THE DY. COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE-6(4), MUMBAI vs. SHRI NARENDRA GEHLAUT, MUMBAI

This appeal by the Revenue is directed against order dated 24.02.2022 passed by the Ld. Commissioner of Income-tax (Appeals)-54, Mumbai [in short ‘the Ld. CIT(A)’] for assessment year 2017-18, raising following grounds:

1. "On the facts and in the circumstances of the case, the learned CIT(A) has erred in holding that flat No C-3501 was allotted to the assessee on 23.04.2013 and not on 31.10.2015, as no verifiable evidence has been submitted by the assessee in support of his claim that Shri Narendra Gehlaut ITA No. 1101/Mum/2022

the the flat flat No No C-3501 C 3501 was was allotted allotted to to him him on on 23.04.2013?" 23.04.2013?" 2. "On the facts and in the circumstances of the case, "On the facts and in the circumstances of the case, "On the facts and in the circumstances of the case, whether the learned CIT(A) was justified in holding whether the learned CIT(A) was justified in holding whether the learned CIT(A) was justified in holding that flat No C that flat No C-3501 was allotted to the assessee on 501 was allotted to the assessee on 23.04.2013, thereby 23.04.2013, thereby allowing the claim of the 23.04.2013, thereby allowing the claim of the allowing the claim of the assessee, without considering the fact that the loan assessee, without considering the fact that the loan assessee, without considering the fact that the loan sanction letter dated 31.03.2015 mentions that the sanction letter dated 31.03.2015 mentions that the sanction letter dated 31.03.2015 mentions that the "disbursal amount" of Rs 13,45,88,871/ "disbursal amount" of Rs 13,45,88,871/- - is for the property i.e. C property i.e. C-2901 and not Flat No C-3501 for which 3501 for which the assessee has claimed benefit of interest paid of Rs the assessee has claimed benefit of interest paid of Rs the assessee has claimed benefit of interest paid of Rs 3,19,28, 276/ 3,19,28, 276/- to the lender, in the computation of to the lender, in the computation of capital gain? " capital gain? " 3. "On the facts and in the circumstances of the case, "On the facts and in the circumstances of the case, "On the facts and in the circumstances of the case, whether the learned CIT(A) was justified in holding whether the learned CIT(A) was justified in h whether the learned CIT(A) was justified in h that flat No C that flat No C-3501 was allotted to the assessee on 3501 was allotted to the assessee on 23.04.2013 thereby allowing the claim of the assessee 23.04.2013 thereby allowing the claim of the assessee 23.04.2013 thereby allowing the claim of the assessee without considering the fact that in the absence of any without considering the fact that in the absence of any without considering the fact that in the absence of any verifiable verifiable verifiable details details details that that that the the the amount amount amount of of of Rs. Rs. Rs. 11,33,10,868/ 11,33,10,868/- was paid for Flat No. 3501, fr was paid for Flat No. 3501, from F.Yr. 2013-14 to F.Yr. 2016 14 to F.Yr. 2016-17, the same cannot be 17, the same cannot be considered as correct and therefore, no cost of considered as correct and therefore, no cost of considered as correct and therefore, no cost of acquisition can be allowed to the assessee in respect acquisition can be allowed to the assessee in respect acquisition can be allowed to the assessee in respect of sale of Flat No. C of sale of Flat No. C-3501?" 4. "On the facts and in the circumstances of the case, "On the facts and in the circumstances of the case, "On the facts and in the circumstances of the case, whether the learned whether the learned CIT(A) was justified in deleting CIT(A) was justified in deleting the addition of Rs 11,53,38,145/ the addition of Rs 11,53,38,145/- on account of on account of unexplained investment w/s 69B of the Act by unexplained investment w/s 69B of the Act by unexplained investment w/s 69B of the Act by observing that Rs 22.86 crores as mentioned in MOU observing that Rs 22.86 crores as mentioned in MOU observing that Rs 22.86 crores as mentioned in MOU dated 14.12.2016 is nothing but the consolidated dated 14.12.2016 is nothing but the consolidated dated 14.12.2016 is nothing but the consolidated payment received from assesse payment received from assessee as well as the lender e as well as the lender of the assessee, without considering the fact that the of the assessee, without considering the fact that the of the assessee, without considering the fact that the loan sanction letter dated 31.03.2015 mentions that loan sanction letter dated 31.03.2015 mentions that loan sanction letter dated 31.03.2015 mentions that the "disbursal amount" of Rs 13.45.88,871/- is for the the "disbursal amount" of Rs 13.45.88,871/ the "disbursal amount" of Rs 13.45.88,871/ property i.e. C property i.e. C-2901 and not Flat No C-3501?" 3501?" 5. "On the facts and in the "On the facts and in the circumstances of the case, circumstances of the case, whether the learned CIT(A) was justified in deleting whether the learned CIT(A) was justified in deleting whether the learned CIT(A) was justified in deleting the addition of Rs 13,88,737/ the addition of Rs 13,88,737/- u/s 56(2)(vi) without u/s 56(2)(vi) without considering the fact that the assessee has not reported considering the fact that the assessee has not reported considering the fact that the assessee has not reported the same as liability?" the same as liability?" 6. "On the facts and in the circumstances of "On the facts and in the circumstances of the case, "On the facts and in the circumstances of whether the learned CIT(A) was justified in deleting whether the learned CIT(A) was justified in deleting whether the learned CIT(A) was justified in deleting the addition of Rs 2,78, 000/ the addition of Rs 2,78, 000/- on account of on account of Shri Narendra Gehlaut ITA No. 1101/Mum/2022 unexplained money w/s 69A of the Act, without unexplained money w/s 69A of the Act, without unexplained money w/s 69A of the Act, without considering the fact that during the assessment considering the fact that during the assessment considering the fact that during the assessment proceedings the assessee had not submitted any proceedings the assessee had not submitted any proceedings the assessee had not submitted any documen documentary evidences to establish the source of cash tary evidences to establish the source of cash found during the search at assessee's residential found during the search at assessee's residential found during the search at assessee's residential premises?" premises?"

Shri Narendra Gehlaut ITA No. 1101/Mum/2022 (a) The assessing Officer d The assessing Officer disallowed assessee’s claim of LTCG isallowed assessee’s claim of LTCG amounting to Rs. 8,96,59,373/ amounting to Rs. 8,96,59,373/- on transfer of rig on transfer of rights in flat and assessed the same e same as ‘ Short term capital gain ( Short term capital gain (STCG)’ of Rs. 13,99,61,282/-.

(b) The Assessing Officer declined claim of interest claim of interest of Rs. 3,19,28,276/- as cost of acquisition as cost of acquisition, which was paid on paid on housing loan borrowed for acquiring right acquiring right in the flat,.

© In respect of flat, the , the developer confirmed the payment received confirmed the payment received from the assessee of of Rs.22,86,49,013/- whereas the assessee whereas the assessee while computing the LTCG LTCG shown purchase cost cost incurred at Rs.11,33,10,868 /- only and therefore, the difference amount of and therefore, the difference amount of Rs.11,53,38,145/- was held by the Assessing Officer as not was held by the Assessing Officer as not was held by the Assessing Officer as not recorded in the books of accounts recorded in the books of accounts and assessed as and assessed as unexplained investment within the meaning of section 69B of the Act. investment within the meaning of section 69B of the Act. investment within the meaning of section 69B of the Act. assessee acquired (d) The Assessing Officer also obser The Assessing Officer also observed that the assessee acquired entire right in property property against part payment only and and neither paid the balance amount of Rs.13,88,737/ the balance amount of Rs.13,88,737/- for acquisition of the said for acquisition of the said rights and nor reported the same as liability in reported the same as liability in reported the same as liability in his books of accounts . This difference w his difference was held to be benefit as held to be benefit received by assessee and taxable as income falling under the provisions o and taxable as income falling under the provisions o and taxable as income falling under the provisions of section 56(2)(vii) of the Act section 56(2)(vii) of the Act.

(e) The Assessing Officer also held the cash found at the The Assessing Officer also held the cash found at the The Assessing Officer also held the cash found at the residence of residence of residence of the the the assessee assessee assessee amounting amounting to amounting to to Rs.2,78,000/- Rs.2,78,000/ Rs.2,78,000/ as Shri Narendra Gehlaut ITA No. 1101/Mum/2022 unexplained in absence of source n absence of source explained thereof along with thereof along with documentary evidence. documentary evidence.

2.1 On further appeal, the On further appeal, the ld CIT(A) allowed relief to the assessee ld CIT(A) allowed relief to the assessee deleting all addition/disallowance. deleting all addition/disallowance. Aggrieved, the Revenue is in , the Revenue is in appeal before the Tribunal raising the grounds as reproduced appeal before the Tribunal raising the grounds as r appeal before the Tribunal raising the grounds as r above.

4. The Ld. Counsel of the assessee filed a Paper Book containing The Ld. Counsel of the assessee filed a Paper Book containing The Ld. Counsel of the assessee filed a Paper Book containing pages 1 to 50 and also filed additional Paper Book containing pages pages 1 to 50 and also filed additional Paper Book containin pages 1 to 50 and also filed additional Paper Book containin 51 to 58.

5. The ground No. 1 and 2 of the appeal of the Revenue relates to The ground No. 1 and 2 of the appeal of the Revenue relates to The ground No. 1 and 2 of the appeal of the Revenue relates to the issue of capital gain on sale of flat No. C the issue of capital gain on sale of flat No. C-3501 in apartment 3501 in apartment namely ‘BLU Estate & Club BLU Estate & Club’, Worli, Mumbai. In these grounds n these grounds, the dispute is whether the capital gain on transfer of dispute is whether the capital gain on transfer of rights in rights in said flat is LTCG or STCG. T . The dispute is also regarding claim of interest he dispute is also regarding claim of interest paid on loan taken for investment paid on loan taken for investment in said flat as part of cost of said flat as part of cost of acquisition.

5.1 Brief facts qua the issue in dispute are that during the course Brief facts qua the issue in dispute are that during the course Brief facts qua the issue in dispute are that during the course of assessment, for evidence of sale of rights in flat, for evidence of sale of rights in flat, for evidence of sale of rights in flat, the assessee filed a copy of Memorandum of Understanding (MO Memorandum of Understanding (MO Memorandum of Understanding (MOU) dated 14/12/2016, which was executed , which was executed between assessee and buyers, between assessee and buyers, for Shri Narendra Gehlaut ITA No. 1101/Mum/2022 transfer of rights in said flat i.e. C said flat i.e. C-3501 (a copy of which is placed 3501 (a copy of which is placed on Paper Book pages 42 to 48 of the Paper Book). The Assessing on Paper Book pages 42 to 48 of the Paper Book). on Paper Book pages 42 to 48 of the Paper Book). Officer noted that as per as per MOU, the assessee vide application dated assessee vide application dated 23.04.2013 applied for a provisional reservation of residential flat 23.04.2013 applied for a provisional reservation of residen 23.04.2013 applied for a provisional reservation of residen No. C-3501 with the Developer with the Developer of BLU Estate & Club Estate & Club, Worli, Mumbai, i.e. Indiabulls Infra Estate Ltd. The MOU further mentions i.e. Indiabulls Infra Estate Ltd. The MOU further mentions i.e. Indiabulls Infra Estate Ltd. The MOU further mentions that the allotment was made against consideration value of that the allotment was made against consideration that the allotment was made against consideration Rs.23,05,37,750/-, which was , which was confirmed by the developer confirmed by the developer. The allotment of the flat was done by the developer on 31.10.2015 as allotment of the flat was done by the developer on allotment of the flat was done by the developer on recorded in the MOU dated 14.12.2016. The assessee stated to have U dated 14.12.2016. The assessee stated to have U dated 14.12.2016. The assessee stated to have paid an amount of Rs.22,80,40,013/ Rs.22,80,40,013/- to the developer to the developer towards the above reservation rights rights availed till 14.12.2016 (the date on which availed till 14.12.2016 (the date on which such rights have been transferred by the assessee). In the MoU such rights have been transferred by the assessee). In the MoU such rights have been transferred by the assessee). In the MoU dated dated 14.12.2016, 14.12.2016, the the assessee assessee claimed to have received consideration of Rs.14 crores consideration of Rs.14 crores from purchasers namely namely (1) Visaria Securities Pvt. Ltd. (2) Shri Securities Pvt. Ltd. (2) Shri Kamal Mavji Visaria and (3) Mavji Lalji Kamal Mavji Visaria and (3) Mavji Lalji Visaria. While computing the capital gain the assessee has shown hile computing the capital gain the assessee has shown hile computing the capital gain the assessee has shown cost of acquisition cost of acquisition at Rs.14,52,39,144/- which consists of which consists of Rs.11,33,10,868/- paid to the developer and Rs.3,19,28,276/ paid to the developer and Rs.3,19,28,276/- paid paid to the developer and Rs.3,19,28,276/ as interest to the bank as interest to the bank/financial institution for housing loan during housing loan during the F.Y. 2013-14 to F.Y. 2016 14 to F.Y. 2016-17. On further indexation 17. On further indexation, the indexed cost of acquisition was computed to Rs.16,36,12,777/ cost of acquisition was computed to Rs.16,36,12,777/ cost of acquisition was computed to Rs.16,36,12,777/-. Accordingly, the assessee after reducing the indexed cost of Accordingly, the assessee after reducing the indexed cost of Accordingly, the assessee after reducing the indexed cost of acquisition Rs.16,36,12,77 acquisition Rs.16,36,12,777/- out of deemed sale consideration i.e. out of deemed sale consideration i.e. market value of the rights transferred for stamp duty purpose at market value of the rights transferred for stamp duty purpose at market value of the rights transferred for stamp duty purpose at Shri Narendra Gehlaut ITA No. 1101/Mum/2022 Rs.25,32,72,150/-, computed long term capital pital gain gain of of Rs.8,96,59,373/-, as under: , as under:

