L. Vivekananda, Mysore V. The Assistant Commissioner of Income Tax Circle-1(1), Mysore

ITA 1087/BANG/2018

• Counselvise Citation: [2020] 110 COUNSELVISE.COM (IT) 3289 (ITAT-BANGALORE)
• Duration Of Justice: 2 year(s) 7 month(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-11-2020
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: C
• Next Hearing Date: 17-11-2020
• Assessment Year: 2013-2014
• Appeal Filed On: 04-04-2018
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: R PREMI
• Assessee Lawyers: G N BHAT
• Keywords: Capital asset; Rule of consistency; Cost of acquisition; Set aside; Capital Gains; FORM 26AS
• Section: 2(14); 260A; 48; 13

Judgement Text

ITA NO.1087/BANG/2018 SHRI L. VIVEKANANDA, MYSORE IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH: BANGALORE BEFORE SHRI CHANDRA POOJARI, ACCOUNTANT MEMBER AND SMT. BEENA PILLAI, JUDICIAL MEMBER ITA NO.1087/BANG/2018 ASSESSMENT YEAR: 2013-14 SHRI L. VIVEKANANDA M/S. VIVEK HOTELS, 1294/1-B J.L.B. ROAD MYSURU-570 005 PAN NO : AASPV6693A VS. ACIT CIRCLE-1(1), RESIDENCY ROAD NAZARBAD MYSURU-570 010 APPELLANT RESPONDENT APPELLANT BY : SHRI G.N. BHAT, A.R. RESPONDENT BY : SMT. R. PREMI, D.R. DATE OF HEARING : 17.11.2020 DATE OF PRONOUNCEMENT : 18.11.2020 O R D E R PER CHANDRA POOJARI, ACCOUNTANT MEMBER: THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST OR DER OF THE CIT(A) DATED 31.10.2017. THE ASSESSEE HAS R AISED FOLLOWING GROUNDS OF APPEAL: 1. THE ORDER OF THE CIT(APPEALS). IN SO FAR AS IT IS PREJUDICIAL TO THE APPELLANT, IS OPPOSED TO LAW, PROBABILITIES, WEIGHT OF EVIDENCES, AND FACTS AND CIRCUMSTANCES OF THE CASE. 2 THE LEARNED CIT(APPEALS) ERRED IN NOT RECOGNISING THAT THE APPELLANT ACQUIRED THE RIGHT IN THE ASSET AT NO.S-4 , SIDDARTHA LAYOUT, NAZARBAD MOHALLA, MYSORE IN THE FINANCIAL Y EAR 1986- 87 WHEN THE ALLOTMENT LETTER WAS ISSUED BY MYSORE U RBAN DEVELOPMENT AUTHORITY AND HE MADE THE FULL PAYMENT TOWARDS ITA NO.1087/BANG/2018 SHRI L. VIVEKANANDA, MYSORE PAGE 2 OF 18 THE COST OF THE ASSET AND BECAME ENTITLED TO TAKE T HE INFLATED COST OF ACQUISITION OF THE FINANCIAL YEAR 1986-87 W HILE WORKING OUT THE CAPITAL GAIN ARISING FROM THE TRANS FER OF THAT ASSET. 3. THE LEARNED CIT(APPEALS) FAILED TO APPRECIATE THAT THE APPELLANT 'HELD - THE PROPERTY IN QUESTION RIGHT FROM THE DATE OF PAYMENTS AND NO COST WAS PAID LATER TO MUDA, WHI CH ALLOTTED THE SITE IN FAVOUR OF THE APPELLANT, AND T HESE FACTS ESTABLISH THAT THE PROPERTY WAS ACQUIRED IN THE FIN ANCIAL YEAR 1986-87 ITSELF. 4. THE LEARNED CIT(APPEALS) ERRED IN NOT CONSIDERING T HE DECISIONS OF VARIOUS HIGH COURTS, INCLUDING THE JUR ISDICTIONAL HIGH COURT AND ORDERS OF ITATS RELIED UPON BY THE A PPELLANT DURING THE APPEAL PROCEEDINGS. WHICH SQUARELY APPLY TO THE FACTS OF THE APPELLANT'S CASE. 5.. THE LEARNED CIT(APPEALS) ERRED IN NOT ALLOWING THE INFLATED, COST OF IMPROVEMENT ON THE CONSTRUCTION OF A BUILDING AT A COST OF RS.3,00,000 AS CLAIMED BY THE APPELLANT BEFORE THE ASSESSING OFFICER. 6. THE LEARNED CIT(APPEALS) ERRED IN NOT NOTICING T HAT THE APPELLANT HAD OFFERED INCOME FROM HOUSE PROPERTY IN RESPECT O F THE STRUCTURE EXISTING ON THE LAND FOR MANY YEARS AND HAD SHOWN T HE PROPERTY IN THE WEALTH TAX RETURN ALSO, WHICH ALL CORROBORATE THE FACT THAT IMPROVEMENT WAS EFFECTED IN CONSTRUCTION OF A BUILD ING. 7. THE LEARNED CIT(APPEALS) ERRED IN NOT SPECIFICALLY DEALING WITH THIS GROUND OF APPEAL AND THERE IS NO DISCUSSION IN HIS APPELLATE ORDER ABOUT THE CLAIM OF THE APPEL LANT. 8. WITHOUT PREJUDICE TO THE RIGHT OF THE APPELLANT TO APPROACH THE ASSESSING OFFICER TO GIVE CREDIT FOR T CS AS PER 26AS AS DIRECTED BY THE CIT(APPEALS) IN HIS ORDER, IT IS SUBMITTED THAT THE CIT(APPEALS) OUGHT TO HAVE SPECI FICALLY DIRECTED THE ASSESSING OFFICER TO GIVE CREDIT FOR T CS OF RS.18,165/- AS CLAIMED IN THE RETURN WHILE COMPUTIN G THE TAX LIABILITY. 9. THE APPELLANT CRAVES LEAVE TO ADD, DELETE, SUBSTITU TE ANY OF THE GROUNDS BEFORE THE HEARING OF APPEAL. 10. THE APPELLANT, THEREFORE, PRAYS THAT THE ITAT MAY B E PLEASED TO SET ASIDE THE ORDER OF CIT(APPEALS), DEL ETE THE ADDITIONS MADE IN THE ORDER OF ASSESSMENT, DIRECT T HE ASSESSING ITA NO.1087/BANG/2018 SHRI L. VIVEKANANDA, MYSORE PAGE 3 OF 18 OFFICER TO ACCEPT THE INCOME RETURNED AND GIVE CRED IT FOR TCS AS CLAIMED IN THE RETURN OF INCOME, IN THE INTEREST OF JUSTICE. 