ITO, Ward - 39(4), Kolkata, Kolkata V. Pradip Kumar Ghosh & Ors, L/R of Estate of Asit Kumar Ghosh, Kolkata

ITA 1422/KOL/2011

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 83106 (ITAT-KOLKATA)
• Duration Of Justice: 2 year(s) 10 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-09-2014
• Appeal Filed By: Department
• Bench Allotted: B
• Next Hearing Date: 06-08-2014
• Assessment Year: 1993-1994
• Appeal Filed On: 20-10-2011
• Court: TRIBUNAL
• Department Lawyers: DAVID Z CHAWNGTHU ACIT
• Assessee Lawyers: MRITTUNJAY DEY
• Keywords: Cost of acquisition; Fair market value
• Section: 148

Judgement Text

, B , IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH: KOL KATA () BEFORE , /AND , ! ) [BEFORE SHRI MAHAVIR SINGH, JM & SHRI SHAMIM YAHYA, AM] ' / I.T.A NO.1422/KOL/2011 #$ %&/ ASSESSMENT YEAR: 1993-94 & ' / I.T.A NO.133/KOL/2008 #$ %&/ ASSESSMENT YEAR: 1996-97 & ' / I.T.A NO.134/KOL/2008 #$ %&/ ASSESSMENT YEAR: 1997-98 INCOME-TAX OFFICER, WD-39(4), KOLKATA VS. PRADIP K UMAR GHOSH & ORS. L/R OF ESTATE OF ASIT KR. GHOSH) (PAN: AAATP7503K) (() /APPELLANT ) (*+()/ RESPONDENT ) DATE OF HEARING: 08.08.2014 DATE OF PRONOUNCEMENT: 02.09.2014 FOR THE REVENUE: SHRI DAVID Z. CHAWNGTHU, ACIT, DR FOR THE APPELLANT: SHRI MRITTUNJAY DEY, ADVOCATE / ORDER PER SHRI MAHAVIR SINGH, JM : ALL THESE APPEALS BY REVENUE ARE ARISING OUT OF SEP ARATE ORDERS OF CIT(A)-IV, KOLKATA IN APPEAL NO. 200/CIT(A)-IV/2008-09 DATED 29.06.2011, 17&18/CIT(A)-IV/04-05 DATED 16.11.2007 RESPECTIVELY. ASSESSMENT WAS FRAMED BY I TO, WARD-39(2), KOLKATA U/S. 143(3)/254 OF THE INCOME-TAX ACT, 1961 (HEREINAFTER REFERRED T O AS THE ACT) FOR AY 1993-94 VIDE HIS ORDER DATED 30.12.2008 AND ASSESSMENTS WERE FRAMED BY ITA, WARD-39(4), KOLKATA U/S. 143(3)/147 OF THE ACT FOR ASSESSMENT YEARS 1996-97 AND 1997-98 VIDE HIS SEPARATE ORDERS DATED 31.03.2004. 2. FIRST WE TAKE UP ITA NO.1422/K/2011. THE ONLY IS SUE IN THIS APPEAL OF REVENUE IS AGAINST THE ORDER OF CIT(A) DELETING THE ADDITION M ADE BY AO ON ACCOUNT OF LONG TERM CAPITAL GAIN ASSESSED BY AO. FOR THIS, REVENUE HAS RAISED FOLLOWING GROUND NO.1: 2 ITA NO.1422/K/2011, ITA NO. 133/K/2008 & ITA. NO.134/K/2008 PRADIP KR. GHOSH & ORS. AY. 1993-94, 1996-97 & 1997-98 1. THE LD. CIT(A) HAS ERRED IN LAW AS WELL AS ON F ACT IN ACCEPTING THE CAPITAL LOSS TO THE TUNE OF RS.18,90,371/- AS AGAINST THE CAPITAL GAIN OF RS.1,20,90,700/- ASSESSED BY THE A.O. 3. BRIEF FACTS LEADING TO THE ABOVE ISSUE ARE THAT LATE ASIT KUMAR GHOSH ENTERED INTO A DEVELOPMENT AGREEMENT WITH SUPERSWA INVESTMENT LTD. (SIL) ON 27.03.1987 FOR DEVELOPMENT OF PROPERTY SITUATED AT NO 7 & 7/1, SARAT BOSE ROAD , KOLKATA. IN