Particulars Cost Indexed Cost 1. Amount paid in FY 2013 Amount paid in FY 2013-14 6,62,55,210 7,93,79,245 2. Amount paid in FY 2014 Amount paid in FY 2014-15 4,70,55,658 5,16,96,890 Paid to developer 11,33,10,868 13,10,76,135 4. Amount paid in FY 2015 Amount paid in FY 2015-16 ( 1,49,46,436 1,55,54,802 interest) 5. Amountpaid Amountpaid in in FY FY 2016- 2016 1,69,81,840 1,69,81,840 17(interest) Interest Cost 3,19,28,276 3,25,36,642 Total cost 14,52,39,144 16,36,12,777

Sale consideration 25,32,72,150 25,32,72,150 Less : indexed Cost of acquisition Less : indexed Cost of acquisition 16,36,12,777 16,36,12,777 Long term Capital Gain Long term Capital Gain 8,96,59,373 8,96,59,373 5,2 The assessee however has considered the allotment of the said he assessee however has considered the allotment of the said he assessee however has considered the allotment of the said flat C-3501 on 23.04.2013. Since, the flat has been transferred by 3501 on 23.04.2013. Since, the flat has been transferred by 3501 on 23.04.2013. Since, the flat has been transferred by the assessee on 14.12.2016, 14.12.2016, therefore, the assessee considered therefore, the assessee considered holding of the rights for more than the period of 36 months and holding of the rights for more than the period of 36 months and holding of the rights for more than the period of 36 months and treated the gain on transfer of said right as reated the gain on transfer of said right as LTCG LTCG, whereas the Assessing Officer has referred to the MO g Officer has referred to the MOU dated dated 14.12.2016, wherein it has been mentioned that the said flat No. C-3501 has wherein it has been mentioned that the said flat No. C wherein it has been mentioned that the said flat No. C been allotted to the assessee on 31.10.2015. According to the date been allotted to the assessee on 31.10.2015. According to the date been allotted to the assessee on 31.10.2015. According to the date of allotment noted in MOU, noted in MOU, the period of holding of the rights in the the period of holding of the rights in the said flat is less than 36 months said flat is less than 36 months i.e. from 31.10.2015 to 14.12.2016, i.e. from 31.10.2015 to 14.12.2016, therefore, the Assessing Officer rejected the contention of the therefore, the Assessing Officer rejected the contention of the therefore, the Assessing Officer rejected the contention of the assessee of the LTCG LTCG and held the gain on transfer of t and held the gain on transfer of the rights of Shri Narendra Gehlaut ITA No. 1101/Mum/2022 the flat as STCG. The Assessing Officer also rejected the claim of . The Assessing Officer also rejected the claim of . The Assessing Officer also rejected the claim of interest as part of cost of acquisition. Before the Assessing Officer in interest as part of cost of acquisition. Before the Assessing Officer in interest as part of cost of acquisition. Before the Assessing Officer in absence of any further clarification further clarification, he treated the gain as he treated the gain as STCG(short term capital gain short term capital gain) and also disallowed the claim interest allowed the claim interest of cost of acquisition acquisition. The STCG has been computed by the The STCG has been computed by the Assessing officer as under: Assessing officer as under:

Sale consideration 25,32,72,150 25,32,72,150 Less: Cost paid to Developer Less: Cost paid to Developer 11,33,10,868 11,33,10,868 STCG 13,99,61,282 13,99,61,282 5.3 On further appeal, the Ld. CIT(A) On further appeal, the Ld. CIT(A), after considering the after considering the remand report of the Assessing Officer on the additional evidences remand report of the Assessing Officer on the additional evidence remand report of the Assessing Officer on the additional evidence filed by the assessee filed by the assessee, deleted the additions made by the Assessing the additions made by the Assessing Officer observing as under: Officer observing as under:

“6.3.1 The facts of the case are that the appellant had 6.3.1 The facts of the case are that the appellant had 6.3.1 The facts of the case are that the appellant had booked flat No. C booked flat No. C-3501 at Indiabulls BLU, Worli, Mumbai 3501 at Indiabulls BLU, Worli, Mumbai from the developer, Indiabull Infraestate Ltd. vide from the developer, Indiabull Infraestate Ltd. vide from the developer, Indiabull Infraestate Ltd. vide application dated 23.04.2013. The consideration agreed application dated 23.04.2013. The consideration agreed application dated 23.04.2013. The consideration agreed for purchase of the flat was Rs.23,05, for purchase of the flat was Rs.23,05,37,750/- -. As per MOU dated 14.12.2016, the rights in Flat No C MOU dated 14.12.2016, the rights in Flat No C-3501 were 3501 were transferred transferred transferred for for for a a a lumpsum lumpsum lumpsum consideration consideration consideration of of of Rs. Rs. Rs. 14,00,00,000/ 14,00,00,000/- to purchasers i.e. (1) Visaria Securities Pvt. to purchasers i.e. (1) Visaria Securities Pvt. Ltd... (2) Shri Kamal Mavji Visaria and (3) Shri Mavji Lalji Ltd... (2) Shri Kamal Mavji Visaria and (3) Shri Mavji Lalji Ltd... (2) Shri Kamal Mavji Visaria and (3) Shri Mavji Lalji Visaria. In the MOU dated 14.12.2016, it was mentioned he MOU dated 14.12.2016, it was mentioned he MOU dated 14.12.2016, it was mentioned that that that till till till 14.12.2016, 14.12.2016, 14.12.2016, the the the appellant appellant appellant had had had paid paid paid Rs.22,86,49,013/ Rs.22,86,49,013/- to the developer and the balance to the developer and the balance amount of Rs.13,88.737/ amount of Rs.13,88.737/- remained payable to the remained payable to the developer. While calculating long term capital gain, the developer. While calculating long term capital gain, the developer. While calculating long term capital gain, the appellant appellant has ha s taken taken cost cost of of the the propertyat propertyat Rs. Rs. 11,33,10,868 (payment made to the developer). Further, 11,33,10,868 (payment made to the developer). Further, 11,33,10,868 (payment made to the developer). Further, an amount of Rs.3, 19,28,276/ an amount of Rs.3, 19,28,276/-was also taken as cost of was also taken as cost of acquisition as interest paid to bank on housing loan. Thus, acquisition as interest paid to bank on housing loan. Thus, acquisition as interest paid to bank on housing loan. Thus, the total cost of acquisition of the property was the total cost of acquisition of the property was the total cost of acquisition of the property was taken at Rs. 14,52,39,144/ Rs. 14,52,39,144/- and the indexed cost was worked out and the indexed cost was worked out

Shri Narendra Gehlaut ITA No. 1101/Mum/2022 at Rs. 16,36,12,777/ at Rs. 16,36,12,777/-. The market value of the property . The market value of the property was taken at Rs.23.48,98,517/ was taken at Rs.23.48,98,517/- and the long term capital and the long term capital gain was worked out at Rs.8,96,59,373/ gain was worked out at Rs.8,96,59,373/-. During the remand report proceedings, During the remand report proceedings, the AO has verified the AO has verified the allotment letter and the allotment letter and the sources of funds for purchase the sources of funds for purchase of property. After verification of the additional evidences of property. After verification of the additional evidences of property. After verification of the additional evidences submitted by the appellant, the AO has stated that the submitted by the appellant, the AO has stated that the submitted by the appellant, the AO has stated that the appellant appellant had had paid paid Rs.2,00,00,000/ Rs.2,00,00,000/-vide vide cheque cheque No.876744 dated No.876744 dated 22.04.2013. from the bank account with 22.04.2013. from the bank account with HDFC Bank Ltd for 'booking of Flat No.C HDFC Bank Ltd for 'booking of Flat No.C-3501. Tower C in 3501. Tower C in the project Indiabulls BLU, Worli, Mumbai. The allotment the project Indiabulls BLU, Worli, Mumbai. The allotment the project Indiabulls BLU, Worli, Mumbai. The allotment letter was issued by the developer, Indiabulls Infrastate letter was issued by the developer, Indiabulls Infrastate letter was issued by the developer, Indiabulls Infrastate Ltd. On 23.04.2013. Ltd. On 23.04.2013. Thus, the flat was booked by the d by the appellant on 23.04.2013 and the date of allotment was appellant on 23.04.2013 and the date of allotment was appellant on 23.04.2013 and the date of allotment was 23.04.2013. The AO has further stated that the assessee 23.04.2013. The AO has further stated that the assessee 23.04.2013. The AO has further stated that the assessee was eligible for long term capital gain in respect of the was eligible for long term capital gain in respect of the was eligible for long term capital gain in respect of the above mentioned property. above mentioned property. On perusal of the loan agreement and loan sanction le On perusal of the loan agreement and loan sanction le On perusal of the loan agreement and loan sanction letter dated 3103.2015 issued by India Bulls Commercial Credit dated 3103.2015 issued by India Bulls Commercial Credit dated 3103.2015 issued by India Bulls Commercial Credit Ltd., loan of Rs.25,88,87.000/ Ltd., loan of Rs.25,88,87.000/- was sanctioned @10.5% was sanctioned @10.5% p.a. On verification of the details submitted by the p.a. On verification of the details submitted by the p.a. On verification of the details submitted by the appellant, it is seen that the appe appellant, it is seen that the appellant had paid llant had paid Rs.2,00,00,000/ Rs.2,00,00,000/- on 23.04.2013, Rs.4,52,55,210/ 2,55,210/- on 23.10.2013 and Rs.4,70,16,940/ 23.10.2013 and Rs.4,70,16,940/- on 26.11.2014 on 26.11.2014 by cheque from HDFC Bank Ltd. Further, an amount of Rs. cheque from HDFC Bank Ltd. Further, an amount of Rs. cheque from HDFC Bank Ltd. Further, an amount of Rs. 13,45,88,871/ 13,45,88,871/- was disbursed by IICL Ltd on 31.03.2015 was disbursed by IICL Ltd on 31.03.2015 to the developer. Indiabulls Infrastate Ltd. Thus, the total to the developer. Indiabulls Infrastate Ltd. Thus, the total to the developer. Indiabulls Infrastate Ltd. Thus, the total payment of Rs.24,68,61,0 payment of Rs.24,68,61,021/- was made by the appellant was made by the appellant in respect of purchase of flat to the developer till 24. in respect of purchase of flat to the developer till 24. in respect of purchase of flat to the developer till 24. 12.2016. Thus, the appellant in fact has paid more 12.2016. Thus, the appellant in fact has paid more 12.2016. Thus, the appellant in fact has paid more amount than amount than the amount of Rs.22,86,49,013/ the amount of Rs.22,86,49,013/- as mentioned in the MOU dated 14. 12.2016. mentioned in the MOU dated 14. 12.2016. 6.3.2 From the above facts, it From the above facts, it is seen that Flat No. C is seen that Flat No. C-3501 was allotted to the appellant on 23.04.2013 and not on was allotted to the appellant on 23.04.2013 and not on was allotted to the appellant on 23.04.2013 and not on 31.10.2015. The appellant has paid total amount of 31.10.2015. The appellant has paid total amount of 31.10.2015. The appellant has paid total amount of Rs.24,68,61,021/ Rs.24,68,61,021/-, , Thus, Thus, the the appellant appellant has has rightly rightly computed long term capital gain in respect or sale of flat computed long term capital gain in respect or sale of flat computed long term capital gain in respect or sale of flat by taking the date of allotment on 23.04.2013. In view of the date of allotment on 23.04.2013. In view of the date of allotment on 23.04.2013. In view of the above facts, the addition of Short Term Capital Gain of the above facts, the addition of Short Term Capital Gain of the above facts, the addition of Short Term Capital Gain of Rs. 13,99,61,282/ Rs. 13,99,61,282/- made by the AO is deleted.”