2. THE FACTS OF THE CASE ARE THAT THE APPELLANT WAS AL LOTTED A SITE BEARING NO. S-4, SIDDHARTHA LAYOUT, MYSURU O N 20.5.1986 BY THE THEN MYSORE CITY IMPROVEMENT TRUST BOARD MEASURING 3095.50 SQ.YARDS FOR A CONSIDERATIO N OF RS.3,34,314/-, WITH A CONDITION THAT THE CONSIDERAT ION SHOULD BE PAID WITHIN 15 DAYS FROM THE DATE OF RECE IPT OF THAT ALLOTMENT LETTER DATED 20.5.1986. FROM THE ALL OTMENT LETTER IT IS EVIDENT THAT THE ALLOTMENT WAS DONE PU RSUANT TO A PETITION MADE BY THE APPELLANT TO THE CHIEF MI NISTER OF THE GOVERNMENT OF KARNATAKA. ACCORDINGLY, THE APPELLANT PAID THE CONSIDERATION BY WAY OF TWO DEMA ND DRAFTS DATED: 29.5.1986 VIDE DD NO. 921565 AND 8972 47 RESPECTIVELY FOR RS.100,000/- AND RS.2,34,314/-, TH E RECEIPT OF WHICH HAS BEEN ACKNOWLEDGED BY THE THEN MYSORE CITY IMPROVEMENT TRUST BOARD. THUS, THE ENTI RE CONSIDERATION WAS PAID ON 29.5.1986 AS PER THE TERM S OF ALLOTMENT. IT IS CLARIFIED THAT THE ERSTWHILE CITY IMPROVEMENT TRUST BOARD WAS RE-NAMED AS MYSURU CITY IMPROVEMENT TRUST BOARD. PURSUANT TO THE PAYMENT MADE, THE MYSURU DEVELOPMENT AUTHORITY (MUDA FOR SHORT) EXECUTED AN AGREEMENT ON 16.6.1998 VIDE REGN . NO.1482, VOLUME NO.1692, PP 33-36 OF BOOK NO.1 DATE D: 18.6.1998. IN THE AGREEMENT, A MENTION HAS BEEN MAD E ABOUT THE ALLOTMENT OF THE SITE TO THE APPELLANT ON 20.5.1986 AND THE SAME HAS BEEN CONFIRMED BY THE AUTHORITY ON 11.9.1986 HAS ALSO BEEN MENTIONED. THE RELEVANT CLAUSE OF THE AGREEMENT READS AS FOLLOWS: ITA NO.1087/BANG/2018 SHRI L. VIVEKANANDA, MYSORE PAGE 4 OF 18 'WHEREAS THE FIRST PARTY HAS PURCHASED THE SITE DESCRIBED INT HE SCHEDULE FOR A SUM OF RS. 3,34,314/-(RUPEES THREE LAKH THIRTY FOUR THOUSAND THREE HUNDRED FOURTEEN ONLY) AS PER ALLOTMENT ORDER DATED: 20-5-1986, AND THE SAME HAS BEEN CONFIRMED BY THE AUTHORITY ON 11.9.1986. ON CONFIRMATION THE FIRST PARTY, HAS PAID THE FULL COST OF THE SCHEDULE SITE ON 29.6.1986.' 3. A POSSESSION CERTIFICATE WAS ISSUED ON 23.6.199 8. LATER, THE MUDA HAS EXECUTED A DEED ON 6 1 H JANUARY, 2004 CONFERRING THE TITLE ON THE SITE TO THE APPELLANT. THE PROPERTY HELD BY THE APPELLANT FROM THE DATE OF ALLOTMENT WA S SOLD BY HIM ON 9.5.2012 IN FAVOUR OF ONE SRI PARASMAL DAK. SIGNIFICANTLY, THE SALE DEED AT PAGE 2 CLEARLY MENT IONS ABOUT THE ALLOTMENT LETTER DATED: 20.5.1986. THE CLAIM OF THE APPELLANT IS, THAT SINCE THE ENTIRE CONSIDERATION W AS PAID TO MUDA AS PER THE LETTER OF ALLOTMENT, AND AN AGREEME NT HAS ALSO BEEN ENTERED INTO ON 19.6.1998, CONFIRMING THE PURCHASE OF THE SITE BY THE APPELLANT BY ALLOTMENT LETTER DATED:20.5.1986, THE APPELLANT BECAME ENTITLED FOR THE OWNERSHIP OF THE PROPERTY. THE APPELLANT 'HELD' THE PROPERTY FOR ALL PRACTICAL PURPOSES ON DE FACTO BASIS FROM T HE DATE OF LETTER OF ALLOTMENT AND THE PAYMENT OF THE TOTAL CO NSIDERATION, MORE PARTICULARLY IN VIEW OF THE FACT THAT THE ALLO TMENT LETTER IDENTIFIED THE PROPERTY AND THE ENTIRE CONSIDERATIO N WAS ALSO PAID DURING THE FINANCIAL YEAR 1986-87. FOR THE PUR POSE OF EASY REFERENCE, THE CHRONOLOGY OF EVENTS IS GIVEN B ELOW: ITA NO.1087/BANG/2018 SHRI L. VIVEKANANDA, MYSORE PAGE 5 OF 18 1. DATE OF APPLICATION 2. DATE OF ALLOTMENT LETTER ALLOTTING SITE NO.S- 4, SIDDHARTHA LAYOUT, MYSURU 3. DATE OF PAYMENT OF ENTIRE CONSIDERATION 4. DATE OF EXECUTION OF AGREEMENT 5. DATE OF POSSESSION CERTIFICATE 6. DATE OF EXECUTION OF DEED CONFERRING TITLE 7. DATE OF SALE OF THE SITE BY THE APPELLANT 0 3. 0 5.1986 20.05.1986 29.05.1986 16.06.1998 23.06.1998 06.01.2004 09.05.2012 4. THE APPELLANT JUSTIFIED HIS CLAIM THAT HE IS ENT ITLED TO COST INFLATION FROM THE FINANCIAL YEAR 1986-87 AS N OT GETTING POSSESSION CERTIFICATE OF THE SITE IN QUESTION AT T HE TIME OF ALLOTMENT ON 20.5.1986 DID NOT DETRACT FROM THE OWN ERSHIP OF THE PROPERTY IN QUESTION. THE ASSESSING OFFICER, ON THE OTHER HAND, HAS TAKEN THE DATE OF GRANT OF POSSESSION CER TIFICATE VIZ., 23.6.1998 AND CALCULATED THE COST INFLATION FROM TH E FINANCIAL YEAR 1998-99 ONLY. AS A RESULT OF SUCH ADOPTION, TH E COST OF ACQUISITION WAS WORKED AT RS. 8,11,497 BY THE ASSES SING OFFICER, AS AGAINST RS. 20,34,539/- ADOPTED BY THE APPELLANT , RESULTING IN AN ADDITION OF RS. 12,23,042/-. 