PURSUANCE OF DEVELOPMENT AGREEMENT, ASSESSEE WILL OWN UP 50% OF CONSTRUCTED AREA, ALLOCATING 15 FLATS WITH CAR PARKING SPACE. IN TERM OF THE SAID DEVELOPMENT AGREEMENT, T HE DEVELOPER ALSO PAID A SUM OF RS.75 LACS TO THE ASSESSEE AS A REFUNDABLE SECURITY DEPOSIT. AT THE TIME OF SAID DEVELOPMENT AGREEMENT THE AFORESAID PREMISES WERE TENANTED AND SEVERAL SUITS WERE PENDING AT ALIPORE COURT AGAINST TENANTS FOR EJECTMENT. 4. WE GATHERED FACTS FROM DOCUMENTS AND THE ORDERS OF LOWER AUTHORITIES, WHICH ARE NOW ADMITTED, THAT THE LAND WAS ORIGINALLY OWNED BY LAT E AKSHAY KUMAR GHOSH, WHO EXPIRED ON 15.10.1931 AND AS PER HIS LAST WILL SHRI PRADOSH CH ANDRA MALLICK AND SHRI DULAL CHANDRA AICH WERE APPOINTED AS EXECUTORS OF THE WILL AND BEQUEAT HED THE PROPERTY IN FAVOUR OF HIS ONLY SON AND PRESENT ASSESSEE LATE ASIT KR. GHOSH, AS AN ABS OLUTE OWNER. PROBATE WAS ALSO GRANTED BY HONBLE CALCUTTA HIGH COURT IN SUIT NO. 2518 OF 193 1. BUT THERE WAS DISPUTE AMONGST EXECUTORS AND LATE ASIT KR. GHOSH. HONBLE CALCUTTA HIGH COURT VIDE DECREE DATED 12.08.1948 IN SUIT NO. 338 OF 1947 DECLARED LATE ASIT KR. GHOS H AS ABSOLUTE OWNER OF THE PREMISES IN QUESTION AND THE EXECUTORS WERE DIRECTED TO DELIVER POSSESSION OF THE SAID PREMISES. IN TERM OF THE ABOVE, LATE ASIT KR. GHOSH BECAME THE ABSOLUTE OWNER OF THE PROPERTY W.E.F. 15.10.1931 I.E. THE DATE OF DEATH OF HIS FATHER LATE ASIT KUMAR GHO SH. 5. THE AO DURING THE COURSE OF FIRST ROUND OF ASSES SMENT, NOTED THAT THE PROVISIONS OF SECTION 2(47) OF TRANSFER OF PROPERTY ACT WAS NOT A PPLICABLE FOR AY 1987-8, WHICH REQUIRES TRANSFER TO BE COMPLETE IN TERM OF TRANSFER OF PROP ERTY ACT I.E. THE REGISTRATION OF DOCUMENT IS NECESSARY. HENCE, THE AO HAS NOT ASSESSED THE CAPI TAL GAINS IN AY 1987-88. HOWEVER, THE AO IN THIS AY I.E. AY 1993-94 ASSESSED THE LONG TERM C APITAL GAINS ON SUCH SALE OF PROPERTY BY THE ASSESSEE, BECAUSE ACTUAL POSSESSION OF THE PROP ERTY WAS TAKEN BY DEVELOPER DURING THE FY 1992-93RELEVANT TO THIS ASSESSMENT YEAR. THE AO DU RING THE COURSE OF FIRST ROUND COMPUTED THE CAPITAL GAIN FOR AN AMOUNT OF RS.1,20,90,700/- AFTE R INDEXING THE CONSIDERATION RECEIPT ON 27.03.1987 OF RS. 75 LACS (TREATING THE SAME AS CON SIDERATION). BUT CIT(A) DELETED THE ADDITION BY OBSERVING THAT, I AM OF THE OPINION THAT THERE IS CONSIDERABLE FOR CE IN THE SUBMISSIONS MADE 3 ITA NO.1422/K/2011, ITA NO. 133/K/2008 & ITA. NO.134/K/2008 PRADIP KR. GHOSH & ORS. AY. 1993-94, 1996-97 & 1997-98 ON BEHALF OF THE APPELLANT AND I HAVE NO HESITATION TO ACCEPT THE COMPUTATION OF CAPITAL LOSS TO THE TUNE OF RS.18,90,371/- WHICH IS BASED ON REASON S AND THE COMPUTATION IS MADE ON THE BASIS OF