Shri Narendra Gehlaut ITA No. 1101/Mum/2022 5.4 Before us, the Ld. DR referred to the MO s, the Ld. DR referred to the MOU dated 14.12.2016 U dated 14.12.2016 for transfer of rights to the buyer an for transfer of rights to the buyer and submitted that the flat in d submitted that the flat in question i.e. Flat No. C question i.e. Flat No. C-3501 was allotted to the assessee 3501 was allotted to the assessee on 31/10/2015 only. The Ld. DR also referred to the copy of the . The Ld. DR also referred to the copy of the . The Ld. DR also referred to the copy of the allotment letter dated 31.10.2015 issued by the developer i.e. M/s allotment letter dated 31.10.2015 issued by the developer i.e. M/s allotment letter dated 31.10.2015 issued by the developer i.e. M/s Indiabulls Infra Estate Ltd. which is Indiabulls Infra Estate Ltd. which is available on page 33 of the available on page 33 of the Paper Book. According to the Ld. DR in view of the documentary According to the Ld. DR in view of the documentary According to the Ld. DR in view of the documentary evidences, the period of holding of the rights in the flat being less the period of holding of the rights in the flat being less the period of holding of the rights in the flat being less than 36 months, the Assessing Officer has correctly assessed the the Assessing Officer has correctly assessed the the Assessing Officer has correctly assessed the gain as short term capital ga gain as short term capital gain. The Ld DR further referred to the The Ld DR further referred to the loan sanction letter dated 31/03/2015, available on paper book loan sanction letter dated 31/03/2015, available on paper book loan sanction letter dated 31/03/2015, available on paper book page 12-32 and submitted that said loan was sanctioned in respect 32 and submitted that said loan was sanctioned in respect 32 and submitted that said loan was sanctioned in respect of Flat No. C-2901 and not C 2901 and not C-3501, therefore, the interest cost is the interest cost is not in relation to flat C t C-3501.

5.5 The Ld. Counsel of the assessee on the other hand The Ld. Counsel of the assessee on the other hand The Ld. Counsel of the assessee on the other hand referred to the flat application form available o application form available on page 3 to 8 of the Paper Book n page 3 to 8 of the Paper Book and submitted that the assessee had applied for purchase of flat submitted that the assessee had applied for purchase of flat submitted that the assessee had applied for purchase of flat under consideration on 23.04.2013 under consideration on 23.04.2013. The Ld. Counsel also referred The Ld. Counsel also referred to the receipt issued by the developer dated 23.04.2013 for payment to the receipt issued by the developer dated 23.04.2013 for payment to the receipt issued by the developer dated 23.04.2013 for payment of sum of Rs.2 crores towards the booking of Unit No. C of Rs.2 crores towards the booking of Unit No. C-3501, of Rs.2 crores towards the booking of Unit No. C available on page 10 of paper book. on page 10 of paper book. The Ld. Counsel also referred The Ld. Counsel also referred to the allotment letter dated letter dated 23.04.2023 issued by the developer in 23.04.2023 issued by the developer in respect of Flat No. C respect of Flat No. C-3501, which is available on page 11 of the which is available on page 11 of the Paper Book. The ld Counsel of ld Counsel of assessee submits that the allegation submits that the allegation

Shri Narendra Gehlaut ITA No. 1101/Mum/2022 of the Ld. AO, by relying on the sanction Loan agreement by relying on the sanction Loan agreement by relying on the sanction Loan agreement/sanction letter dated 31.03.2015 2015, that the assessee had booked Unit C had booked Unit C- 2901, is incorrect. The The assessee states that the contention of the states that the contention of the Department that the Department that the assessee had acquired provisional rights in flat provisional rights in flat C-2901, is not correct as the not correct as the assessee had never booked two flats had never booked two flats and the same was clarified by the e was clarified by the assessee during the course of during the course of appellate proceedings vide letter dated 11.11.2021 (annexed at appellate proceedings vide letter dated 11.11.2021 (annexed at appellate proceedings vide letter dated 11.11.2021 (annexed at Pages 49-50 of the Paper Book) as well as during the remand 50 of the Paper Book) as well as during the remand 50 of the Paper Book) as well as during the remand proceedings. Further, Further, the assessee during the remand proceedings during the remand proceedings before the AO, furnished a letter dated 01.12.2021 wherein furnished a letter dated 01.12.2021 wherein furnished a letter dated 01.12.2021 wherein confirmation letter dated 26.11.2021 from the Developer i.e. confirmation letter dated 26.11.2021 from the Developer confirmation letter dated 26.11.2021 from the Developer IndiaBulls intrasestate ltd tate ltd, as well as from as well as from Bank/financial institution i.e. the Indiabulls Commercial Credit Ltd. (ICCL) the Indiabulls Commercial Credit Ltd. (ICCL) the Indiabulls Commercial Credit Ltd. (ICCL), which had given housing loan to the iven housing loan to the assessee (annexed at Page 51 (annexed at Page 51 - 54 of the Additional Paper Book) the Additional Paper Book). It was further stated that It was further stated that the said housing loan was closed by ICCL and sam housing loan was closed by ICCL and same could could be clearly seen from the closure account annexed at Pages 55 losure account annexed at Pages 55 - 58 of the additional 58 of the additional paper book. Thus, it was contested that it was contested that the entire consideration the entire consideration paid was only towards the said Unit C paid was only towards the said Unit C-3501, which was allotted to which was allotted to the assessee on 23.04.2013 and therefore, the 23.04.2013 and therefore, the assessee assessee is justified in claiming the gains arising on the sale of the rights in the said in claiming the gains arising on the sale of the rights in claiming the gains arising on the sale of the rights unit as Long Term Capital Gains unit as Long Term Capital Gains (LTCG).

5.6 Further, the ld counsel of the ld counsel of assessee further reiterated further reiterated that the assessee had made an application with Indiabulls had made an application with Indiabulls Infraestate Ltd, had made an application with Indiabulls

Shri Narendra Gehlaut ITA No. 1101/Mum/2022 for provisional allotment of the flat No. C for provisional allotment of the flat No. C-3501 on 23.04.2013 for 3501 on 23.04.2013 for an agreement value amounting to Rs.23,05,37,750/- On the very an agreement value amounting to Rs.23,05,37,750/ an agreement value amounting to Rs.23,05,37,750/ same day itself, the assessee assessee received a receipt from the Developer received a receipt from the Developer, acknowledging the receipt of Rs.2,00,00,000/ acknowledging the receipt of Rs.2,00,00,000/- from the from the assessee towards Unit No. C towards Unit No. C-3501, as well as an allotment letter as well as an allotment letter dated 23/04/2013 for the said unit. for the said unit. According to the ld Counsel , t According to the ld Counsel , this was first allotment letter issued by the Developer, h letter issued by the Developer, h letter issued by the Developer, however, the Ld. AO relied on the subsequent allotment letter dated 31.10.2015 and AO relied on the subsequent allotment letter dated 31.10.2015 and AO relied on the subsequent allotment letter dated 31.10.2015 and considered the same to be the date on which the said unit was considered the same to be the date on which the said unit was considered the same to be the date on which the said unit was allotted to the assessee assessee. Thus, the Ld. AO computed short term . Thus, the Ld. AO computed short term capital gains at Rs. 13,99,61,282/ capital gains at Rs. 13,99,61,282/- as against long term capital ng term capital gains amounting to Rs.8,96,59,373/ gains amounting to Rs.8,96,59,373/- claimed by the claimed by the assessee. The assessee submits that the date of submits that the date of first allotment dated 23/04/2013, first allotment dated 23/04/2013, on which initial booking amount was on which initial booking amount was paid, ought to have been ought to have been taken as date of accrual of rights in the sai taken as date of accrual of rights in the said unit. As the d unit. As the assessee has held the said right in right in flat for more than 43 months, the same flat for more than 43 months, the same constitutes as long term capital asset and the constitutes as long term capital asset and the assessee assessee has rightly claimed the gains arising out of sale of rights of the said unit as claimed the gains arising out of sale of rights of the said unit as claimed the gains arising out of sale of rights of the said unit as long term capital gain. long term capital gain.

5.7 The ld counsel further ld counsel further relied on the decision of the Hon' ble on the decision of the Hon' ble the case of Gurbax Singh v. Kartar Singh Gurbax Singh v. Kartar Singh Supreme Court in the case of [2002] 254 IT 112 (SC) [2002] 254 IT 112 (SC) wherein it was held that "... it is well wherein it was held that "... it is well- settled that a document on subsequent registration will take effect settled that a document on subsequent registration will take effect settled that a document on subsequent registration will take effect from the time when it was executed and not from the time of its he time when it was executed and not from the time of its he time when it was executed and not from the time of its Shri Narendra Gehlaut ITA No. 1101/Mum/2022 registration." Further, the assesse also relies upon the decision of registration." Further, the assesse also relies upon the decision of registration." Further, the assesse also relies upon the decision of the Hon'ble Bombay High Court in the Hon'ble Bombay High Court in PCIT v. Vembu Vaidyanathan PCIT v. Vembu Vaidyanathan [2019] 413 IT 248 (Bombay) [2019] 413 IT 248 (Bombay) wherein it was held that: wherein it was held that:

"5. This aspect "5. This aspect was further clarified by the CBDT in its later was further clarified by the CBDT in its later circular No.672 dated 16th December, 1993. In such circular No.672 dated 16th December, 1993. In such circular No.672 dated 16th December, 1993. In such circular representations were made to the board that in cases of representations were made to the board that in cases of representations were made to the board that in cases of allotment of flats or houses by co allotment of flats or houses by co-operative societies or other operative societies or other institutions whose schemes of institutions whose schemes of allotment and consideration are allotment and consideration are similar to those of D.D.A., similar view should be taken as was similar to those of D.D.A., similar view should be taken as was similar to those of D.D.A., similar view should be taken as was done in the board circular dated 15th October, 1986. done in the board circular dated 15th October, 1986. done in the board circular dated 15th October, 1986. In the circular dated 16th December, 1993 the board clarified as circular dated 16th December, 1993 the board clarified as circular dated 16th December, 1993 the board clarified as under:

2. The Board has considered the ma 2. The Board has considered the matter and has decided that if tter and has decided that if the terms of the schemes of allotment and construction of the terms of the schemes of allotment and construction of the terms of the schemes of allotment and construction of flats/houses by the co flats/houses by the co-operative societies or other institutions operative societies or other institutions are similar to those mentioned in para 2 of Board's Circular are similar to those mentioned in para 2 of Board's Circular are similar to those mentioned in para 2 of Board's Circular No.471, dated 15 No.471, dated 15-10-1986, such cases may also be treated as so be treated as cases of construction for the purposes of sections 54 and 54F of cases of construction for the purposes of sections 54 and 54F of cases of construction for the purposes of sections 54 and 54F of the Income-tax Act." tax Act." 5.8 In the rejoinder, the Ld. DR submitted a note prepared by the In the rejoinder, the Ld. DR submitted a note prepared by the In the rejoinder, the Ld. DR submitted a note prepared by the Assessing Officer while filing scrutiny report to the Commissioner of Assessing Officer while filing scrutiny report to the Commissioner of Assessing Officer while filing scrutiny report to the Commissioner of Income-tax. In the said report, the Assessing Offi e said report, the Assessing Officer has rebutted cer has rebutted the factual finding recorded by the Ld. CIT(A). The relevant part of nding recorded by the Ld. CIT(A). The relevant part of nding recorded by the Ld. CIT(A). The relevant part of the said note as reproduced as under: the said note as reproduced as under:

“In this case, it is seen from the loan sanction letter dated In this case, it is seen from the loan sanction letter dated In this case, it is seen from the loan sanction letter dated 31.03.2015 issued by Indiabulls Infrastructure Credit Ltd 31.03.2015 issued by Indiabulls Infrastructure Credit Ltd 31.03.2015 issued by Indiabulls Infrastructure Credit Ltd-

Shri Narendra Gehlaut ITA No. 1101/Mum/2022

Transaction date 31.03.2015 that the 'Disbursal Amount of Rs. Transaction date 31.03.2015 that the 'Disbursal Amount of Rs. Transaction date 31.03.2015 that the 'Disbursal Amount of Rs. 13,45,88,871/ 13,45,88,871/- is for a property under description as under is for a property under description as under - Flat No. C- -2901, 29 Floor, Tower No. C, Indiabulls BLU, 901, 29 Floor, Tower No. C, Indiabulls BLU, GanpathraoKadam Marg, Near Worli Circle, Mumbai GanpathraoKadam Marg, Near Worli Circle, Mumbai GanpathraoKadam Marg, Near Worli Circle, Mumbai-400 013 (hereafter referred as C (hereafter referred as C-2901), which has a carpet area of 2901), which has a carpet area of "8294** 2. However, as per the disbursement details prepared, it is 2. However, as per the disbursement details prepared, it is 2. However, as per the disbursement details prepared, it is seen that the loan has been seen that the loan has been sanctioned by M/s. Indiabulls sanctioned by M/s. Indiabulls Commercial Credit Ltd and not by Indiabulls Infrastructure Commercial Credit Ltd and not by Indiabulls Infrastructure Commercial Credit Ltd and not by Indiabulls Infrastructure Credit Ltd. As per this, the amount of Rs. 13,45,88,871/ Credit Ltd. As per this, the amount of Rs. 13,45,88,871/ Credit Ltd. As per this, the amount of Rs. 13,45,88,871/- has been disbursed to Indiabulls Infraestate Ltd. (hereafter referred been disbursed to Indiabulls Infraestate Ltd. (hereafter referred been disbursed to Indiabulls Infraestate Ltd. (hereafter referred as IFL) on 31.03.2015 as per the follow as IFL) on 31.03.2015 as per the following details 3.1 As per the loan sanction letter dated 31.03.2015, the EMI 3.1 As per the loan sanction letter dated 31.03.2015, the EMI 3.1 As per the loan sanction letter dated 31.03.2015, the EMI amount of Rs.25,84,676/ amount of Rs.25,84,676/-is payable every month during the is payable every month during the loan tenure of 240 months. loan tenure of 240 months.