5. THE ASSESSEE WENT IN APPEAL BEFORE CIT(A) AND TH E LD. CIT(A) CONFIRMED THE ORDER OF THE A.O. AGAINT THI S, THE ASSESSEE IS IN APPEAL BEFORE US. THE LD. A.R. SUBMITTED THA T AS PER THE DEFINITION OF THE TERM 'SHORT TERM CAPITAL ASSET' I N SECTION 2(42A), A CAPITAL ASSET HELD BY AN ASSESSEE FOR NOT MORE THAN THIRTY-SIX MONTHS IMMEDIATELY PRECEDING THE DATE OF ITS TRANSFER IS A SHORT TERM CAPITAL ASSET. SECTION 2(2 9A) DEFINES 'LONG TERM CAPITAL ASSET' MEANS A CAPITAL ASSET WHI CH IS NOT A SHORT TERM CAPITAL ASSET. FOR THE PURPOSE OF DETERM INING THE ITA NO.1087/BANG/2018 SHRI L. VIVEKANANDA, MYSORE PAGE 6 OF 18 NATURE OF CAPITAL GAIN, THE LEGISLATURE WAS CONCERN ED WITH THE PERIOD DURING WHICH THE ASSET WAS HELD BY THE ASSES SEE FOR ALL PRACTICAL PURPOSES ON DE FACTO BASIS. THE LEGISLATU RE WAS APPARENTLY NOT CONCERNED WITH ABSOLUTE LEGAL OWNERS HIP OF THE ASSET FOR DETERMINING THE HOLDING PERIOD. THE ALLOT TEE GETS TITLE OF THE PROPERTY ON THE ISSUANCE OF ALLOTMENT LETTER AND FULL PAYMENT OF COST OF THE SITE. THE ISSUANCE POSSESSIO N CERTIFICATE IS ONLY A CONSEQUENTIAL ACTION UPON WHICH DELIVERY OF POSSESSION FLOWS. THEREFORE, THE DATE OF ALLOTMENT LETTER AND PAYMENT OF CONSIDERATION VIZ., 29.5.1986 IS THE YEA R OF ACQUISITION FOR THE PURPOSE OF CALCULATION OF INFLATED COST OF ACQUISITION. FURTHER, HE DREW OUR ATTENTION TO THE EXPLANATION (III) TO S . 48 WHICH ENTITLES THE ASSESSEE TO THE INDEXATION BENEFIT AND ALSO TO EXPLANATION (III) TO S. 48 REFERS TO THE WORDS 'THE ASSET'. IT MEANS SOME CAPITAL ASSET WHICH IS SUBJECT-MATTER OF SALE ON WHICH LONG-TERM CAPITAL GAIN IS TO BE COMPUTED. 6. THUS, GOING INTO THE PROVISIONS, IT IS NOT NECES SARY THAT TO CONSTITUTE A CAPITAL ASSET THE APPELLANT MUST BE TH E OWNER BY WAY OF A CONVEYANCE DEED IN RESPECT OF THAT ASSET FOR T HE PURPOSE OF COMPUTING CAPITAL GAIN. THE APPELLANT HAD ACQUIRED A RIGHT TO GET A PARTICULAR SITE FROM MUDA AND THAT RIGHT OF THE ASS ESSEE ITSELF IS A CAPITAL ASSET. THE WORD 'HELD' USED IN S. 2(14) AS WELL AS EXPLANATION TO S. 48 CLEARLY EXPLAINS THAT APPELLANT HAD SOME R IGHT IN THE CAPITAL ASSET WHICH IS SUBJECTED TO TRANSFER. BY MAKING THE PAYMENT TO MUDA PURSUANT TO THE ALLOTMENT LETTER, THE APPELLAN T HELD THE CAPITAL ASSET AND, THEREFORE, THE BENEFIT OF INDEXA TION HAS TO BE GRANTED TO THE APPELLANT ON THE BASIS OF PAYMENTS M ADE BY HIM FOR ACQUIRING THE SAID ASSET AND THE APPELLANT HAS RIGH TLY CLAIMED THE INDEXATION BENEFIT FROM THE DATES WHEN HE HAS MADE THE ITA NO.1087/BANG/2018 SHRI L. VIVEKANANDA, MYSORE PAGE 7 OF 18 PAYMENTS TO MUDA. AS A MATTER OF FACT, MUDA ON 1.1. 1988 ISSUED A SHOW CAUSE NOTICE TO THE APPELLANT TO SHOW CAUSE WHY THE ALLOTMENT OF THE SITE MADE BY THE THEN CITY IMP ROVEMENT TRUST BOARD SHOULD NOT BE CANCELLED. THE APPELLANT SATISFACTORILY REPLIED THE AUTHORITIES AND SUCH A P ROPOSAL TO CANCEL THE ALLOTMENT WAS WITHDRAWN. THIS SHOW CAUSE NOTICE PROVES THAT THE OPPORTUNITY WAS GIVEN, AS THE APPEL LANT HAD ACQUIRED A VESTED RIGHT BY VIRTUE OF ALLOTMENT LETT ER. THE DECISION RELIED UPON BY THE CIT(APPEALS) IN THE CAS E OF BALBIR SINGH MAINI HAS NO APPLICATION TO THE FACTS OF THE APPELLANT'S CASE AT ALL. THE HON'BLE SUPREME COURT IN THAT CASE WAS CONCERNED WITH TAXABILITY OF CAPITAL GAIN ON ENTERI NG INTO A JOINT DEVELOPMENT AGREEMENT. THE QUESTIONS FRAMED B Y THE HON'BLE SUPREME COURT IN THE CASE ARE EXTRACTED BEL OW: 'THE PRESENT APPEALS ARISE FROM A JUDGMENT OF THE P UNJAB AND HARYANA HIGH COURT WHERE A LARGE NUMBER OF APPEALS WERE DISPOSED OF UNDER SECTION 260A OF THE INCOME TAX ACT, 1961. THE FOLLOWING SUBSTANTIAL QUESTIONS OF LAW WERE RAISED BEFORE THE HIGH COURT: I) WHETHER THE TRANSACTIONS IN HAND ENVISAGE A 'TRANSFER' EXIGIBLE TO TAX BY REFERENCE TO SECTION 2(47)(V) OF THE INCOME TAX ACT, 1961 READ WITH SECTION 53-A OF THE TRANSFER OF PROPERTY ACT, 1882? II) WHETHER THE INCOME TAX APPELLATE TRIBUNAL, HAS IGNORED RIGHTS EMANATING FROM THE JDA, LEGAL EFFECT OF NON REGISTRATION OF JDA, ITS ALLEGED REPUDIATION ET C.? ITA NO.1087/BANG/2018 SHRI L. VIVEKANANDA, MYSORE PAGE 8 OF 18 III) WHETHER 'POSSESSION' AS ENVISAGED BY SECTION 2(47)(V) AND SECTION 53-A OF THE TRANSFER OF PROPER TY ACT, 1982 WAS DELIVERED, AND IF SO, ITS NATURE AND LEGAL EFFECT? IV) WHETHER THERE WAS ANY DEFAULT ON THE PAD OF THE DEVELOPERS, AND IF SO, ITS EFFECT ON THE TRANSACTIO NS AND ON EXIGIBILITY TO TAX? V) WHETHER AMOUNT YET TO BE RECEIVED CAN BE TAXED ON A HYPOTHETICAL ASSUMPTION ARISING FROM THE AMOUNT TO BE RECEIVED?' 