DEPARTMENTAL VALUERS REPORT. THE ORDER OF CIT(A) WAS CHALLENGED BEFORE THE TRIBU NAL AND TRIBUNAL SET ASIDE THE MATTER BACK TO THE FILE OF AO IN ITA NO.1569/K/2007 VIDE ORDER DATED 03.10.2007 BY OBSERVING IN PARA 7, WHICH READ S AS UNDER: 7. WE AFTER HEARING BOTH THE PARTIES FIND THAT THE LD. CIT(A) HAS DELETED THE ADDITION BOTH IN THE ASSESSMENT YEAR 1987-88 AND 1993-94 HOL DING THAT TRANSFER DID NOT TAKE PLACE DURING THESE YEARS, WHEREAS THE LD. COUNSEL F OR THE ASSESSEE HAS PLEADED THAT THE AMOUNT OF RS.75 LAKHS WAS DULY ADJUSTED IN THE ASSE SSMENT YEAR 1996-97 AND THE ADDITION BY THE A.O IN ASSESSMENT YEAR 1987-88 AND 1993-94 ON ACCOUNT OF SUCH RECEIPT OF MONEY WOULD TANTAMOUNT TO DOUBLE ADDITIO N. FROM THE RECORD WE FIND THAT THE ABOVE CONTENTION OF THE ASSESSEE NEEDS VERIFICA TION THAT WHETHER SUCH AMOUNT WAS ADJUSTED BY IT IN THE RETURN SUBMITTED FOR ASSESSME NT YEAR 1996-97 AND, THEREFORE, WE RESTORE THE MATTER BACK TO THE FILE OF A.O TO DECID E THE CASE AFRESH AFTER VERIFYING THE RECORD TO EXAMINE WHETHER THE SECURITY DEPOSIT WAS ADJUSTED IN ASSESSMENT YEAR 1996- 97 OR NOT AND WHETHER THE SAME WAS INCLUDED FOR TAX ATION FOR PURCHASE OR NOT. WE, THEREFORE, RESTORE THE ISSUES TO THE FILE OF ASSESS ING OFFICER FOR DECIDING THE SAME AFRESH AND ACCEPT THE GROUNDS RAISED BY THE REVENUE FOR ST ATISTICAL PURPOSES. 6. THE AO IN SECOND ROUND AGAIN REPEATED THE EARLIE R ASSESSMENT ORDER ASSESSING THE LONG TERM CAPITAL GAINS AT RS.1,20,90,700/-. ACCORDING TO AO, AGREEMENT FOR SALE OF FLATS WERE ENTERED DURING THE YEAR 1994 AND DETERMINED VALUE O F FLATS, I.E. 15 FLATS, AT RS.2,32,40,700/-. HE INDEXED THE FAIR MARKET VALUE OF LAND BY THE SUM OF RS.75 LACS RECEIVED AS SECURITY DEPOSIT IN 1987 AND INDEXED THE COST OF LAND AT RS.1,11,50, 000/-. AND ASSESSED THE CAPITAL GAINS AT RS.1,20,90,700/-. AGGRIEVED, ASSESSEE PREFERRED AP PEAL BEFORE CIT(A), RAISING ONLY ONE ISSUE THAT THE INDEXATION SHOULD HAVE BEEN DONE BY TAKING FAIR MARKET VALUE OF LAND AS ON 01.04.1981. THE CIT(A) ON THIS ISSUE DIRECTED THE AO VIDE PARA 5.2 AND 5.3 AS UNDER: 5.2. I HAVE GONE THROUGH THE PROVISIONS OF SECTION 2(47) OF THE I. T. ACT, 1961. I HAVE ALSO PERUSED SUB-CLAUSE (V) OF SECTION 2(47) OF THE I. T. ACT. I HAVE PERUSED SECTION 55(2)(B)(II) OF THE SAID ACT. THE FACTS WHICH EMER GE OUT OF THE SUBMISSION OF THE APPELLANT AND ASSESSMENT ORDER IS THAT DURING THE Y EAR UNDER CONSIDERATION THE FACT WHICH CANNOT BE DENIED IS THERE IS TRANSFER OF PROP ERTY DURING THE YEAR. BUT IN TOTALITY APPELLANT IS ENTITLED FOR INDEX COST OF ACQUISITION AS ON 01.04.1981. 