Shri Narendra Gehlaut ITA No. 1101/Mum/2022

Indiabulls Infrastate Ltd. it is submitted that Shri Narendra Indiabulls Infrastate Ltd. it is submitted that Shri Narendra Indiabulls Infrastate Ltd. it is submitted that Shri Narendra Gehlaut had been initially allotted C Gehlaut had been initially allotted C-2901, but on his request 2901, but on his request C-3501 was allotted to him w.e.f. 23.04.2013. In the other 3501 was allotted to him w.e.f. 23.04.2013. In the other 3501 was allotted to him w.e.f. 23.04.2013. In the other declaration of M/s. declaration of M/s. Indiabulls Commercial Credit Ltd., it is Indiabulls Commercial Credit Ltd., it is submitted that the loan documentation vide Account No. submitted that the loan documentation vide Account No. submitted that the loan documentation vide Account No. HHLLVRA00223143 was prepared for Unit No. C HHLLVRA00223143 was prepared for Unit No. C HHLLVRA00223143 was prepared for Unit No. C-2901, but they were later informed that Shri Narendra Gehlaut had they were later informed that Shri Narendra Gehlaut had they were later informed that Shri Narendra Gehlaut had finally chosen Unit No. C finally chosen Unit No. C-3501 in the said project 3501 in the said project. The extracts of the said submissions are reproduced as under On request, of the said submissions are reproduced as under On request, of the said submissions are reproduced as under On request, we hereby confirm that Unit bearing No. C we hereby confirm that Unit bearing No. C-2901 situated at 29* 2901 situated at 29* Level, IndiabullsBlu, GanpatreoKadam Marg. Lower Parel, Level, IndiabullsBlu, GanpatreoKadam Marg. Lower Parel, Level, IndiabullsBlu, GanpatreoKadam Marg. Lower Parel, Mumbei - 400 013 was originally identified by Shri Nerendra 400 013 was originally identified by Shri Nerendra 400 013 was originally identified by Shri Nerendra Gehlaut. However, on his request, unit no. C hlaut. However, on his request, unit no. C-3501 was allotted 3501 was allotted to him w.e.f. 23.04.2013. to him w.e.f. 23.04.2013. We further confirm that Shri Narendra Gehlaut did not hold the We further confirm that Shri Narendra Gehlaut did not hold the We further confirm that Shri Narendra Gehlaut did not hold the units i.e. Unit No. C units i.e. Unit No. C-2901 and Unit No. C-3501 together, at any 3501 together, at any given point of time. given point of time. Sd/- For IndiabullsIn For IndiabullsInfraestate Limited* "To whomsoever it may concern Dated: 26.11.2021 Dated: 26.11.2021 It is hereby confirmed that a home loan was granted to Shri It is hereby confirmed that a home loan was granted to Shri It is hereby confirmed that a home loan was granted to Shri Narendra Gehlautvide Loan Account Narendra Gehlautvide Loan Account No. HHLL VRA00223143 No. HHLL VRA00223143 for a maximum amount of Rs. 258, 887,000/ for a maximum amount of Rs. 258, 887,000/-. Shri Narendra Gehlaut had Shri Narendra Gehlaut had opted for Unit No. C-2901 initially in 2901 initially in Project Project Project IndiabullsBlu, IndiabullsBlu, IndiabullsBlu, 29 29 29 Level, Level, Level, IndiabullsBlu, IndiabullsBlu, IndiabullsBlu, GanpatraoKadam Marg, Near Worli Circle, Mumbai GanpatraoKadam Marg, Near Worli Circle, Mumbai GanpatraoKadam Marg, Near Worli Circle, Mumbai - 400 013 and loan documentation was prepared accordingly. However, and loan documentation was prepared accordingly. However, and loan documentation was prepared accordingly. However, we were later informed he had finally chosen we were later informed he had finally chosen Unit No. Unit No. C-3501 in the said project. in the said project. We hereby confirm that the said loan was closed on 21.2.17. We hereby confirm that the said loan was closed on 21.2.17. We hereby confirm that the said loan was closed on 21.2.17. Sd/- For Indiabulls Commercial Credit Limited” bulls Commercial Credit Limited”

Shri Narendra Gehlaut ITA No. 1101/Mum/2022

6. The above facts show that the assessee is claiming Long 6. The above facts show that the assessee is claiming Long 6. The above facts show that the assessee is claiming Long Term Capital Gains in respect of sale of property being Flat N Term Capital Gains in respect of sale of property being Flat N Term Capital Gains in respect of sale of property being Flat No. C-3501 whereas the loan disbursal document states that the 3501 whereas the loan disbursal document states that the 3501 whereas the loan disbursal document states that the loan was sanctioned for Flat No. C loan was sanctioned for Flat No. C-2901. In this regard, 2901. In this regard, following issues are noticed : following issues are noticed : i. No verifiable evidence has been submitted by the No verifiable evidence has been submitted by the No verifiable evidence has been submitted by the assessee in support of its claim that the Flat No. C-3501 assessee in support of its claim that the Flat No. C assessee in support of its claim that the Flat No. C was allotted on 23.04.2013, except the fact a certificate was allotted on 23.04.2013, except the fact a certificate was allotted on 23.04.2013, except the fact a certificate dated 23.04.2013 from IFL. It may be mentioned that . It may be mentioned that dated 23.04.2013 from IFL the assessee is a related party of this group the assessee is a related party of this group the assessee is a related party of this group concern and such a self concern and such a self-supporting certificate is supporting certificate is not verifiable/reliable document. not verifiable/reliable document. ii. As regards the As regards the bank statement of assessee (HDFC Bank) bank statement of assessee (HDFC Bank) evidencing payment of Rs. 2 crores vide Cheque evidencing payment of Rs. 2 crores vide Cheque evidencing payment of Rs. 2 crores vide Cheque No.876744 dated 23.04.2013 to IFL.it does not establish No.876744 dated 23.04.2013 to IFL.it does not establish No.876744 dated 23.04.2013 to IFL.it does not establish that this payment of Rs.2 crores was paid for Flat that this payment of Rs.2 crores was paid for Flat that this payment of Rs.2 crores was paid for Flat No.3501 as claimed by the assessee as per the above No.3501 as claimed by the assessee as per the above No.3501 as claimed by the assessee as per the above certificate certificatedated 23.04.2013 of IFL. It may also be noted dated 23.04.2013 of IFL. It may also be noted that the source of this payment is an amount of Rs.2 that the source of this payment is an amount of Rs.2 that the source of this payment is an amount of Rs.2 crores crores crores received received received by by by the the the assessee assessee assessee from from from Revati Revati Revati Infrastructure on 18.04.2013. Further, from the bank Infrastructure on 18.04.2013. Further, from the bank Infrastructure on 18.04.2013. Further, from the bank statement of the assessee it is also seen that the statement of the assessee it is also seen that the statement of the assessee it is also seen that the assessee assessee has also made a similar payment of Rs.7.5 has also made a similar payment of Rs.7.5 crore to M/s. Aspire Promoters (Pvt.) Ltd. on 30.04.2013. crore to M/s. Aspire Promoters (Pvt.) Ltd. on 30.04.2013. crore to M/s. Aspire Promoters (Pvt.) Ltd. on 30.04.2013. The source of this payment is an account of credit entry The source of this payment is an account of credit entry The source of this payment is an account of credit entry of Rs.7.5 of Rs.7.5 crore on 29.04.2013 from Revati Infrastructure. crore on 29.04.2013 from Revati Infrastructure. iii. No details of the procedure followed in respect of No details of the procedure followed in r No details of the procedure followed in r the change of flat has been submitted by the the change of flat has been submitted by the the change of flat has been submitted by the assessee as compared to similar procedure, if any, assessee as compared to similar procedure, if any, assessee as compared to similar procedure, if any, being followed by the assessee in respect of other being followed by the assessee in respect of other being followed by the assessee in respect of other cases for change of flat. cases for change of flat. It may be mentioned in the It may be mentioned in the certificate dated 26.11.2021, issued by M/s. Indiabulls certificate dated 26.11.2021, issued by M/s. I certificate dated 26.11.2021, issued by M/s. I Commercial Credit Ltd.. inter alia, it is stated that Shri Commercial Credit Ltd.. inter alia, it is stated that Shri Commercial Credit Ltd.. inter alia, it is stated that Shri Narendra Gehlaut had opted initially for Unit No. C-2901, Narendra Gehlaut had opted initially for Unit No. C Narendra Gehlaut had opted initially for Unit No. C but they were later informed that the assessee had but they were later informed that the assessee had but they were later informed that the assessee had finally chosen Unit No. C finally chosen Unit No. C-3501 in the said project. No 3501 in the said project. No details when this chang details when this change and in what manner (whether e and in what manner (whether by any verifiable mail or any such verifiable evidence) by any verifiable mail or any such verifiable evidence) by any verifiable mail or any such verifiable evidence) was intimated with respect to this change. However, it is was intimated with respect to this change. However, it is was intimated with respect to this change. However, it is confirmed that Shri Narendra Gehlaut had initially opted confirmed that Shri Narendra Gehlaut had initially opted confirmed that Shri Narendra Gehlaut had initially opted for Flat NO. C for Flat NO. C-2901. But no details and circumstances i 2901. But no details and circumstances in which and when he was allotted C which and when he was allotted C-2901 and when he 2901 and when he