7. THE JUDGEMENT RELIED UPON BY THE CIT(A) IN THE C ASE OF CIT VS. BALBIR SINGH MAINI IN CIVIL APPEAL NO.15619 OF 2017 IS NOT APPLICABLE TO THE FACTS OF THE CASE. HE RELIED ON THE FOLLOWING JUDGEMENTS:- I. ANITA D. KANJANI VS. ACIT (2017) 49 CCH 0043 MUM TR IB. II. PRAVEEN GUPTA VS. ACIT ITAT, DELHI F BENCH (2011) 137 TTJ 0307 III. CIT VS. S.R. JEYASHANKAR HIGH COURT OF MADRAS (2015 ) 373 ITR 0120 IV. MADHU KAUL VS. CIT AND ANOTHER HIGH COURT OF PUNJAB & HARYANA (2014) 363 ITR 0054(P&H). V. CIT-III VS. A. SURESH RAO HIGH COURT OF KARNATAKA ( 2014) 223 TAXMAN 0228 (KARNATAKA). VI. CIT VS. VED PRAKASH RAKHRA HIGH COURT OF KARNATAKA (2015) 370 ITR 0762 (KARN). VII. VINOD KUMAR JAIN VS. CIT & ORS. HIGH COURT OF PUNJA B & HARYANA (2012) 344 ITR 0501. VIII. PRADEEP KAR VS. ACIT ITA 596/BANG/2014 DATED 11.5.2 016 IX. ITO VS. R. SATHYANARAYANA HIGH COURT OF KARNATAKA ( ITA 25 OF 2001 DATED 17.12.2007). ITA NO.1087/BANG/2018 SHRI L. VIVEKANANDA, MYSORE PAGE 9 OF 18 X. CIT VS. B.K. SAROJA (HIGH COURT OF KARNATAKA) ITA N O.328 OF 2003 DATED 13.12.2007. 8. HE ALSO RELIED ON THE CBDT CIRCULAR NO.471 DATED 15.10.1986. 9. ON THE OTHER HAND, LD. D.R. SUBMITTED THAT DATE OF ACQUISITION OF IMMOVABLE PROPERTY FOR THE PURPOSE O F COMPUTATION OF COST OF INFLATION OF INDEXATION TO BE THE DATE C ONSIDERED ON WHICH THE ASSESSEE GOT ABSOLUTE SALE DEED IN HIS FAVOUR. ACCORDING TO THE LD. D.R., THE SALE DEED BY MYSORE URBAN DEVELOPMENT AUTHORITY (MUDA) WAS EXECUTED IN FAVOUR OF THE ASSESSEE ON 6. 1.2004. ACCORDING TO THE LD. D.R., DATE OF GRANTING OF POSS ESSION CERTIFICATE I.E. 23.6.1998 TO BE CONSIDERED FOR THE PURPOSE OF COMPUTING THE INDEXATION COST OF THE ASSET AND WHICH IS RELATED T O A.Y. 1998-99. ACCORDING TO THE LD. D.R., ALLOTMENT LETTER DID NOT CONFER ANY RIGHT TO ACQUIRE A PROPERTY BY THE ASSESSEE AND ONLY CREA TED AN INTEREST TO ACQUIRE THE SAME, SUBJECT TO TERMS & CONDITIONS AS WOULD BE LAID DOWN IN THE AGREEMENT TO BE ENTERED TO PURCHASE THE SAID PROPERTY. 10. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIALS AVAILABLE ON RECORD AND GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW. IN THE PRESENT CASE, ASSESSEE GOT ALLOTMENT LETTER FOR SITE NO.S-4, SIDDHARTH LAYOUT, MYSORE ON 20.5.1 986. PAYMENT OF CONSIDERATION WAS PAID BY ASSESSEE BY 29.5.1986 AND THE POSSESSION CERTIFICATE ISSUED BY THE AUTHORITIES ON 23.6.1998. THE SALE DEED WAS EXECUTED BY MUDA IN FAVOUR OF THE ASS ESSEE ON 6.1.2004. THE SAID PROPERTY WAS SOLD BY ASSESSEE O N 9.5.2012. THE ASSESSEES CONTENTION IS THAT FOR THE PURPOSE OF CO MPUTATION OF CAPITAL GAIN, INDEXATION COST OF ACQUISITION TO BE MADE FROM THE DATE ITA NO.1087/BANG/2018 SHRI L. VIVEKANANDA, MYSORE PAGE 10 OF 18 OF ALLOTMENT OF THE SITE I.E. 20.5.1986. CONTRARY TO THIS, A.O. CONSIDERED DATE OF GRANT OF POSSESSION CERTIFICATE AS 23.6.1998 TO DETERMINE THE COST OF INFLATION INDEXATION SO AS TO COMPUTE THE CAPITAL GAINS. NOW, THE ISSUE BEFORE US IS WHETHER THE DATE OF ALLOTMENT OF SITE OR DATE OF ISSUE OF POSSESSION CE RTIFICATE TO BE CONSIDERED TO DETERMINE THE COST OF INFLATION INDEX ATION. THE HONBLE KARNATAKA HIGH COURT IN THE CASE OF CIT VS. A. SURESH RAO 223 TAXMAN 228 (KARN) HAS ANALYSED AND EXPLAINED AT LENGTH. HONBLE HIGH COURT ANALYSED VARIOUS PROVISIONS OF T HE ACT PERTAINING TO COMPUTATION OF CAPITAL GAIN UNDER VAR IOUS SITUATIONS AND ALSO CIRCULARS ISSUED BY THE CBDT ON THIS ISSUE . RELEVANT PORTION OF THE OBSERVATION WHEREIN THE ISSUE BEFORE US HAS BEEN PROPERLY ANALYSED IS REPRODUCED HEREUNDER: 'THE DEFINITION AS CONTAINED IN SECTION 2 (42A) OF THE ACT, THOUGH USES THE WORDS, 'A CAPITAL ASSET HELD AN ASSESSEE F OR NOT MORE THAN THIRTY-SIX MONTHS IMMEDIATELY PRECEDING THE DATE OF ITS TRANSFER', FOR THE PURPOSE OF HOLDING AN ASSET, IT IS NOT NECESSARY THAT, HE SHOULD BE THE OWNER OF THE ASSET, WITH A REGISTERED DEED O F CONVEYANCE CONFERRING TITLE ON HIM. IN THE LIGHT OF THE EXPANDED DEFINITION AS CONTAINED IN SECTION 2(47), EVEN WHEN A SALE, EXCHA NGE, OR RELINQUISHMENT OR EXTINGUISHMENT OF ANY RIGHT, UNDE R A TRANSACTION THE ASSESSEE IS PUT IN POSSESSION OF AN IMMOVABLE P ROPERTY OR HE RETAINED THE SAME IN PART PERFORMANCE OF THE CONTRA CT UNDER SECTION 53-A OF THE TRANSFER OF PROPERTY ACT, IT AMOUNTS TO TRANSFER. NO REGISTERED DEED OF SALE IS REQUIRED TO CONSTITUTE A TRANSFER. SIMILARLY, ANY TRANSACTION WHETHER BY WAY OF BECOMING A MEMBER OF OR ACQUIRING SHARES IN A CO-OPERATIVE SOCIETY, COMPANY OR OTHER ASSOCIATION OF PERSONS OR BY WAY OF ANY AGREEMENT O R ANY ARRANGEMENT OR IN ANY OTHER MANNER WHATSOEVER, WHIC H HAS THE EFFECT OF TRANSFERRING, OR ENABLING THE ENJOYMENT