SANNIDHI SRI RAMACHANDRA MURTHY (HUF),RAJAHMUNDRY vs. ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE-1, RAJAHMUNDRY

ITA 230/VIZ/2024Status: DisposedITAT Visakhapatnam25 September 2024AY 2013-14Bench: SHRI DUVVURU RL REDDY, HON’BLE (Judicial Member), SHRI S BALAKRISHNAN, HON’BLE (Accountant Member)11 pages
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What did the Tribunal hold?

The Tribunal held that capital gains on conversion of capital asset to stock-in-trade are taxable in the year of sale of stock-in-trade. Consequently, investments for claiming deductions under sections 54B and 54F should be considered from the date of sale of stock-in-trade.

What were the facts?

The assessee converted agricultural land into stock-in-trade in 2010 and sold it in FY 2012-13. The assessee claimed exemptions under sections 54B and 54F based on investments made after the sale of stock-in-trade. The Principal Commissioner of Income Tax invoked Section 263, considering the assessment order erroneous and prejudicial to revenue.

What were the issues?

Whether the date of conversion of capital asset to stock-in-trade or the date of sale of stock-in-trade is relevant for computing capital gains and claiming exemptions under sections 54B and 54F.

Which sections of the Income-tax Act were involved?

Section 45(2),Section 54B,Section 54F,Section 263

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Income Tax Appellate Tribunal, VISAKHAPATNAM BENCH, VISAKHAPATNAM

Before: SHRI DUVVURU RL REDDY, HON’BLE & SHRI S BALAKRISHNAN, HON’BLE

For Appellant: Shri GVN Hari, AR
For Respondent: Dr. Satyasaai Rath, CIT(DR)
Pronounced: 25.09.2024

PER SHRI S BALAKRISHNAN, ACCOUNTANT MEMBER:

1.

This appeal is filed by the assessee against proceedings of Learned Principal Commissioner of Income Tax, Visakhapatnam – 1 [herein

The order continues below.

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