5.3. AFTER CONSIDERING EACH AND EVERY FACT IN DETAI LS AS STATED ABOVE I AM OF THE OPINION THAT THERE IS CONSIDERABLE FORCE IN THE SUBMISSIONS MADE ON BEHALF OF THE APPELLANT AND I HAVE NO HESITATION TO ACCEPT THE COMPUTATION OF C APITAL LOSS TO THE TUNE OF RS.18,90,371/- WHICH BASED ON REASONS AND THE COMPU TATION IS MADE ON THE BASIS OF THE DEPARTMENTAL VALUER. AGGRIEVED, NOW REVENUE IS IN APPEAL BEFORE US. 4 ITA NO.1422/K/2011, ITA NO. 133/K/2008 & ITA. NO.134/K/2008 PRADIP KR. GHOSH & ORS. AY. 1993-94, 1996-97 & 1997-98 7. WE HAVE HEARD RIVAL SUBMISSIONS AND GONE THROUGH FACTS AND CIRCUMSTANCES OF THE CASE. THE AO IN AY 1993-94, I.E. RELEVANT AY, ASSESSED LO NG TERM CAPITAL GAINS, ON SALE OF ABOVE STATED PROPERTY FOR THE REASON THAT ACTUAL POSSESSI ON OF THE PROPERTY WAS DELIVERED TO DEVELOPER DURING FY 1992-93. THE AO DURING THE COURSE OF FIR ST ROUND COMPUTED LONG TERM CAPITAL GAINS AT RS.1,20,90,700/- BY INDEXING THE REFUNDABLE SECU RITY DEPOSIT RECEIVED ON 27.03.1987 FOR A SUM RS. 75 LACS (TREATING THE SAME AS CONSIDERATION ). BUT CIT(A) DELETED THE ADDITION AND REVENUE CHALLENGED THE SAME BEFORE TRIBUNAL AND TRI BUNAL SET ASIDE THE MATTER BACK TO THE FILE OF AO. NOW THE AO IN SECOND ROUND AGAIN REPEATED TH E EARLIER ASSESSMENT ORDER ASSESSING THE LONG TERM CAPITAL GAINS AT RS.1,20,90,700/-. ACCOR DING TO AO, AGREEMENT FOR SALE OF FLATS WERE ENTERED DURING THE YEAR 1994 AND DETERMINED VA LUE OF FLATS, I.E. 15 FLATS, AT RS.2,32,40,700/-. HE INDEXED THE FAIR MARKET VALUE OF LAND BY THE SUM OF RS.75 LACS RECEIVED AS SECURITY DEPOSIT IN 1987 AND INDEXED THE COST OF LAND AT RS.1,11,50,000/-. AND ASSESSED THE CAPITAL GAINS AT RS.1,20,90,700/-. FROM THESE FACTS IT IS CLEAR THAT THE LAND OF ASSESSEE WAS AN ANCESTRAL LAND ACQUIRED BY HIM PRIOR TO 01.04.1981 AND HENCE, THE FAIR MARKET VALUE OF THE LAND FOR THE PURPOSE OF COMPUTATION OF LONG TERM CAPITAL GAINS OUGHT TO HAVE BEEN TAKEN FOR INDEXING THE FMV AS ON 01.04.1981. ANOTHER IMPORTAN T FACT DISCUSSED BY CIT(A) IN HIS ORDER THAT DEPARTMENTAL VALUATION OFFICER (DVO) ASSESSED THE VALUE OF LAND AS ON 13.04.1984 @ RS.3,37,500/- PER COTTAH. THE TOTAL LAND WAS TO THE TUNE OF 25 COTTAHS. ACCORDINGLY, FMV OF 25 COTTAHS OF THE LAND OF THE ASSESSEE COMES TO RS.84, 37,500/-. THE CIT(A) HAS ADOPTED THE SAME FOR THE PURPOSE OF COMPUTATION OF LTCG. THE AO ALSO ADMITTED THE VALUE ESTIMATED BY DVO AS ON 13.04.1984 VIDE VALUERS REPORT DATED 29.03.1 999 IN HIS REMAND REPORT BEARING NO. ITO/39(4)/P.GHOSH-REMAND/10-11/637 DATED 12.01.2011 , WHEREIN HE ADMITTED IN PARA 2 AS UNDER: 2) WHILE CALCULATING THE ABOVE CAPITAL GAIN IT IS FURTHER OBSERVED THAT RELIANCE HAS BEEN PLACED ON THE SAID ASSESSMENT ORDER FOR THE AS SESSMENT YEAR 1987-88. BUT, AS