Shri Narendra Gehlaut ITA No. 1101/Mum/2022 opted out of C opted out of C-2901 and was subsequently allotted C 2901 and was subsequently allotted C- 3501 has been submitted by him. It is worth mentioning 3501 has been submitted by him. It is worth mentioning 3501 has been submitted by him. It is worth mentioning that loan sanction letter dated 31.03.2015 for Unit No. C- that loan sanction letter dated 31.03.2015 for Unit No. C that loan sanction letter dated 31.03.2015 for Unit No. C 2901 is subsequent to provisional allot 2901 is subsequent to provisional allotment of Unit No. C ment of Unit No. C- 3501 vide letter dated 23.04.2013. Therefore, certificate 3501 vide letter dated 23.04.2013. Therefore, certificate 3501 vide letter dated 23.04.2013. Therefore, certificate dated 26.11.2021 issued by both IL & ICCL is self- dated 26.11.2021 issued by both IL & ICCL is self dated 26.11.2021 issued by both IL & ICCL is self contradictory, inasmuch as assessee's opting for flat No contradictory, inasmuch as assessee's opting for flat No contradictory, inasmuch as assessee's opting for flat No C-3501 cannot be an occasion prior to date of loan 3501 cannot be an occasion prior to date of loan 3501 cannot be an occasion prior to date of loan sanction letter dated sanction letter dated 31.03.2015, which clearly mentions 31.03.2015, which clearly mentions details of property towards which loan was sanctioned details of property towards which loan was sanctioned details of property towards which loan was sanctioned i.e. C-2901. 2901. iv. Further, in the certificate dated 26.11.2021 submitted by Further, in the certificate dated 26.11.2021 submitted by Further, in the certificate dated 26.11.2021 submitted by IFL, it is inter IFL, it is inter-alia stated that it is confirmed that Shri alia stated that it is confirmed that Shri Narendra Gehlaut did not hold both Narendra Gehlaut did not hold both the Unit No. C the Unit No. C-2901 and Unit No. C and Unit No. C-3501 together, at any given point of time 3501 together, at any given point of time thereby admitting that Shri Narendra Gehlaut held the thereby admitting that Shri Narendra Gehlaut held the thereby admitting that Shri Narendra Gehlaut held the Flat No. 2901 at some point of time, the details which are Flat No. 2901 at some point of time, the details which are Flat No. 2901 at some point of time, the details which are not submitted by the assessee. The Loan Disbursal not submitted by the assessee. The Loan Disbursal not submitted by the assessee. The Loan Disbursal Certificate date Certificate dated 31.03.2015 clearly mentions that Flat d 31.03.2015 clearly mentions that Flat No. 2901 was held by Shri Narendra Gehlaut. No. 2901 was held by Shri Narendra Gehlaut. No. 2901 was held by Shri Narendra Gehlaut. v. Further, on perusal of the first page of the impugned Further, on perusal of the first page of the impugned Further, on perusal of the first page of the impugned Application Form (Page 1 Application Form (Page 1 -18- page numbering made by page numbering made by this Office) submitted by the assessee, vide which it has this Office) submitted by the assessee, vide which it has this Office) submitted by the assessee, vide which it has been cl been claimed that the Flat No. 3501 was allotted to him aimed that the Flat No. 3501 was allotted to him on 23.04.2013 does not indicate any amount or cheque on 23.04.2013 does not indicate any amount or cheque on 23.04.2013 does not indicate any amount or cheque number vide which the so called payment was made, number vide which the so called payment was made, number vide which the so called payment was made, which is very unlikely in respect of booking of a flat. No which is very unlikely in respect of booking of a flat. No which is very unlikely in respect of booking of a flat. No such requirement of terms and payment conditions has such requirement of terms and payment conditi such requirement of terms and payment conditi also been indicated in the Payment Plan CLPP - Toner 'C" also been indicated in the Payment Plan CLPP also been indicated in the Payment Plan CLPP (Page 12 of the Application Form) of this Application Form (Page 12 of the Application Form) of this Application Form (Page 12 of the Application Form) of this Application Form to demonstrate that an amount of Rs. 2 crore payment to demonstrate that an amount of Rs. 2 crore payment to demonstrate that an amount of Rs. 2 crore payment was required as a pre was required as a pre-booking amount for booking either booking amount for booking either Flat No. C Flat No. C-2901 and C-3501, or this payment of Rs. 2 501, or this payment of Rs. 2 croreswas payment for some other purpose which has croreswas payment for some other purpose which has croreswas payment for some other purpose which has been given a colour of payment received for the booking been given a colour of payment received for the booking been given a colour of payment received for the booking of Flat No. C of Flat No. C-3501. It is seen that the signature of the It is seen that the signature of the assessee is on two different dates (i.e. 23.04.2013 and assessee is on two different dates (i.e. 23.04.2013 and assessee is on two different dates (i.e. 23.04.2013 and 23.04. 23.04.2016) on different pages of the same form as 2016) on different pages of the same form as under raising doubt that this document was signed on under raising doubt that this document was signed on under raising doubt that this document was signed on 23.04.2013. 23.04.2013.

Shri Narendra Gehlaut ITA No. 1101/Mum/2022 (vi) Para 3 of the MOU dated 14.12.2016 in respect of the sale Para 3 of the MOU dated 14.12.2016 in respect of the sale Para 3 of the MOU dated 14.12.2016 in respect of the sale of Flat No. C- of Flat No. C-3501 reads as under - "Simultaneously upon execution hereof the All Simultaneously upon execution hereof the Allottee has Simultaneously upon execution hereof the All handed over to the Purchasers th handed over to the Purchasers the Letter of Allotment e Letter of Allotment dated 31st October 2015 in original. Save and expect the October 2015 in original. Save and expect the October 2015 in original. Save and expect the Letter of Allotment the Allottee has no other document or Letter of Allotment the Allottee has no other document or Letter of Allotment the Allottee has no other document or paper in his possession or control in respect of the paper in his possession or control in respect of the paper in his possession or control in respect of the Premises." As per the above para, the letter of Allotment dated 31.10.2015 above para, the letter of Allotment dated 31.10.2015 above para, the letter of Allotment dated 31.10.2015 has been considered as the only document or paper showing has been considered as the only document or paper showing has been considered as the only document or paper showing possession or control in respect of Flat No. C possession or control in respect of Flat No. C-3501. 3501. (vii) As per para 3 of the Application Form (at Page No. 14) As per para 3 of the Application Form (at Page No. 14) As per para 3 of the Application Form (at Page No. 14) under the head "Price details". under the head "Price details". the following condition has been the following condition has been mentioned - "Apart from an addition to the sale price of the said Unit, the "Apart from an addition to the sale price of the said Unit, the "Apart from an addition to the sale price of the said Unit, the applicant shall pay the following amounts to the company applicant shall pay the following amounts to the company applicant shall pay the following amounts to the company - (a) Rs.50,000/ (a) Rs.50,000/- (Rupees Fifty Thousand) towards legal charges (Rupees Fifty Thousand) towards legal charges and towards cost of and towards cost of preparing and engrossing this agreement preparing and engrossing this agreement - no such details were furnished regarding this payment either no such details were furnished regarding this payment either no such details were furnished regarding this payment either for Flat No. C for Flat No. C-3501 or C-2901, which is the flat allotted to the 2901, which is the flat allotted to the assessee as per the loan disbursement document. assessee as per the loan disbursement document. assessee as per the loan disbursement document.

Shri Narendra Gehlaut ITA No. 1101/Mum/2022 for Flat No. C for Flat No. C-2901 and not C-3501. This Loan Disbursement 3501. This Loan Disbursement document is considered to be verifiable because as per this document is considered to be verifiable because as per this document is considered to be verifiable because as per this document an amount of loan of Rs. 13,45,88,871/ document an amount of loan of Rs. 13,45,88,871/ document an amount of loan of Rs. 13,45,88,871/- was disbursed by Indiabulls Infrastructure Credit Ltd. to M/s. disbursed by Indiabulls Infrastructure Credit Ltd. to M/s. disbursed by Indiabulls Infrastructure Credit Ltd. to M/s. Indiabulls Infrastate Ltd Indiabulls Infrastate Ltd. vide their Reference No. 471337 to the . vide their Reference No. 471337 to the applicant Shri Narendra Gehlaut. Further, the above issues applicant Shri Narendra Gehlaut. Further, the above issues applicant Shri Narendra Gehlaut. Further, the above issues noticed at SI No. (i) to (vi) does not support the correctness of the noticed at SI No. (i) to (vi) does not support the correctness of the noticed at SI No. (i) to (vi) does not support the correctness of the claim of the assesse regarding the allotment of Flat No. C claim of the assesse regarding the allotment of Flat No. C claim of the assesse regarding the allotment of Flat No. C-3501 to him on 23.04.2013. to him on 23.04.2013.

“Date: December 1, 2021 Date: December 1, 2021 The Dy. Commissioner of Income Tax The Dy. Commissioner of Income Tax Central Circle Central Circle-6(4), 19th Floor, Air India Building, Nariman Point, Air India Building, Nariman Point, Mumbai - 400021 400021 Dear Sir,

Shri Narendra Gehlaut ITA No. 1101/Mum/2022

Sub: Reply to remand report proceeding in case of Shri Narendra Reply to remand report proceeding in case of Shri Narendra Reply to remand report proceeding in case of Shri Narendra Gehlaut ("the assessee") having Gehlaut ("the assessee") having PAN AAZPG9630K for AY 2017 PAN AAZPG9630K for AY 2017-18 DIN: ITBA/COM/F/17/2021 ITBA/COM/F/17/2021-22/1037124761(1) dated 22.11.21 22/1037124761(1) dated 22.11.21 With reference to your query relating to interplay between Unit No. With reference to your query relating to interplay between Unit No. With reference to your query relating to interplay between Unit No. 2901 and C-3501, it is submitted that the assessee had it is submitted that the assessee had C-2901 and C originally opted for Unit No. C originally opted for Unit No. C-2901 but later shifted to Unit 2901 but later shifted to Unit No. C- 3501. The request of the assessee was entertained by 3501. The request of the assessee was entertained by 3501. The request of the assessee was entertained by the Developer and relevant documents were accordingly loper and relevant documents were accordingly loper and relevant documents were accordingly modified. However, it is just a matter of chance that documentation with the However, it is just a matter of chance that documentation with the However, it is just a matter of chance that documentation with the lender continued in old unit number. However, records of the lender continued in old unit number. However, records of the lender continued in old unit number. However, records of the developer were perfectly aligned and both the parties had always developer were perfectly aligned and both the parties had always developer were perfectly aligned and both the parties had always mutually consented for Unit No. C y consented for Unit No. C-3501. A confirmation thereto from 3501. A confirmation thereto from the Developer is enclosed here the Developer is enclosed here-with as Annexure-

1. 1.

1. The The The factual factual factual position position position regarding regarding regarding shifting shifting shifting of of of unit unit unit was was was duly duly duly communicated during the course of assessment proceedings vide communicated during the course of assessment proceedings vide communicated during the course of assessment proceedings vide Annexure-VI of our submis VI of our submission dt. 21.12.18. A copy of the same is sion dt. 21.12.18. A copy of the same is enclosed here enclosed here-with as Annexure-2. The said factual position is also 2. The said factual position is also evident in the Application Form made by the assessee to the evident in the Application Form made by the assessee to the evident in the Application Form made by the assessee to the Developer where Developer where-in; it is mentioned on the First Page itself that the in; it is mentioned on the First Page itself that the assessee is shift assessee is shifting Unit from C-2901 to C-3501. A copy of the same 3501. A copy of the same is enclosed as Annexure is enclosed as Annexure-3. It is important to note that the assessee did not take possession of It is important to note that the assessee did not take possession of It is important to note that the assessee did not take possession of immovable property and only relinquished his allotment rights. immovable property and only relinquished his allotment rights. immovable property and only relinquished his allotment rights. Hence, there was no occasion for the lender to Hence, there was no occasion for the lender to Hence, there was no occasion for the lender to get its records corrected. And once the rights were sold, the lender got its money corrected. And once the rights were sold, the lender got its money corrected. And once the rights were sold, the lender got its money back and closed the assessee's loan account. Confirmation from the back and closed the assessee's loan account. Confirmation from the back and closed the assessee's loan account. Confirmation from the lender regarding the same is lender regarding the same is enclosed here-with as Annexure with as Annexure-4. In the humble submission of the assessee, the humble submission of the assessee, incorrect Unit no. in the incorrect Unit no. in the lender's records does not vitiate assessee's argument that he got the lender's records does not vitiate assessee's argument that he got the lender's records does not vitiate assessee's argument that he got the allotment rights on 23.04.2013. More so, when agreement between allotment rights on 23.04.2013. More so, when agreement between allotment rights on 23.04.2013. More so, when agreement between the assessee and the Developer is absolutely clear about the unit the assessee and the Developer is absolutely clear about the unit the assessee and the Developer is absolutely clear about the unit number. We humbly request your We humbly request your good-self to consider the facts of the self to consider the facts of the assessee's case rationally while giving due consideration to assessee's case rationally while giving due consideration to assessee's case rationally while giving due consideration to business realities. business realities.”

