SMT. PADMINI RAMACHANDRAN,BANGALORE vs. ITO, BANGALORE

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ITA 1002/BANG/2014Status: DisposedITAT Bangalore30 July 2015AY 2006-0710 pages
AI SummaryPartly Allowed

What did the Tribunal hold?

The Tribunal held that the existence of the JDA was not disputed and the assessee was eligible to claim indexed cost of acquisition on the building sold based on it. However, the correct cost and indexation needed re-verification by the AO.

What were the facts?

The assessee claimed deduction under Section 54F for investment in a new house after selling a property. The Assessing Officer (AO) allowed a partial deduction, bringing the balance to tax as capital gains. The assessee argued that the cost of acquisition was incorrectly calculated, particularly concerning a Joint Development Agreement (JDA).

What were the issues?

Whether the indexed cost of acquisition, based on a JDA, was correctly computed and allowed for capital gains exemption. Whether the assessee was denied a fair opportunity to present her case before the lower authorities.

Which sections of the Income-tax Act were involved?

Section 54F,Section 144,Section 269L

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, BANGALORE BENCH C, BANGALORE

Before: SHRI. N. V. VASUDEVAN & SHRI. ABRAHAM P. GEORGE

For Appellant: Shri. S. Parthasarathi, Advocate

Heard together (2 matters)

ITA.1002/Bang/2014
SP.86/Bang/2015

Read from the judgment's own cause title. This page is filed under one of them.

per the assessee, the rate of Rs.803 sft was appropriate one, but this aspect requires verification. In our opinion, though assessee is eligible to claim indexed cost of acquisition on the building sold by her based on the JDA dt.01.03.1991, the issue of ascertaining the correct cost needs a relook. We, therefore, set aside the orders of the lower authorities in this regard and remit it back to the file of the AO for consideration afresh in accordance with law.

12.

Once indexed cost of building is computed, and when this is aggregated with the indexed cost of improvement of Rs.7,77,328/-, the capital gains that would arise might or might not be less than the deduction of Rs.8,80,000/- allowed by the AO himself. We are, therefore, of the opinion that the other issues raised by the assessee in relation to capital gains need not be adjudicated at this point of time. However, if the computation of capital gains done by the AO afresh in accordance with our directions result in capital gains in excess of Rs.8,80,000/-, assessee would be free to raise the grounds relating to its investments u/s.54F of the Act, done in the property. Grounds 1 to 7 of the assessee is treated as partly allowed.

13.

Vide ground 8, grievance of the assessee is that depreciation on computer is not allowed despite adequate proof being provided. We find that in its appeal before the CIT (A), assessee had raised altogether 8 grounds and in none of the grounds, the issue regarding depreciation on computer was raised. We are, therefore, of the opinion that this ground raised by the assessee does not arise ITA.1002/Bang/2014 & SP.86/Bang/2015 Page - 10 out of the order of the CIT (A). Ground 8 of the assessee, therefore, stands dismissed.

14.

Since the appeal itself on which the stay petition arises, has been disposed of as above, stay petition is dismissed as infructuous.

15.

In the result, appeal of the assessee is partly allowed for statistical purposes and the stay petition filed by the assessee is dismissed as infructuous.

Order pronounced in the open court on 30th day of July, 2015.

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