9911796707
TMI Blog2013 (6) TMI 925X X X X Extracts X X X X X X X X Extracts X X X X ..... ent agreement. Aggrieved, the assessee filed appeal before the CIT(A). For the A.Y. 2005-2006, the assessee in the first three grounds of appeal before the CIT(A) challenged the Assessing Officer s decision in holding that transfer of property chargeable to capital gains took place and the assessee entered into development agreement. The assessee submitted before the CIT(A) that construction work was in progress and the assessee s share of apartment has not been handed over to him during the A.Y. 2005- 06. It was, therefore, submitted that the date of development agreement could not be treated as the date of transfer. The CIT(A) held at para 6.4 of his order as follows : I have duly considered the facts on record, the assessment order and the submissions of the assessee. Actual payment of consideration is not a requirement for transfer to be completed under sec. 53A of the Transfer of Property Act; all that is required is that the property should have been contracted to be transferred for consideration, and the transferee (in this case, the developer) to be willing to perform his part of the contract (in this case, construction of and handing over of the assessee s share of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ure of plant that has been described in the schedule in detail. The CIT(A) observed that there is only a reference in the agreement to the existing residential house. The agreement specifies that sale proceeds of the dismantled material from the house are to be appropriated by the developer and not the assessee. Hence, he was of the opinion that it is only because the house is not part of the transferred asset that the assessee was required to serve his liability to incur cost of the demolition and his right over the sale proceeds of the dismantled material and in otherwords, the building is not part of the transferred scheduled property but is distinct from it. The CIT(A), therefore, held that the transferred asset merely consisted of land and not of residential house and consequently, the assessee is not entitled to deduction under section 54 of the transferred asset and has dismissed the assessee s grounds. 7. The learned Counsel objected to the Assessing Officer and CIT(A) in relying on the decision in the case of Dr. Maya Shenoy vide ITA.No.266/Hyd/2005 dated 24.10.2008. Without prejudice to ground No. 1 to 3, the assessee further raised ground No. 4, 5, 6 as below : 4 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent agreement contained a clause which clearly states that the building will be demolished by the developer at his own cost and that the developer would be entitled for the sale proceeds of the dismantled material. That being the case the order of the CIT(A) denying cost of construction of the existing building and indexation thereon is incorrect. The Learned Counsel for the assessee relies upon the order of this Hon ble Tribunal in the case of Prabhandam Prakash vs. ITO (ITA.No.147/H/2007) dated 25th January, 2008 and reported as (2008) 22 SOT 58 (Hyd.). In the said order similar issue was dealt and was allowed in favour of assessee. 11. In so far as the value of structure is concerned, the AO and CIT(A) have not given any deduction for the same. The Learned Counsel for the assessee submitted that as per the approved plan which is placed at page 49 of paper book before the Hon'ble Tribunal the plinth area of the constructed area is about 5000 sq. ft. This plan approval was obtained just before entering into development agreement which depicts the true picture with regard to the area of construction. So far as the value of the super structure of the building for a building a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e another angle. Section 54/54F uses the expression a residential house . The expression used is not a residential unit . This is a new concept introduced by the Assessing Officer into the section. Section 54/54F requires the assessee to acquire a residential house and so long as the assessee acquires a building, which may be constructed, for the sake of convenience, in such a manner as to consist of several units which can, if the need arises, be conveniently and independently used as an independent residence, the requirement of the Section should be taken to have been satisfied. There is nothing in these sections which require the residential house to be constructed in a particular manner. The only requirement is that it should be for the residential use and not for commercial use. If there is nothing in the section which requires that the residential house should be built in a particular manner, it seems to us that the income tax authorities cannot insist upon that requirement. A person may construct a house according to his plans and requirements. Most of the houses are constructed according to the needs and requirements and even compulsions. For instance, a person may cons ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