Shri Narendra Gehlaut ITA No. 1101/Mum/2022 5.10 The assessee has also filed a letter from the India Bulls The assessee has also filed a letter from the The assessee has also filed a letter from the Infra Esate ltd (now known as Indiabulls Real Estate) that assessee (now known as Indiabulls Real Estate) that assessee (now known as Indiabulls Real Estate) that assessee did not hold both the units i.e. Unit No. C did not hold both the units i.e. Unit No. C-2901 and Unit No. 3501 2901 and Unit No. 3501 together at any given point of time and initially the assessee booked together at any given point of time and initially the assessee booked together at any given point of time and initially the assessee booked Unit No. 2901 which was later on Unit No. 2901 which was later on his request changed changed to Unit No. C-3501. The assessee has also filed a letter from the banker i.e. 3501. The assessee has also filed a letter from the banker i.e. 3501. The assessee has also filed a letter from the banker i.e. Indiabulls Commercial Credit Ltd. that initially loan was sanctioned Indiabulls Commercial Credit Ltd. that initially loan was sanctioned Indiabulls Commercial Credit Ltd. that initially loan was sanctioned for Unit No. C-2901, h 2901, however later on, the assessee informed that the assessee informed that Unit No. C-3501 was chosen. The said loan was closed on 3501 was chosen. The said loan was closed on 3501 was chosen. The said loan was closed on 21.02.2017. In view of the above facts, it 21.02.2017. In view of the above facts, it seems that initially the that initially the assessee had been allotted Unit No been allotted Unit No. C-2901 and later on the same 2901 and later on the same has been changed to C has been changed to C-3501 on the request of the 3501 on the request of the assessee and accordingly provisional allotment letter provisional allotment letter has been issued on has been issued on 31.10.2015 for flat C C-3501, which has been referred in the MO , which has been referred in the MOU dated 14/12/2016 for transfer of the right in the said flat. It is for transfer of the right in the said flat. It is for transfer of the right in the said flat. It is clearly mentioned that the said flat was allotted to the assessee on clearly mentioned that the said flat was allotted to the assessee on clearly mentioned that the said flat was allotted to the assessee on 31.10.2015. This document has been signed by the assessee his document has been signed by the assessee his document has been signed by the assessee as well as buyers/purchasers s/purchasers of the rights in the flat. In the of the rights in the flat. In the said MOU, there is no mention of there is no mention of any prior allotment of the flat C allotment of the flat C-3501 on 23.04.2013. Therefore, the allotment letter prepared and submitted 23.04.2013. Therefore, the allotment letter prepared and submitted 23.04.2013. Therefore, the allotment letter prepared and submitted by the assessee dated 23.04.2013 does not seems to assessee dated 23.04.2013 does not seems to assessee dated 23.04.2013 does not seems to be an authentic copy. Further, Further, para 3 of the MOU dated 14.12.2016 in para 3 of the MOU dated 14.12.2016 in respect of the sale of Flat No. C respect of the sale of Flat No. C-3501 reads as under 3501 reads as under -

"Simultaneously upon execution hereof the Allottee has handed Simultaneously upon execution hereof the Allottee has handed Simultaneously upon execution hereof the Allottee has handed over to the Purchasers the Letter of Allotment dated 31 over to the Purchasers the Letter of Allotment dated 31 over to the Purchasers the Letter of Allotment dated 31st

Shri Narendra Gehlaut ITA No. 1101/Mum/2022

October 2015 in original. Save and expect the Letter of 2015 in original. Save and expect the Letter of 2015 in original. Save and expect the Letter of Allotment the Allottee has no other document or paper in his Allotment the Allottee has no other document or paper in his Allotment the Allottee has no other document or paper in his possession or control in respect of the Premises." possession or control in respect of the Premises 5.11. As per the above para, the letter of Allotment dated As per the above para, the letter of Allotment dated As per the above para, the letter of Allotment dated 31.10.2015 has been considered as the 31.10.2015 has been considered as the only document or paper only document or paper showing possession or control in respect of Flat No. C-3501and showing possession or control in respect of Flat No. C showing possession or control in respect of Flat No. C there is no reference of any allotment letter dated 23/04/2013 . there is no reference of any allotment letter dated 23/04/2013 . there is no reference of any allotment letter dated 23/04/2013 .

5.12. This fact of allotment dated 31/10/2015 , of allotment dated 31/10/2015 , also gets also gets supported from the loan sanction letter the loan sanction letter dated 31.03.2015 which is in respect 31.03.2015 which is in respect of flat No. C-2901. It is to be noted here that the assessee i.e. flat It is to be noted here that the assessee i.e. flat It is to be noted here that the assessee i.e. flat owner, Developer, Bank/ financial institution, all are part of same owner, Developer, Bank/ financial institution, all are part of same owner, Developer, Bank/ financial institution, all are part of same ‘Indiabulls’ group and therefore possibility of making documents at ‘Indiabulls’ group and therefore possibility of making documents at ‘Indiabulls’ group and therefore possibility of making documents at their convenience can’t be denied. The authenticity of the receipt of can’t be denied. The authenticity of the receipt of can’t be denied. The authenticity of the receipt of Rs. 2.00 lakhs dated 23/04/2013 mentioning flat No. C-3501 and Rs. 2.00 lakhs dated 23/04/2013 mentioning flat No. C Rs. 2.00 lakhs dated 23/04/2013 mentioning flat No. C allotment letter dated 23/04/2013 are tment letter dated 23/04/2013 are therefore not reliable. therefore not reliable. Further, during the course of hearing before us, the ld counsel of Further, during the course of hearing before us, the ld counsel of Further, during the course of hearing before us, the ld counsel of the assessee was asked as the immovable property rights have been e was asked as the immovable property rights have been e was asked as the immovable property rights have been transferred by the ass transferred by the assessee in favour of the purchasers essee in favour of the purchasers parties for a value more than Rs. 100/ value more than Rs. 100/- and thus as per Transfer of Immovable and thus as per Transfer of Immovable Property Act, 1882 , the sale transaction must have been registered Property Act, 1882 , the sale transaction must have been Property Act, 1882 , the sale transaction must have been before the stamp duty authorities and the said document might before the stamp duty authorities and the said document might before the stamp duty authorities and the said document might have details of date of allotment of flat C have details of date of allotment of flat C-3501 to the assessee, but 3501 to the assessee, but no such copy of registered registered sale deed was filed before us. sale deed was filed before us. In the caselaws relied upon by the assessee caselaws relied upon by the assessee, it is held that date of , it is held that date of allotment of flat should be taken as date of construction of property allotment of flat should be taken as date of construction of property allotment of flat should be taken as date of construction of property

Shri Narendra Gehlaut ITA No. 1101/Mum/2022 for the purpose of section 54F of the Act, but in the instant case for the purpose of section 54F of the Act, but in the instant case for the purpose of section 54F of the Act, but in the instant case issue is determination of date of allotment itself. There is no dispute issue is determination of date of allotment itself. There is no dispute issue is determination of date of allotment itself. There is no dispute on the ratio laid dow on the ratio laid down in caselaws, accordingly those caselaws are those caselaws are distinguishable. Befo Before the Ld. CIT(A), it was submitted that for it was submitted that for computing the holding period for capital gain computing the holding period for capital gain, the period should be the period should be taken from the date of the application of the flat however, we do not taken from the date of the application of the flat however taken from the date of the application of the flat however agree with the said contention of the assessee. The rights of the with the said contention of the assessee. The rights of the with the said contention of the assessee. The rights of the assessee arise in the said flat only on the allotment and not by way assessee arise in the said flat only on the allotment and not by way assessee arise in the said flat only on the allotment and not by way of filing application. The confirmation letter filed from the developer of filing application. The confirmation letter filed from the developer of filing application. The confirmation letter filed from the developer as well as from the bank also shows that the flat No. C-3501 was as well as from the bank also shows that the flat No. C as well as from the bank also shows that the flat No. C not allotted initially to the assessee though the developer has not allotted initially to the assessee though the developer has not allotted initially to the assessee though the developer has submitted a letter that assessee has not submitted a letter that assessee has not held two units in the said two units in the said building at any point of time. Before us, the issue is only in respect building at any point of time. Before us, the issue is only in respect building at any point of time. Before us, the issue is only in respect of holding period of the right in flat No. of holding period of the right in flat No. C-3501 and therefore, we 3501 and therefore, we are not concerned whether the assessee had purchased both the are not concerned whether the assessee had purchased both the are not concerned whether the assessee had purchased both the properties i.e. C-2901 and C 2901 and C-3501. That might be a might be a matter for investigation by the Assessing Officer investigation by the Assessing Officer. On appreciation of the n appreciation of the factual evidences produced before us, s produced before us, we are of the view that the of the view that the flat C-3501 has been allotted to the assessee on 3 3501 has been allotted to the assessee on 3 3501 has been allotted to the assessee on 31.10.2015 as mentioned in the MO mentioned in the MOU dated 14.12.2016, which is a document which is a document signed by the buyer a signed by the buyer as well as seller of the rights, therefore, the s well as seller of the rights, therefore, the holding period of the rights in Flat C holding period of the rights in Flat C-3501 is less than 36 months is less than 36 months and thus gain arising from transfer of said rights is short term and thus gain arising from transfer of said rights is short term and thus gain arising from transfer of said rights is short term capital gain (STCG) only. capital gain (STCG) only.

Shri Narendra Gehlaut ITA No. 1101/Mum/2022 5.13 In view of aforesaid discussion n view of aforesaid discussion, we set aside the finding of the we set aside the finding of the Ld. CIT(A) on the issue in dispute and uphold the finding of the Ld. CIT(A) on the issue in dispute and uphold the finding of the Ld. CIT(A) on the issue in dispute and uphold the finding of the Assessing Officer to treat the gain on transfer of right in the Unit C ing Officer to treat the gain on transfer of right in the Unit C ing Officer to treat the gain on transfer of right in the Unit C- 3501 as short term capital gain. 3501 as short term capital gain.

6.1 Before us, the Ld. Counsel of the assessee submitted that Before us, the Ld. Counsel of the assessee submitted that Before us, the Ld. Counsel of the assessee submitted that since right in flat were were acquired by way of funds borrowed from the borrowed from the Bank/financial institution institution, therefore, the interest paid towards the interest paid towards such loan should be included in the total cost of acquisition of such loan should be included in the total cost of acquisition such loan should be included in the total cost of acquisition right. In support of claim, the assessee relied on the decision of the . In support of claim, the assessee relied on the decision of the . In support of claim, the assessee relied on the decision of the Tribunal in Jodhpur Bench in the case of Tribunal in Jodhpur Bench in the case of Gyatri Maheshwari v. ITO. Gyatri Maheshwari v. ITO. (supra), which was cited b which was cited before the Ld CIT(A). The relevant part of The relevant part of the decision reproduced the decision reproduced by Ld CIT(A) is extracted as under: as under:

"it is very much clear that if the property is purchased from "it is very much clear that if the property is purchased from "it is very much clear that if the property is purchased from borrowed funds then consideration for the purchased amount, borrowed funds then consideration for the purchased amount, borrowed funds then consideration for the purchased amount, the interest on borrowed fund a the interest on borrowed fund also has to be paid. The amount lso has to be paid. The amount of interest paid by the assessee constitutes the actual cost to of interest paid by the assessee constitutes the actual cost to of interest paid by the assessee constitutes the actual cost to the assessee for that property. To exclude the interest amount the assessee for that property. To exclude the interest amount the assessee for that property. To exclude the interest amount from the actual cost of the assets/property would lead from the actual cost of the assets/property would lead from the actual cost of the assets/property would lead anomalous result. The interest amount shoul anomalous result. The interest amount should be definitely d be definitely added to the actual cost of the property. Respectfully following added to the actual cost of the property. Respectfully following added to the actual cost of the property. Respectfully following these legal propositions and on basis of our observations as these legal propositions and on basis of our observations as these legal propositions and on basis of our observations as held herein, we reverse the findings of the Id. CIT(A) and hold held herein, we reverse the findings of the Id. CIT(A) and hold held herein, we reverse the findings of the Id. CIT(A) and hold that the interest paid to bank for acquiring capit that the interest paid to bank for acquiring capital asset would al asset would be eligible as part of cost of acquisition. be eligible as part of cost of acquisition.”

Shri Narendra Gehlaut ITA No. 1101/Mum/2022 6.2 On the contrary, the Ld. DR submitted that interest is On the contrary, the Ld. DR submitted that interest is On the contrary, the Ld. DR submitted that interest is not allowable as cost of acquisition to the assessee for two reasons. allowable as cost of acquisition to the assessee for two reasons. allowable as cost of acquisition to the assessee for two reasons. Firstly, the documentary evidences of loan sanction letter is not i , the documentary evidences of loan sanction letter is not in , the documentary evidences of loan sanction letter is not i respect of the Flat C respect of the Flat C-3501 and therefore, the assessee can’t be 3501 and therefore, the assessee can’t be allowed deduction of the interest paid as cost of acquisition for allowed deduction of the interest paid as cost of acquisition for allowed deduction of the interest paid as cost of acquisition for housing loan taken for Flat No. C housing loan taken for Flat No. C-2901. Secondly, Secondly, he submitted that interest paid on housing loan that interest paid on housing loan in respect of right acquir right acquired in flat is a financial liability of the assessee financial liability of the assessee and not part of the cost of not part of the cost of acquisition. He submitted that said interest payment is allowable e submitted that said interest payment is allowable e submitted that said interest payment is allowable under the head ‘income from house property ‘income from house property income from house property' as revenue expenditure and therefore, cannot be included as part of capital expenditure and therefore, cannot be included as part of capital expenditure and therefore, cannot be included as part of capital expenditure for computing cost of acquisition. expenditure for computing cost of acquisition.