O F ANY IMMOVABLE PROPERTY, ALSO CONSTITUTES TRANSFER AND THE ASSESSE E IS SAID TO HOLD THE SAID PROPERTY FOR THE PURPOSE OF THE DEFINITION OF 'SHORT-TERM CAPITAL GAIN'. IN FACT, THE CIRCULAR NO.495 MAKES I T CLEAR THAT TRANSACTIONS OF THE NATURE REFERRED TO ABOVE ARE NO T REQUIRED TO BE REGISTERED UNDER THE REGISTRATION ACT, 1908. SUCH A RRANGEMENTS CONFER THE PRIVILEGES OF OWNERSHIP WITHOUT TRANSFER OF TITLE IN THE ITA NO.1087/BANG/2018 SHRI L. VIVEKANANDA, MYSORE PAGE 11 OF 18 BUILDING AND ARE COMMON MODE OF ACQUIRING FLATS PAR TICULARLY IN MULTISTORIED CONSTRUCTIONS IN BIG CITIES. THE AFORE SAID NEW SUB- CLAUSES (V) AND (VI) HAVE BEEN INSERTED IN SECTION 2(47) TO PREVENT AVOIDANCE OF CAPITAL GAINS LIABILITY BY RECOURSE TO TRANSFER OF RIGHTS IN THE MANNER REFERRED TO ABOVE. A PERSON HOLDING T HE POWER OF ATTORNEY IS AUTHORIZED THE POWERS OF OWNER, INCLUDI NG THAT OF MAKING CONSTRUCTION THOUGH THE LEGAL OWNERSHIP IN S UCH CASES CONTINUES TO BE WITH THE TRANSFEROR. THE INTENTION OF LEGISLATURE IS TO TREAT EVEN SUCH TRANSACTIONS AS TRANSFERS AND THE C APITAL GAIN ARISING OUT OF SUCH TRANSACTIONS ARE BROUGHT TO TAX . FURTHER, THE CIRCULAR NO.4 71 GOES TO THE EXTENT OF CLARIFYING T HAT FOR THE PURPOSE OF INCOME-TAX ACT, THE ALLOTTEE GETS TITLE TO THE P ROPERTY ON THE ISSUANCE OF THE ALLOTMENT LETTER AND THE PAYMENT OF INSTALLMENTS IS ONLY A FOLLOW UP ACTION AND TAKING THE DELIVERY OF POSSESSION IS ONLY A FORMALITY. IN CASE OF CONSTRUCTION AGREEMENTS, TH E TENTATIVE COST OF CONSTRUCTION IS ALREADY DETERMINED AND THE AGREEMEN T PROVIDES FOR PAYMENT OF COST OF CONSTRUCTION IN INSTALLMENTS SUB JECT TO THE CONDITION THAT THE ALLOTTEE HAS TO BEAR THE INCREAS E, IF ANY, IN THE COST OF CONSTRUCTION. THEREFORE, FOR THE PURPOSE OF CAPI TAL GAINS TAX THE COST OF THE NEW ASSET IS THE TENTATIVE COST OF CONS TRUCTION AND THE FACT THAT THE AMOUNT WAS ALLOWED TO BE PAID IN INSTALLME NTS DOES NOT AFFECT THE LEGAL POSITION. THEREFORE, IN CONSTRUING SUCH T AXATION PROVISIONS, WHAT SHOULD BE THE APPROACH OF THE COURTS AND THE I NTERPRETATION TO BE PLACED IS CLEARLY SET OUT BY THE APEX COURT IN T HE CASE OF SMT. SAROJ AGGARWAL VS CIT 156 ITR 497 WHEREIN IT IS HEL D AS UNDER:- 'FACTS SHOULD BE VIEWED IN NATURAL PERSPECTIVE, HAV ING REGARD TO THE COMPULSION OF THE CIRCUMSTANCES OF A CASE. WHERE IT IS POSSIBLE TO DRAW TWO INFERENCES FROM THE FACTS AND WHERE THERE IS NO EVIDENCE OF ANY DISHONEST OR IMPROPER MOTIVE ON THE PART OF THE ASSESSEE, IT WOULD BE JUST AND EQUITABLE TO DRAW SUCH INFERENCE IN SUC H A MANNER THAT WOULD LEAD TO EQUITY AND JUSTICE. TOO HYPER-TECHNIC AL OR LEGALISTIC APPROACH SHOULD BE AVOIDED IN LOOKING AT A PROVISIO N WHICH MUST BE EQUITABLY INTERPRETED AND JUSTLY ADMINISTERED COURT S SHOULD, WHENEVER POSSIBLE UNLESS PREVENTED BY THE EXPRESS L ANGUAGE BY ANY SECTION OR COMPELLING CIRCUMSTANCES OF ANY PARTICUL AR CASE, MAKE A BENEVOLENT AND JUSTICE ORIENTED INFERENCE. FACTS MU ST BE VIEWED IN THE SOCIAL MILIEU OF A COUNTRY.' THEREFORE, KEEPING THE AFORESAID PRINCIPLES IN MIND , WHEN WE LOOK AT SECTION 48, THE LANGUAGE EMPLOYED IS UNAMBIGUOUS. T HE INTENTION IS VERY CLEAR. WHEN A CAPITAL ASSET IS TRANSFERRED, IN ORDER TO DETERMINE THE CAPITAL GAIN FROM SUCH TRANSFER, WHAT IS TO BE SEEN IS, OUT OF FULL VALUE OF THE CONSIDERATION RECEIVED OR ACCRUING, TH E COST OF ACQUISITION OF THE ASSET, THE COST OF IMPROVEMENT A ND ANY EXPENDITURE WHOLLY OR EXCLUSIVELY INCURRED IN CONNECTION WITH S UCH TRANSFER IS TO ITA NO.1087/BANG/2018 SHRI L. VIVEKANANDA, MYSORE PAGE 12 OF 18 BE DEDUCTED. WHAT REMAINS THEREAFTER IS THE CAPITAL GAIN. IT IS NOT NECESSARY THAT AFTER PAYMENT OF COST OF ACQUISITION , A TITLE DEED IS TO BE EXECUTED IN FAVOUR OF THE ASSESSEE. EVEN IN THE ABS ENCE OF A TITLE DEED, THE ASSESSEE HOLDS THAT PROPERTY AND THEREFORE, IT IS THE POINT OF TIME AT WHICH HE HOLDS THE PROPERTY, WHICH IS TO BE TAKEN I NTO CONSIDERATION IN DETERMINING THE PERIOD BETWEEN THE DATE OF ACQUISIT ION AND DATE OF TRANSFER OF SUCH CAPITAL GAIN IN ORDER TO DECIDE WH ETHER IT IS A SHORT- TERM CAPITAL GAIN OR A LONG TERM CAPITAL GAIN. 10.1 FURTHER, IN THE CASE OF RICHA BAGRODIA IN ITA NO.3601/MUM/2012 DATED 22.4.2014, THE TRIBUNAL CONS IDERED SIMILAR ISSUE AND OBSERVED AS UNDER: 4. WE HEARD BOTH THE PARTIES AND PERUSED THE ORDERS OF THE REVENUE AUTHORITIES AS WELL AS THE JUDGMENTS OF THE HON'BLE HIGH COURT AND THE DECISIONS OF THE