PER RECORDS AVAILABLE WITH THIS OFFICE THE ABOVE ORDER IS NO LONGER EXISTENT SINCE THE SAME WAS SUBSEQUENTLY SET ASIDE AND FRESH ASSESSMENT WAS ALS O MADE FOR THE SAID ASSESSMENT YEAR ON 30.12.2008 AT A TOTAL NCOME OF RS.63,472/- WHER EIN ON INCOME UNDER THE HEAD OF CAPITAL GAIN AS ABOVE WAS INCLUDED IN ASSESSING THE TOTAL INCOME OF THE ASSESSEE. FURTHER, THE VALUATION OF THE DEPARTMENTAL VALUER DATED 29.0 3.1990 ON THE BASIS OF WHICH THE ASSESSMENT ORDER REFERRED TO BY THE ASSESSEE, HAD B EEN FRAMED, WAS SUBSTITUTED BY A REVISED VALUATION MADE BY THE DEPARTMENTAL VALUER V IDE DVOS LETTER DATED 16.10.1992 VALUING THE VALUE OF THE ASSESSEES LAND OF RS.84,3 8,000/- AS ON 13.04.1984. WE FIND THAT THE CIT(A) HAS RIGHTLY DIRECTED THE AO TO ACCEPT THE COMPUTATION OF LONG TERM CAPITAL GAIN AS COMPUTED BY THE ASSESSEE ON THE BAS IS OF DVOS REPORT ASSESSING THE FMV OF LAND AS ON 13.04.1984 AT RS.84,38,000/-. WE FIND TH AT THE CIT(A) HAS RIGHTLY DIRECTED THE AO TO 5 ITA NO.1422/K/2011, ITA NO. 133/K/2008 & ITA. NO.134/K/2008 PRADIP KR. GHOSH & ORS. AY. 1993-94, 1996-97 & 1997-98 TAKE THE FMV OF THE LAND FOR ASSESSING THE LTCG BY APPLYING INDEXATION AS ON 01.04.1981 AT RS.84,96,400/-. WE FIND NO INFIRMITY IN THE ORDER OF CIT(A) AND HENCE, THE SAME IS CONFIRMED. THE APPEAL OF REVENUE IS DISMISSED. 8. NOW, WE TAKE UP ITA NO.133/K/2008 (REVENUES APP EAL). THE ONLY ISSUE IN THIS APPEAL OF REVENUE IS AGAINST THE ORDER OF CIT(A) DELETING THE ASSESSMENT OF LONG TERM CAPITAL GAINS BY THE AO FROM SALE OF FLATS AT RS.1,13,56,600/-. FOR THIS, REVENUE HAS RAISED FOLLOWING FOUR GROUNDS: 1. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE LD. CIT(A) ERRED IN HOLDING THAT LONG TERM CAPITAL GAIN OF RS. 1,13,56,600/- FROM SA LE OF FLATS WAS NOT CHARGEABLE TO TAX IN THE ASSESSMENT YEAR 1996-97 WHEN THE ASSESSEE RE CEIVED THE SALE CONSIDERATION OF THE FLATS IN THE PREVIOUS YEAR RELEVANT TO ASSESSMENT Y EAR 1996-97. 2. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE LD. C.I.T.(A) ERRED IN HOLDING THAT THE LONG TERM CAPITAL GAIN ON SALE OF FLAT WAS TO B E DETERMINED IN THE YEAR ONLY WHEN PART POSSESSION OF THE PROPERTY ( LAND ) HAD TAKEN PLACE AND NOT IN THE YEAR WHEN THE FLATS ALLOCATED TO THE ASSESSEE AS PER AGREEMENT AFTER C ONSTRUCTION OF THE BUILDING ON THE LAND WAS SOLD BY THE ASSESSEE. 3. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE LD. C.I.T.(A) ERRED IN IGNORING THE PROVISIONS OF SECTION 2(4)&(I) OF THE I. T. ACT 6 1 WHILE DECIDING THE CASE. 4. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE LD. C.I.T.(A) ERRED IN HOLDING THAT LONG TERM CAPITAL GAIN FROM SALE OF FLATS WAS NOT T AXABLE IN ASSESSMENT YEAR 1996-97 BY WRONGLY APPLYING THE PROVISIONS OF SECTION 2(47) (V) OF THE I. T. ACT, 61. 