6.3 We have heard rival submission of the parties and perused the We have heard rival submission of the parties and perused the We have heard rival submission of the parties and perused the relevant material on record. relevant material on record. We find that the issue of interest p We find that the issue of interest paid on housing loan whether eligible for deduction as cost of acquisition on housing loan whether eligible for deduction as cost of acquisition on housing loan whether eligible for deduction as cost of acquisition while computing long while computing long-term capital gain hasn’t decided by the term capital gain hasn’t decided by the Tribunal Delhi bench in order dated 30/09/2015 in the case of Tribunal Delhi bench in order dated 30/09/2015 in the case of Tribunal Delhi bench in order dated 30/09/2015 in the case of ACIT Vs Sunil Batra in /Del/2011 for assessment ACIT Vs Sunil Batra in ITA No. 3644 /Del/2011 for assessmen ACIT Vs Sunil Batra in ITA No. 3644 /Del/2011 for assessmen year 2007-08. The tribunal relied on the decision of the Hon’ble 08. The tribunal relied on the decision of the Hon’ble 08. The tribunal relied on the decision of the Hon’ble Supreme Court in the case of CIT Vs Tata Iron and steel Co Ltd(231 Supreme Court in the case of CIT Vs Tata Iron and steel Co Ltd( Supreme Court in the case of CIT Vs Tata Iron and steel Co Ltd( ITR 285 SC) . The Hon’ble Supreme Court held that cost of the asset . The Hon’ble Supreme Court held that cost of the asset . The Hon’ble Supreme Court held that cost of the asset and cost of raising money for purchase of the asset, are two and cost of raising money for purchase of the asset, a and cost of raising money for purchase of the asset, a different transactions. The relevant finding of the Hon’ble Supreme transactions. The relevant finding of the Hon’ble Supreme transactions. The relevant finding of the Hon’ble Supreme Court is reproduced as under: Court is reproduced as under:

Shri Narendra Gehlaut ITA No. 1101/Mum/2022

“We are of the view that Mr. Murthy is right in his contention on this We are of the view that Mr. Murthy is right in his contention on this We are of the view that Mr. Murthy is right in his contention on this aspect of the matter. Coming to the question raised, we find it difficult aspect of the matter. Coming to the question raised, we find it difficult aspect of the matter. Coming to the question raised, we find it difficult to follow how the manner of repayment of loan can affect the cost of low how the manner of repayment of loan can affect the cost of low how the manner of repayment of loan can affect the cost of the assets acquired by the assessee. What is the actual cost must the assets acquired by the assessee. What is the actual cost must the assets acquired by the assessee. What is the actual cost must depend on the amount paid by the assessee to acquire the asset. The depend on the amount paid by the assessee to acquire the asset. The depend on the amount paid by the assessee to acquire the asset. The amount may have been borrowed by the assessee, but even if amount may have been borrowed by the assessee, but even if amount may have been borrowed by the assessee, but even if the assessee did not repay the loan it will not alter the cost of the asset. assessee did not repay the loan it will not alter the cost of the asset. assessee did not repay the loan it will not alter the cost of the asset. If the borrower defaults in repayment of a part of the loan, the cost of If the borrower defaults in repayment of a part of the loan, the cost of If the borrower defaults in repayment of a part of the loan, the cost of the asset will not change. What has to be borne in mind is that the the asset will not change. What has to be borne in mind is that the the asset will not change. What has to be borne in mind is that the cost of an asset and the cost of raisi cost of an asset and the cost of raising money for purchase of the ng money for purchase of the asset are two different and independent transactions. Even if an asset are two different and independent transactions. Even if an asset are two different and independent transactions. Even if an asset is purchased with non asset is purchased with non-repayable subsidy received from the repayable subsidy received from the Government, the cost of the asset will be the price paid by the Government, the cost of the asset will be the price paid by the Government, the cost of the asset will be the price paid by the assessee for acquiring the asset. assessee for acquiring the asset. In the instant case, the allegation is In the instant case, the allegation is that at the time of Commissioner Of Income that at the time of Commissioner Of Income-Tax vs Tata Iron And Tax vs Tata Iron And Steel Steel Steel Co. Co. Co. Ltd. Ltd. Ltd. on on on 17 17 17 December, December, December, 1997 1997 1997 Indian Indian Indian Kanoon Kanoon Kanoon - http://indiankanoon.org/doc/1182664/ 1 repayment of loan, there http://indiankanoon.org/doc/1182664/ 1 repayment of loan, there http://indiankanoon.org/doc/1182664/ 1 repayment of loan, there was a fluctuation in the rate of fore was a fluctuation in the rate of foreign exchange as a result of which, ign exchange as a result of which, the assessee bad to repay a much lesser amount than he would have the assessee bad to repay a much lesser amount than he would have the assessee bad to repay a much lesser amount than he would have otherwise paid. In our judgment, this is not a factor which can alter otherwise paid. In our judgment, this is not a factor which can alter otherwise paid. In our judgment, this is not a factor which can alter the cost incurred by the assessee for purchase of the asset. The the cost incurred by the assessee for purchase of the asset. The the cost incurred by the assessee for purchase of the asset. The assessee may have ra assessee may have raised the funds to purchase the asset by ised the funds to purchase the asset by borrowing but what the assessee has paid for it, is the price of the borrowing but what the assessee has paid for it, is the price of the borrowing but what the assessee has paid for it, is the price of the asset. That price cannot change by any event subsequent to the asset. That price cannot change by any event subsequent to the asset. That price cannot change by any event subsequent to the acquisition of the asset. In our judgment, the manner or mode of acquisition of the asset. In our judgment, the manner or mode of acquisition of the asset. In our judgment, the manner or mode of repayment of the lo repayment of the loan has nothing to do with the cost of an asset an has nothing to do with the cost of an asset acquired by the assessee for the purpose of his business. We hold acquired by the assessee for the purpose of his business. We hold acquired by the assessee for the purpose of his business. We hold that the questions were rightly answered by the High Court. The that the questions were rightly answered by the High Court. The that the questions were rightly answered by the High Court. The appeals are dismissed. There will be no order as to costs. appeals are dismissed. There will be no order as to costs. appeals are dismissed. There will be no order as to costs.” 6.4 Though in above case, the issue was impact of fluctuation Though in above case, the issue was impact of fluctuation Though in above case, the issue was impact of fluctuation of foreign currency loan borrowed for purchase of the asset, but of foreign currency loan borrowed for purchase of the asset, but of foreign currency loan borrowed for purchase of the asset, but the same analogy apply for interest for money borrowed the same analogy apply for interest for money borrowed the same analogy apply for interest for money borrowed purposes of capital asset , which in the case of the assessee is purposes of capital asset , which in the case of the assessee is purposes of capital asset , which in the case of the assessee is right in the flat. Thus following the decision of the Hon’ble flat. Thus following the decision of the Hon’ble flat. Thus following the decision of the Hon’ble Supreme Court (supra), the interest claimed as cost of Supreme Court (supra), the interest claimed as cost of Supreme Court (supra), the interest claimed as cost of acquisition is not allowable. acquisition is not allowable.

Shri Narendra Gehlaut ITA No. 1101/Mum/2022 6.5 Further we note that the loan sanction letter filed by the Further we note that the loan sanction letter filed by the Further we note that the loan sanction letter filed by the assessee is in respect of another flat i.e. C assessee is in respect of another flat i.e. C-2901 and not 2901 and not in respect of the flat in relation to which capital gain has been declared by the of the flat in relation to which capital gain has been declared by the of the flat in relation to which capital gain has been declared by the assessee. The clarification letter issued subsequently by the banker assessee. The clarification letter issued subsequently by the banker assessee. The clarification letter issued subsequently by the banker or financial institution does not seem to be part of a regular or financial institution does not seem to be part of a regular or financial institution does not seem to be part of a regular practice of the bank or financial institu practice of the bank or financial institution. In the case of the tion. In the case of the assessee the developer and the financial institution both being part assessee the developer and the financial institution both being part assessee the developer and the financial institution both being part of the same group, of which the assessee is part, otherwise in of the same group, of which the assessee is part, otherwise in of the same group, of which the assessee is part, otherwise in normal course no bank can give loan against the property which normal course no bank can give loan against the property which normal course no bank can give loan against the property which was not owned by the assessee and al was not owned by the assessee and also will not transfer loan so will not transfer loan against one property to another property without making changes against one property to another property without making changes against one property to another property without making changes in the loan sanction letter or issuing revised sanction letter. In the in the loan sanction letter or issuing revised sanction letter. In the in the loan sanction letter or issuing revised sanction letter. In the case, the documents produced do not give confidence of case, the documents produced do not give confidence of case, the documents produced do not give confidence of authenticity.

6.6 Accordingly, the find Accordingly, the finding of the Ld. CIT(A) on the issue in ing of the Ld. CIT(A) on the issue in dispute is set aside and finding that of the Assessing Officer is dispute is set aside and finding that of the Assessing Officer is dispute is set aside and finding that of the Assessing Officer is restored. The ground No. restored. The ground No. 1 & 2 of the appeal of the revenue 2 of the appeal of the revenue are accordingly allowed.

7. The ground No. 3 and 4 of the appeal The ground No. 3 and 4 of the appeal relate relate to addition of Rs.11,33,10,868/- treated by the Assessing Officer as unexplained treated by the Assessing Officer as unexplained treated by the Assessing Officer as unexplained investment u/s 69B of the Act. investment u/s 69B of the Act.

7.1 Brief fact qua the issue in dispute are that in the allotment Brief fact qua the issue in dispute are that in the allotment Brief fact qua the issue in dispute are that in the allotment letter dated 31.10.2015, available on Paper Book page 33, it is letter dated 31.10.2015, available on Paper Book page 33 letter dated 31.10.2015, available on Paper Book page 33

Shri Narendra Gehlaut ITA No. 1101/Mum/2022 mentioned that against the total con mentioned that against the total consideration amount of sideration amount of Rs.23,05,37,750/- of the right in the said flat of the right in the said flat, the developer already the developer already received Rs.22,86,49,013/ received Rs.22,86,49,013/- against booking of the flat whereas in against booking of the flat whereas in the computation of the capital gain the assessee has shown to have the computation of the capital gain the assessee has shown to have the computation of the capital gain the assessee has shown to have incurred amount of incurred amount of Rs.11,3310,868/-. Therefore, according to the Therefore, according to the Assessing Officer, the difference of Rs.11,53,38,145/ the difference of Rs.11,53,38,145/-, which was the difference of Rs.11,53,38,145/ part of purchase cost cost , but it was not recorded by the assessee in by the assessee in the books of accounts the books of accounts , therefore same was held as unexplained therefore same was held as unexplained investment by the Assessin investment by the Assessing Officer. The Ld. CIT(A) however deleted g Officer. The Ld. CIT(A) however deleted the addition observing as under: the addition observing as under:

“6.3.3 The AO has made addition of Rs. 11,53,38, 145/ The AO has made addition of Rs. 11,53,38, 145/- The AO has made addition of Rs. 11,53,38, 145/ us.69B in respect of unexplained us.69B in respect of unexplained investment on the basis of investment on the basis of amount of Rs.22,86,49,013/ amount of Rs.22,86,49,013/- mentioned in MOU dated mentioned in MOU dated 14.12.2016. 14.12.2016. During the appellate proceedings, appellant has During the appellate proceedings, appellant has submitted evidence of total payment of Rs.24,68,61,021/ submitted evidence of total payment of Rs.24,68,61,021/ submitted evidence of total payment of Rs.24,68,61,021/- made to M/s. Indiabull Infrastate Ltd in respect of purchase of made to M/s. Indiabull Infrastate Ltd in respect of purchase of made to M/s. Indiabull Infrastate Ltd in respect of purchase of flat. The source of such payment is loan taken from IICL and flat. The source of such payment is loan taken from IICL and flat. The source of such payment is loan taken from IICL and saving account of the appe saving account of the appellant. Thus, source of entire llant. Thus, source of entire payment for purchase of flat has been satisfactorily explained payment for purchase of flat has been satisfactorily explained payment for purchase of flat has been satisfactorily explained by the appellant. There by the appellant. Therefore, addition of Rs. 11,53,38, fore, addition of Rs. 11,53,38,145/- made by AO u/s.69B is deleted. made by AO u/s.69B is deleted.” 7.2 We have heard rival submission of the parties on the issue in We have heard rival submission of the parties on the issue in We have heard rival submission of the parties on the issue in dispute and perused perused the relevant material on record. Though the the relevant material on record. Though the Ld. CIT(A) has mentioned that the assessee has made payment of Ld. CIT(A) has mentioned that the assessee has made payment of Ld. CIT(A) has mentioned that the assessee has made payment of Rs.24,68,01,021/- to to ‘Indiabulls Infra Ltd’. in respect of purchases . in respect of purchases of the flat, however no such detail has been provided by the however no such detail has been provided by the however no such detail has been provided by the assessee before us. The assessee has only provided amount paid ssee before us. The assessee has only provided amount paid ssee before us. The assessee has only provided amount paid of Shri Narendra Gehlaut ITA No. 1101/Mum/2022 Rs. 11,33,10,868/- and claimed as part of the cost of acquisition and claimed as part of the cost of acquisition and claimed as part of the cost of acquisition detail of which is reproduced as under: detail of which is reproduced as under: Coat of acquisition Coat of acquisition Particulars Particulars Cost Indexed Cost Amount paid in FY 2013 Amount paid in FY 2013-14 662,55,210 793,79,245 Amount paid in FY 2014 Amount paid in FY 2014-15 470,55,658 516,96,890 1133,10,868 1310,76,135 Paid to developer Paid to developer Amount paid in FY 2015 Amount paid in FY 2015-16 (Interes 149,46,436 155,54,802 Amount paid in FY 2016 Amount paid in FY 2016-17 (Interes 169,81,840 169,81,840 319,28,276 325,36,642 Interest Cost Loan paid by ICCI to Developer Loan paid by ICCI to Developer 1837,86,057 1837,86,057 Loan repaid by the Buyer Loan repaid by the Buyer (1837,86,057) (1837,86,057) 1636,12,777 Total (A) 1452,39,144 7.2.1 The assessee also contended that loan amount of Rs. The assessee also contended that loan amount of Rs. The assessee also contended that loan amount of Rs. 18,37,86,057 was disbursed by the Financial Institution to the 18,37,86,057 was disbursed by the Financial Institution to the 18,37,86,057 was disbursed by the Financial Institution to the developer. If we take that amount into account, the amount paid by developer. If we take that amount into account, the amount paid by developer. If we take that amount into account, the amount paid by the assessee would exceed the total agreement value of the flat. The the assessee would exceed the total agreement value of the flat. The the assessee would exceed the total agreement value of the flat. The assessee while calculating sale consideration of Rs. 25,32,72,150/ see while calculating sale consideration of Rs. 25,32,72,150/ see while calculating sale consideration of Rs. 25,32,72,150/- mentioned that he has received refund of Rs. 11,32,72,150/- from mentioned that he has received refund of Rs. 11,32,72,150/ mentioned that he has received refund of Rs. 11,32,72,150/ the developer along with premium of Rs. 14,00,00,000/- received the developer along with premium of Rs. 14,00,00,000/ the developer along with premium of Rs. 14,00,00,000/ from the buyers/purchasers. When we take into all these amount from the buyers/purchasers. When we take into all these amount from the buyers/purchasers. When we take into all these amount we find that figure are not reconciling with claims made before the we find that figure are not reconciling with claims made before the we find that figure are not reconciling with claims made before the lower authorities for claim of payments towards property. In the lower authorities for claim of payments towards property. lower authorities for claim of payments towards property. circumstances, we do not have any alternative except to restore this circumstances, we do not have any alternative except to restore this circumstances, we do not have any alternative except to restore this issue back to the file of the Assessing Officer with issue back to the file of the Assessing Officer with a direction to the a direction to the assessee to produce all the documentary evidence in support of that to produce all the documentary evidence in support of that to produce all the documentary evidence in support of that payment of Rs.24,68,81,021/ payment of Rs.24,68,81,021/-, which was made by the assessee to was made by the assessee to Indiabulls Infra Estate Ltd. Indiabulls Infra Estate Ltd., alongwith ledger account of the alongwith ledger account of the Shri Narendra Gehlaut ITA No. 1101/Mum/2022 assessee appearing in the books of account assessee appearing in the books of account of developer and of developer and banker/financial institution. The Assessing officer is at liberty to banker/financial institution. The Assessing officer is at liberty to banker/financial institution. The Assessing officer is at liberty to make any inquiry required in the matter but required in the matter but shall provide opportunity of being heard to the assessee. of being heard to the assessee. The ground of appeal The ground of appeal of Revenue is accordingly allowed for statisti is accordingly allowed for statistical purposes. cal purposes.

8. The ground No. 5 of the appeal of the assessee relates to The ground No. 5 of the appeal of the assessee relates to The ground No. 5 of the appeal of the assessee relates to addition of Rs.13,88,037/ addition of Rs.13,88,037/- u/s 56(2)(vii) of the Act. A . According to the Assessing Officer against consideration of the flat i.e. agreement Assessing Officer against consideration of the flat Assessing Officer against consideration of the flat value ,which was to be paid by the assesse which was to be paid by the assessee to the developer a part e to the developer a part amount has only been paid and the amount has only been paid and the balance amount of balance amount of Rs.13,88,037/- has been has been neither shown to have paid nor shown to have paid nor shown as liability in its books of accounts and therefore immovable property liability in its books of accounts and therefore immovable property liability in its books of accounts and therefore immovable property has been received by the assessee for amount l has been received by the assessee for amount less than the market ess than the market value of the property value of the property ,thus, the difference was held to be deemed held to be deemed income in the hands of the assessee u/s 56(2)(vii) of the Act. income in the hands of the assessee u/s 56(2)(vii) of the Act. income in the hands of the assessee u/s 56(2)(vii) of the Act.

8.1 Before us, the Ld. Counsel of the assessee submitted that Before us, the Ld. Counsel of the assessee submitted that Before us, the Ld. Counsel of the assessee submitted that provision of section 56(2)( provision of section 56(2)(vii) of the Act are not applicable are not applicable to the facts of the present case facts of the present case because the assessee acquired assessee acquired the right in said property in financial year 2013 financial year 2013-14. He further submitted that 14. He further submitted that the assessee has not received any immovable property during the the assessee has not received any immovable property durin the assessee has not received any immovable property durin year under consideration, b year under consideration, but has later sold the rights pertaining to sold the rights pertaining to said unit during the previous year relevant to the financial year said unit during the previous year relevant to the financial year said unit during the previous year relevant to the financial year 2017-18. In view of the same addition u/s 56(2)(vii) of the Act is not 18. In view of the same addition u/s 56(2)(vii) of the Act is not 18. In view of the same addition u/s 56(2)(vii) of the Act is not applicable in the case of the assessee. applicable in the case of the assessee.

Shri Narendra Gehlaut ITA No. 1101/Mum/2022 8.2 We have heard rival submission of We have heard rival submission of the parties on the issue in the parties on the issue in dispute and perused the relevant material on record. The relevant dispute and perused the relevant material on record. The relevant dispute and perused the relevant material on record. The relevant provision of section 56(2)(vii) of the Act are reproduced as under: provision of section 56(2)(vii) of the Act are reproduced as under: provision of section 56(2)(vii) of the Act are reproduced as under:

“.. (vii) where an individual or a Hindu undivided family .. (vii) where an individual or a Hindu undivided family .. (vii) where an individual or a Hindu undivided family receives, in any previous year, from receives, in any previous year, from any person or persons on any person or persons on or after the 1st day of October, 2009 but before the 1st day of or after the 1st day of October, 2009 but before the 1st day of or after the 1st day of October, 2009 but before the 1st day of April, 2017,- - (b) any immovable property, (b) any immovable property,- (i) without consideration, the stamp duty value of which (i) without consideration, the stamp duty value of which (i) without consideration, the stamp duty value of which exceeds fifty thousand rupees, the stamp duty value of such exceeds fifty thousand rupees, the stamp duty value of such exceeds fifty thousand rupees, the stamp duty value of such property; (ii) for a consideration which is less than the stamp ty; (ii) for a consideration which is less than the stamp ty; (ii) for a consideration which is less than the stamp duty value of the property by an amount exceeding fifty duty value of the property by an amount exceeding fifty duty value of the property by an amount exceeding fifty thousand rupees, the stamp duty value of such property as thousand rupees, the stamp duty value of such property as thousand rupees, the stamp duty value of such property as exceeds such consideration: exceeds such consideration: Provided that where the date of the agreement fixing the Provided that where the date of the agreement fixing the Provided that where the date of the agreement fixing the amount of consideration for the transfer of immovable property amount of consideration for the transfer of immovable property amount of consideration for the transfer of immovable property and the date of registration are not the same, the stamp duty and the date of registration are not the same, the stamp duty and the date of registration are not the same, the stamp duty value on the date of the agreement may be taken for the value on the date of the agreement may be taken for the value on the date of the agreement may be taken for the purposes of this sub purposes of this sub-clause: Provided further that the said proviso shall Provided further that the said proviso shall apply only in a apply only in a case where the amount of consideration referred to therein, or case where the amount of consideration referred to therein, or case where the amount of consideration referred to therein, or a part thereof, has been paid by any mode other than cash on a part thereof, has been paid by any mode other than cash on a part thereof, has been paid by any mode other than cash on or before the date of the agreement for the trans or before the date of the agreement for the trans or before the date of the agreement for the transfer of such immovable property;” immovable property;” 8.2.1 On perusal of the above pro On perusal of the above provisions it is evident that visions it is evident that deemed income u/s 56(2)(vii) of the Act can be considered at the deemed income u/s 56(2)(vii) of the Act can be considered at the deemed income u/s 56(2)(vii) of the Act can be considered at the time of the receipt of the property in the hand of the assessee since time of the receipt of the property in the hand of the assessee since time of the receipt of the property in the hand of the assessee since in the year under consideration the property has not been received in the year under consideration the property has not been received in the year under consideration the property has not been received and therefore, provisions o and therefore, provisions of section 56(2)(vii) are not applicable in f section 56(2)(vii) are not applicable in the case of the assessee in the instant assessment year. The ground of the assessee in the instant assessment year. The ground of the assessee in the instant assessment year. The ground of the Revenue is accordingly dismissed. of the Revenue is accordingly dismissed.

Shri Narendra Gehlaut ITA No. 1101/Mum/2022

“7.3 The facts recorded in the assessment order and the 7.3 The facts recorded in the assessment order and the 7.3 The facts recorded in the assessment order and the submissions of the appellant have been carefully considered. submissions of the appellant have been carefully considered. submissions of the appellant have been carefully considered. During the appellant proceedings, the appellant had submitted During the appellant proceedings, the appellant had submitted During the appellant proceedings, the appellant had submitted copy of IT for copy of IT for A. Y.2016-17 and stated that cash in hand 17 and stated that cash in hand available was Rs.53,73.750/ available was Rs.53,73.750/- and the source of cash found of and the source of cash found of Rs.2,78,000/ Rs.2,78,000/- was the cash in hand available with the was the cash in hand available with the appellant. The appellant has been successful in explaining the appellant. The appellant has been successful in explaining the appellant. The appellant has been successful in explaining the source of cash of Rs.2,78,000/ source of cash of Rs.2,78,000/- as the part of cash in hand of cash in hand available with the appellant. In view of the above discussion, available with the appellant. In view of the above discussion, available with the appellant. In view of the above discussion, the addition of Rs.2,78.000/ the addition of Rs.2,78.000/- made u/s.69A by the appellant made u/s.69A by the appellant is deleted. Thus, Ground No.7 is allowed. Thus, Ground No.7 is allowed.” 9.1 We have heard rival submission of the parties on the issue in We have heard rival submission of the parties on the issue in We have heard rival submission of the parties on the issue in dispute and perused the relevant material on record. The Ld. DR dispute and perused the relevant material on record. The Ld. DR dispute and perused the relevant material on record. The Ld. DR could not controvert availability of cash in hand on more than could not controvert availability of cash in hand on more than could not controvert availability of cash in hand on more than Rs.53,00,000/- in the hands of the assessee which was supported in the hands of the assessee which was supported in the hands of the assessee which was supported by way of income way of income-tax return for assessment year 2016 tax return for assessment year 2016-17.

Shri Narendra Gehlaut ITA No. 1101/Mum/2022 Therefore, we do not find any error in the order of the Ld. CIT(A) on e do not find any error in the order of the Ld. CIT(A) on e do not find any error in the order of the Ld. CIT(A) on the issue in dispute and accordingly the issue in dispute and accordingly, we uphold the same. The we uphold the same. The ground of the Revenue is accordingly dismissed. ground of the Revenue is accordingly dismissed.