TRIBUNAL CITED BY LEARNED REPRESEN TATIVES OF BOTH THE PARTIES. THE ONLY ISSUE THAT IS TO BE DECIDED IS WHETHER THE DATE OF ALLOTMENT OF THE FLAT OR THE DATE OF POSSESSION OF THE FLAT B Y THE ASSESSEE SHOULD BE CONSIDERED AS THE DATE FOR COMPUTING THE HOLDING PE RIOD OF 36 MONTHS. ON PERUSAL OF THE CITED ORDERS OF THE TRIBUNAL (SUPRA) , WE FIND THAT AN IDENTICAL ISSUE CAME UP FOR ADJUDICATION BEFORE THE TRIBUNAL IN THE CASE OF MEENA A HEMNANI (SUPRA), ORDER DATED 17 TH JANUARY, 2014 WHEREIN ONE OF US (AM) IS A PARTY AND THE ISSUE WAS DECIDED IN FAVOUR OF THE AS SESSEE BY RELYING ON VARIOUS DECISIONS OF THE TRIBUNAL AS WELL AS THE JUDGMENT O F THE HON'BLE GUJARAT HIGH COURT IN THE CASE OF CIT VS. ANILABEN UPENDRA SHAH (2003) 262 ITR 657 (GUJ). RELEVANT DISCUSSION IS GIVEN IN PARAS 3 & 4 OF THE SAID ORDER OF THE TRIBUNAL WHICH READ AS UNDER: 3. THERE ARE COUPLE OF ISSUES RAISED IN THIS APPEAL. R EST OF THE GROUNDS RAISED IN THE APPEAL ARE EITHER CONSEQUENTIAL OR GENERAL I N NATURE. ACCORDINGLY, THEY ARE DISMISSED AS GENERAL OR CONSEQUENTIAL. THE ISSUES, WHICH NEED TO BE ADJUDICATED IN THIS APPEAL ARE (0 IF THE CAPITAL GAINS EARNED BY THE ASSESSEE ARE IN THE NATURE OF THE SHORT TERM AS HEL D BY THE AO OR LONG TERM CAPITAL GAINS AS OFFERED BY THE ASSESSEE IN THE RET URN. AT THE OUTSET, LD COUNSEL FOR THE ASSESSEE MENTIONED THAT THE ASSESSE E PURCHASED A FLAT VIDE THE ALLOTMENT LETTER DATED 9.9.2003 FROM THE BUILDE R NAMELY PRESTIGE ESTATES PROJECTS PVT. LTD. THERE WAS A CONSTRUCTION AGREEMENT BETWEEN THE PARTIES DATED 1.12.2003 AND THE REGISTERED DEED OF THE SAME WAS DATED ON 22.9.2006. THE SAID FLAT WAS SOLD BY THE ASSESSE E TO BENNET COLEMAN & COMPANY ON 10.11.2006. THE ASSESSEE EARNED CAPITA L GAINS ON THIS TRANSACTION AND OFFERED THE SAME AS LONG TERM CAPIT AL GAINS RECKONING THE DATE OF ALLOTMENT I.E., 9.9.2003 FOR THE PURPOSE OF DETERMINING THE HOLDING PERIOD OF THREE YEARS RELEVANT FOR THE LONG TERM CA PITAL GAINS. HOWEVER, ITA NO.1087/BANG/2018 SHRI L. VIVEKANANDA, MYSORE PAGE 13 OF 18 IN THE ASSESSMENT PROCEEDINGS, AO CONSIDERED THE DA TE OF REGISTRATION I.E., 22.9.2006 THE DATE OF REGISTRATION AND DETERMINED T HE SHORT TERM CAPITAL GAINS. THEREFORE, NOW THE ISSUE TO BE DECIDED BY TH E TRIBUNAL RELATES TO IF THE DATE OF ALLOTMENT SHOULD BE CONSIDERED FOR THE PURPOSE OF COMPUTING THE SAID LONG TERM CAPITAL GAINS. IN THIS REGARD, L D COUNSEL FILED VARIOUS DECISIONS TO SUGGEST THAT THE DATE OF ALLOTMENT MUST BE CONSIDERED FOR THE PURPOSE OF COMPUTING THE LONG TERM CAPITAL GAINS IN STEAD OF DATE OF REGISTRATION. LD COUNSEL FILED THE ORDER OF THE TRI BUNAL IN THE CASE OF ACIT VS. SMT VANDANA RANA ROY VIDE ITA NO. 6173/M/2011 ( A Y 2007-2008) DATED 7.11.2012, WHEREIN ONE OF US (AM) IS A PARTY, AND STATED THAT THE 'DATE OF ALLOTMENT' SHOULD BE RECKONED AS RELEVANT DATE FOR COMPUTING THE HOLDING PERIOD FOR THE PURPOSE OF COMPUTING THE CAP ITAL GAINS. IN THIS REGARD, LD COUNSEL BROUGHT OUR ATTENTION TO PARA 7 AND 8 OF THE SAID ORDER OF THE TRIBUNAL TO SUPPORT HIS CASE. THE SAID JUDGM ENT WAS DECIDED CONSIDERING THE JUDGMENT OF THE GUJARAT HIGH COURT IN THE CASE OF CIT VS. ANILABEN UPENDRA SHAH (2003) 262 ITR 657 (GUJ) APAR T FROM OTHER DECISIONS OF THE TRIBUNAL IN THE CASE OF JITENDRA M OHAN VS. ITO (2007) 11 SOT 594 (DEL) AND ALSO ANOTHER DECISION OF THE ITA T IN THE CASE OF PRA VIN GUPTA VS. ACIT AND THE RELEVANT PROPOSITIONS AR E EXTRACTED IN PARA 7 OF THE TRIBUNAL'S ORDER DATED 7.11.2012. THE SAID P ARAS 7 AND 8 FROM THE ORDER OF THE TRIBUNAL IN THE CASE OF SMT VANDANA RA NA ROY READ AS UNDER: 7. WE HAVE HEARD BOTH THE PARTIES, PERUSED THE CITE D DECISIONS AND WE FIND THAT THERE IS NO DISPUTE ON THE FACTS THE ONLY ISSU E THAT IS TO BE DECIDED IS WHETHER DATE OF ALLOTMENT OF THE FLAT OR THE DATE O F POSSESSION OF THE FIAT BY THE ASSESSEE SHOULD BE CONSIDERED AS DATE OF HOLDIN G FOR COMPUTING THE HOLDING PERIOD OF 36 MOTHS. IN ALTERNATIVE, THE 'DA TE OF REGISTRATION' SHOULD BE THE RELEVANT DATE. ON PERUSAL OF THE SAID DECISI ONS RELIED UPON BY THE LD COUNSEL, WE FIND THAT THE DECISIONS ARE RELEVANT AN D APPLICABLE TO THE FACTS OF THE PRESENT CASE. THE CONCLUSION OF THE HONBLE GUJARAT HIGH COURT JUDGEMENT IN THE CASE OF CIT VS. JINDAS PANCHAND GA NDHI READS AS UNDER: 'ASSESSEE HAVING SOLD THE FIAT ALLOTTED TO HIM BY A CO-OPERATIVE HOUSING SOCIETY AFTER A PERIOD OF 36 MONTHS FROM THE DATE O F ALLOTMENT, CAPITAL