assignment Agreement including amounts paid to L T and stamp duty based on evidences / supporting documents submitted in this regard. AO is also directed to verify the bills and documents with regard to cost incurred towards brokerage, interiors, painting etc., and consider these amounts for the purpose of arriving at the capital gains in accordance with law. Needless to say that the assessee may be given an opportunity of being heard. Appeal is allowed for statistical purposes. X X X X Extracts X X X X X X X X Extracts X X X X ..... ision shall be applicable". This would mean that all pending assessments for which orders are passed after 1.4.2020, would get covered by the amended section of 144C whereby the non-residents would be eligible assessees for taking up the DRP route. In assessee's case, the AO has issued the draft assessment order on 27.9.2021 and accordingly the amended provisions of section 144C would become applicable. In view of this, the additional ground raised by the assessee is dismissed. 7. We will now consider the issue on merits. During the year under consideration, the assessee sold a property for a consideration of Rs.1,55,00,000. In the statement of income the assessee computed the capital gain as under:- Sale Consideration Rs. 1,55,00,000/- Less: brokerage/Selling expenses Rs. 1,55,000/- Net Sale Consideration Rs. 1,53,45,000/- Less: Indexed Cost of acquisition (Rs.70,00,000 * 280/129) Rs. 1,51,93,798/- Long Term Capital Gains Rs. 1,51,202/- 8. The breakup of the cost of acquisition as submitted by the assessee before the AO is extracted below :- 1 Amount paid towards purchase cost 49,44,000/- (As per Assignment agreement) Total of Rs 49,44,000/- 49,44,000/- Copy of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... paid by the assessee for acquisition of the property and hence the same was claimed as cost of acquisition for the purpose of capital gains. The assessee also submitted supporting documents / bills pertaining to the interior works, paintings, etc. which were claimed as part of cost of acquisition before the AO. 10. The AO did not accept the submissions of the assessee by quoting the following reasons:- (1) The agreement of assignment has not been registered as evidently both parties believe that there is no transfer of any right, title or interest which will attract the provisions of Transfer of Property Act or that of the Indian Registration Act, 1908. (2) The property was registered for the value of Rs.36,05,000 only and not for Rs.49,44,000. 11. The AO proceeded to consider a sum of Rs.49,08,340 as the cost of acquisition (registered value of the property and cost of improvement) and arrived at the capital gain which resulted in an addition of Rs.52,89,346. Aggrieved, the assessee filed its objections before the DRP. 12. The DRP confirmed the addition by stating that :- "a) The plea of assessee that Assessing Officer has wrongly considered the returned income as Rs.73, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ,469. Aggrieved, the assessee is in appeal before the Tribunal. 14. The ld. AR submitted that the actual amount of consideration paid by the assessee to the agreement holders is a sum of Rs.49,44,000 and the reason quoted by the AO for not considering the agreement of assignment is that the agreement is not registered. The ld. AR also submitted that the payment by the assessee to the agreement holders is done through proper banking channels and in this regard, drew our attention to the agreement of assignment at page 74 of PB. The ld. AR also drew our attention to the fact that the AO has not disputed the payment made by the assessee to the agreement holders and has acknowledged the same in the order of assessment. The ld. AR also submitted that since the original purchase cost agreed between L&T and the agreement holders was Rs.36,05,000, the Sale Deed was executed for the said amount. The ld. AR argued that merely for the reason that the assignment agreement is not registered, the actual cost of acquisition paid by the assessee cannot be denied. With regard to other cost of improvements, the ld. AR submitted that the relevant details have been furnished along with bills and invo ..... X X X X Extracts X X X X X X X X Extracts X X X X
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