GAINS ARISING TO HIM WERE LONG-TERM CAPITAL GAINS D ESPITE THE FACT THAT THE PHYSICAL POSSESSION OF THE FLAT WAS GIVEN TO THE AS SESSEE MUCH LATER AND, THEREFORE HE WAS ENTITLED TO DEDUCTION FROM SUCH GA INS AS PER LAW' 7.1 THE CONCLUSION OF THE HON'BLE GUJARAT HIGH COURT JUDGMENT IN THE CASE OF CIT VS. ANILABEN UPENDRA SHAH READS AS UNDER: 'ASSESSEE HAVING HELD THE SHARES AND ALLOTMENT OF A FLAT IN A CO-OPERATIVE HOUSING SOCIETY FOR A PERIOD OF MORE THAN 36 MOTHS THE CAPITAL GAIN ARISING FROM SALE OF SAID FLAT WAS LONGTERM CAPITAL GAIN AN D ASSESSEE WAS ENTITLED TO BENEFIT OF SECTION 80T IRRESPECTIVE OF THE FACT THAT THE ASSESSEE DID NOT GET ITA NO.1087/BANG/2018 SHRI L. VIVEKANANDA, MYSORE PAGE 14 OF 18 POSSESSION OF THE FIAT IN QUESTION AT THE TIME OF A LLOTMENT AND IT WAS CONSTRUCTED LATER ON.' 7.2 THE CONCLUSION OF HON'BLE ITA T, DELHI BENCH IN THE CASE OF JITENDRA MOHAN VS. ITO READS AS UNDER: 'ON THE FACTS OF THE CASE, ASSESSEE HELD THE CAPITA L ASSET (SHED) ALLOTTED TO IT ON INSTALLMENT BASIS FROM 2E DECEMBER, 1994, THE DA TE OF PAYMENT OF SECOND INSTALLMENT AND SALE THEREOF ON 1.5 7 DECEMBER, 2000, GAVE RISE TO LONG TERM CAPITAL LOSS EVEN THOUGH POSSESSION OF SHED WAS HAN DED OVER BY DSIDC TO ASSESSEE ON 28 M MAY, 1998.' 7.3 THE CONCLUSION OF HON'BLE ITA T, DELHI BENCH IN THE CASE OF PRAVEEN GUPTA VS. ACIT READS AS UNDER: 'ASSESSEE CAN BE SAID TO HAVE HELD THE FLAT WHEN HE MADE THE PAYMENT TO THE BUILDER AND RECEIVED THE ALLOTMENT LETTER, AND THER EFORE, BENEFIT OF INDEXATION OF COST OF ACQUISITION OF THE FIAT HAS TO BE GRANTE D TO THE ASSESSEE FROM THE DATE (1995) WHEN HE STARTED MAKING PAYMENT TO THE BUILDE R AND NOT FROM THE DATE OF EXECUTION OF CONVEYANCE DEED IN 2001.' 8. ALL THE ABOVE DECISIONS ARE UNIFORM IN CONCLUDIN G THAT THE 'DATE OF ALLOTMENT' IS RECKONED AS THE DATE FOR COMPUTING THE HOLDING PERI OD FOR THE PURPOSE OF CAPITAL GAINS. THE DATE OF ALLOTMENT IN THIS CASE BEING 19.11.2001 AND THE DATE OF SALE IS 23.8.2006, THEREFORE, THE H OLDING PERIOD IS MUCH MORE THAN 36 MONTHS. IN THIS CASE, THE GAINS EARNED BY T HE ASSESSEE ON THE SALE OF FLAT HAVE TO BE COMPUTED AS CAPITAL GAINS. WITHOUT PREJUDICE, EVEN IF THE DATE OF POSSESSION, BEING 14.8.2003, IS CONSIDERED; THE ASSESSEE IS STILL ENTITLED TO THE BENEFITS OF THE LONG TERM CAPITAL GAINS. THE REFORE, IN OUR OPINION, ORDER OF THE CIT (A) DOES NOT CALL FOR ANY INTERFER ENCE. ACCORDINGLY, THE GROUNDS RAISED BY THE REVENUE ARE DISMISSED.' 4.CONSIDERING THE ABOVE SETTLED NATURE OF THIS ISSU E, WE ARE OF THE OPINION THAT THE ASSESSEE MUST SUCCEED ON THIS ISSUE. ACCOR DINGLY, THE RELEVANT GROUNDS OF APPEAL ARE ALLOWED.' 7. FROM THE ABOVE SETTLED POSITION OF THE ISSUE, IT CAN BE SAFELY CONCLUDED THAT THE 'DATE OF ALLOTMENT' SHOULD BE RECKONED AS THE DATE FOR COMPUTING THE HOLDING PERIOD FOR THE PURPOSE OF CAPITAL GAINS. IN THE INSTANT CASE, THE DATE OF ALLOTMENT IS 11.04.2003 (FY 2003-2004) AND THE DATE OF SALE OF THE PROPERT' IS 14.10.2007, THEREFORE THE HOLDING PERIOD IS MORE THAN 36 MONTHS . THEREFORE, THE CAPITAL GAINS EARNED BY THE ASSESSEE ON THE SALE OF THE FLAT HAVE TO BE TREATED AS 'LONG TERM CAPITAL GAINS'. THE ASSESEE PAID THE FIR ST INSTALLMENT ON 11.4.2003, THEREBY CONFERRING A RIGHT TO HOLD A FLAT, WHICH WA S LATER IDENTIFIED AND POSSESSION DELIVERED ON LATER DATE. THE HON'BLE PUNJAB & HARYA NA HIGH COURT IN THE CASE OF MRS. MADHU KAUL VS. CIT VIDE INCOME TAX APPEAL NO.8 9 OF 1999, DATED 17 TH JANUARY, 2014 HELD THAT THE MERE FACT THAT POSSESSION WAS DELIVERED LA TER, DOES NOT DETRACT FROM THE FACT THAT THE ALLOTTEE WA S CONFERRED A RIGHT TO HOLD ITA NO.1087/BANG/2018 SHRI L. VIVEKANANDA, MYSORE PAGE 15 OF 18 PROPERTY ON ISSUANCE OF AN ALLOTMENT LETTER. THUS, THE ID DR'S ARGUMENTS ON NON-EXISTENCE OF THE FLAT AT THE TIME OF ISSUING OF ALLOTMENT LETTER STANDS ANSWERED BY THE SAID JUDGMENT OF THE HON'BLE HIGH C OURT OF PUNJAB & HARYANA (SUPRA). THE SAME VIEW WAS SUPPORTED BY VAR IOUS DECISIONS OF THE TRIBUNAL AS WELL AS THE JUDGMENTS OF THE HON'BLE GU JARAT HIGH COURT AND THE RELEVANT CONCLUSIONS WERE ALREADY EXTRACTED IN THE ABOVE PARAGRAPHS OF THIS ORDER. REGARDING THE JUDGMENTS OF THE HON'BLE JURISDICTIONAL HIGH COURT RELIED ON BY THE LD DR ARE DISTINGUISHABLE ON FACTS . THEREFORE, CONSIDERING THE ABOVE SETTLED NATURE OF THE ISSUE AS WELL AS TH E FOLLOWING THE PRINCIPLE OF CONSISTENCY, WE ARE OF THE CONSIDERED OPINION THAT THE GROUND NO.1 RAISED BY THE ASSESSEE SHOULD BE ALLOWED. ACCORDINGLY, GROUND NO.1 IS ALLOWED. 11. SAME VIEW WAS TAKEN BY COORDINATE BENCH IN THE CASE OF BHATKAL RAMARAO PRAKASH VS. ITO IN ITA NO.2692/BANG /2018 DATED 4.1.2019. BEING SO IN OUR OPINION, IN THIS CASE FO R COMPUTING THE INFLATION COST OF THE ASSET, THE DATE TO BE RECKONE D FROM THE DATE OF ALLOTMENT OF THE PROPERTY TO THE ASSESSEE AND NOT T HE DATE ON WHICH POSSESSION CERTIFICATE ISSUED TO THE ASSESSEE. FUR THER, A JUDGEMENT RELIED BY CIT IN THE CASE OF CIT VS. BALBIR SINGH M AINI (SC) (SUPRA) HAVE NO APPLICATION AND IT WAS DELIVERED ON DIFFERE NT CONTEXT WITH REFERENCE TO SECTION 2(47)(V) OF THE ACT AND THE JU DGEMENT OF HONBLE HIGH COURT RELIED BY THE ASSESSEES COUNSEL IN THE CASE OF A. SURESH RAO CITED (SUPRA) IS A DIRECT JUDGEMENT APPLICABLE TO THE FACTS OF THE CASE. BEING SO, WE HAVE NO HESITATION IN REVERSING THE FINDING OF THE LD. CIT(A) ON THIS ISSUE AND DIRECT THE A.O. TO CON SIDER THE DATE OF ALLOTMENT OF PROPERTY I.E. 20.5.1986 FOR THE PURPOS E OF DETERMINING THE COST OF INFLATION OF THE ASSETS, WHILE COMPUTING TH E COST OF ACQUISITION OF PROPERTY IN TERMS OF SECTION 49 OF THE ACT. THI S GROUND OF THE ASSESSEE IS ALLOWED. 12. NEXT GROUND FOR OUR CONSIDERATION WITH REGARD T O THE NON- GRANTING COST OF IMPROVEMENT, WHILE COMPUTING THE C APITAL GAIN. THE CONTENTION OF THE LD. A.R. IS THAT THERE WAS A BUIL DING IN THE IMPUGNED PROPERTY AND THE COST HAS TO BE CONSIDERED WHILE CO MPUTING THE COST OF ACQUISITION OF THE IMPUGNED PROPERTY. ITA NO.1087/BANG/2018 SHRI L. VIVEKANANDA, MYSORE PAGE 16 OF 18 13. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIALS AVAILABLE ON RECORD AND GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW. THERE IS NO IOTA OF EVIDENCE THAT THERE IS AN EXISTING BUILDING IN THE IMPUGNED LAND. THE ONLY CONTENTION OF THE A SSESSEE IS THAT ASSESSEE DECLARED INCOME FROM SAID PROPERTY UNDER T HE HEAD INCOME FROM HOUSE PROPERTY IN EARLIER ASSESSMENT YEARS. HOWEVER, THERE WAS NO EVIDENCE TO SHOW THAT THERE IS A BUILDING THEREI N. IN OUR OPINION, DECLARING INCOME IN THE RETURN OF INCOME FROM SIDDH ARTH NAGAR PROPERTY DOES NOT SUGGEST THAT THERE IS A BUILDING IN THE IMPUGNED PROPERTY. SINCE THE ASSESSEE HAS NOT FURNISHED ANY REVENUE RECORD TO SHOW THAT THERE IS A BUILDING OR EVIDENCE REGARDING POWER CONNECTIONS OR WATER CONNECTIONS, IN THE ABSENCE OF THIS EVIDEN CE, IT HAS TO BE NOTED THAT THERE IS NO BUILDING IN THE SCHEDULED PR OPERTY AND THE ASSESSEE IS NOT ENTITLED FOR ANY BENEFIT OF COST OF IMPROVEMENT. THIS GROUND OF APPEAL OF ASSESSEE IS ALLOWED. 14. THE LAST GROUND FOR OUR CONSIDERATION IS WITH R EGARD TO THE NON GIVING DUE CREDIT TOWARDS TCS AS PER 26AS AT RS.18, 165/-. THE LD. CIT(A) GIVEN A DIRECTION TO THE A.O. TO GIVE TCS CR EDIT TO THE ASSESSEE AFTER DUE VERIFICATION. ACCORDINGLY, THE ASSESSEE SHALL PRODUCE THE NECESSARY EVIDENCE WITH REGARD TO THE TCS CREDIT AN D THE A.O. SHALL CONSIDER THE SAME AND GIVE DUE CREDIT AS REFLECTED IN FORM 26AS. THIS GROUND OF THE ASSESSEE IS ALLOWED. ITA NO.1087/BANG/2018 SHRI L. VIVEKANANDA, MYSORE PAGE 17 OF 18 15. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS PA RTLY ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 18 TH NOV, 2020 SD/- (BEENA PILLAI) JUDICIAL MEMBER SD/- (CHANDRA POOJARI) ACCOUNTANT MEMBER BANGALORE, DATED 18 TH NOV, 2020. VG/SPS COPY TO: 1. THE APPLICANT 2. THE RESPONDENT 3. THE CIT 4. THE CIT(A) 5. THE DR, ITAT, BANGALORE. 6. GUARD FILE BY ORDER ASST. REGISTRAR, ITAT, BANGALORE. ITA NO.1087/BANG/2018 SHRI L. VIVEKANANDA, MYSORE PAGE 18 OF 18 1. DATE OF DICTATION 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER . 3. DATE ON WHICH THE APPROVED DRAFT COMES TO SR. P. S .. 4. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE DICTATING MEMBER .. 5. DATE ON WHICH THE FAIR ORDER COMES BACK TO THE S R. P.S. .. 6. DATE OF UPLOADING THE ORDER ON WEBSITE.. 7. IF NOT UPLOADED, FURNISH THE REASON FOR DOING SO .. 8. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK .. 9. DATE ON WHICH ORDER GOES FOR XEROX & ENDORSEMENT 10. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK . 11. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT REGISTRAR FOR SIGNATURE ON THE ORDER . 12. THE DATE ON WHICH THE FILE GOES TO DISPATCH SECTION FOR DISPATCH OF THE TRIBUNAL ORDER . 13. DATE OF DESPATCH OF ORDER. .. 14. DICTATION NOTE ENCLOSED