9. WE HAVE HEARD RIVAL SUBMISSIONS AND GONE THROUGH FACTS AND CIRCUMSTANCES OF THE CASE. AS THE FACTS ARE DISCUSSED IN THE ABOVE APPEAL IN I TA NO. 1422/K/2011, THE ASSESSEE HAS RECEIVED 15 FLATS IN TERM OF DEVELOPMENT AGREEMENT. ON COMPLETION OF CONSTRUCTION OF THE BUILDING THE ASSESSEE BECAME OWNER OF 50% OF THE PR OPERTY COMPRISING OF 15 FLATS. ACCORDING TO AO, THE DEVELOPER SOLD THESE 15 FLATS TO 15 BUYE RS FOR A TOTAL CONSIDERATION OF RS.2,32,40,700/- AND AFTER ADJUSTING THE SECURITY D EPOSIT OF RS.75 LACS RECEIVED NET CONSIDERATION AT RS.1,57,40,700/-. THE AO NOTED IN HIS ASSESSMENT ORDER THAT THE ASSESSEE RECEIVED PART OR FULL PAYMENT OF RS.1,13,56,600/- R ELATING TO SALE OF 15 FLATS. THE ASSESSEE, IN RESPONSE TO NOTICE U/S. 148 OF THE ACT FILED RETURN OF INCOME AND DISCLOSED RECEIVING THE SUM OF RS.16 LACS AS PART PAYMENT FOR SALE OF THE ABOVE FL ATS. HOWEVER, THE AO NOTED FROM THE DETAILED STATEMENT OF PAYMENT FURNISHED BY THE DEVE LOPER THAT DURING THE ACCOUNTING YEAR 1995- 96 RELEVANT TO THIS ASSESSMENT YEAR 1996-97 THEY HA VE MADE FULL OR PART PAYMENT FOR SALE OF 15 FLATS AT RS.1,13,56,600/-. THE AO TAKING THE COST OF ACQUISITION AS NIL, ASSESSED THE ENTIRE CONSIDERATION AS LONG TERM CAPITAL GAINS. AGGRIEVE D, ASSESSEE PREFERRED APPEAL BEFORE 6 ITA NO.1422/K/2011, ITA NO. 133/K/2008 & ITA. NO.134/K/2008 PRADIP KR. GHOSH & ORS. AY. 1993-94, 1996-97 & 1997-98 CIT(A), WHO DELETED THE ADDITION OF LONG TERM CAPIT AL GAINS VIDE PARA 16 AND 17 OF HIS APPELLATE ORDER BY OBSERVING AS UNDER: 16. THE SAID ASIT KUMAR GHOSH BECAME OWNER OF THE S AID PREMISES UNDER WILL. THE SAID PREMISES BECAME THE PROPERTY OF ASIT KUMAR GHO SH UNDER SUB CLAUSE (II) OF CLAUSE 1 TO SECTION 49 OF THE ACT. BY A LETTER DATED 24.0 3.2004 A COMPUTATION SHEET WAS FILED COMPUTING THE FAIR MARKET VALUE AS ON 01.04.1981. THE ASSESSEE, THEREFORE, EXERCISED THE OPTION TO ADOPT THE FAIR MARKET VALUE OF THE AS SET AS ON 01.04.1981. UNDER THE ACT IT WAS NECESSARY FOR THE ITO TO DETERMINE THE COST OF ACQUISITION OF THE ASSET AS ON 01.04.1981 BEFORE COMPUTATION OF CAPITAL GAIN. 17. I FULLY AGREE WITH THE AR WHO HAS RELIED UPON THE RATIO OF THE JUDGMENT IN THE CASE OF CIT VS. LALITABEN AND CIT VS. DUNCAN BROTHERS CO . LTD. I HAVE GIVEN DUE CONSIDERATION TO THE SUBMISSION MADE BY THE AR AND AGREE THAT THE DEPARTMENT CANNOT ASSESS CAPITAL GAIN BOTH WHEN POSSESSION WAS GIVEN AND WHEN THE OWNERS ALLOCATION IN THE SAID PREMISES WAS SOLD. THE CAPITAL GAINS, IF ANY, WILL ARISE ONLY IN THE ASSESSMENT YEAR WHEN PART POSSESSION OF THE PROPERTY WAS GIVEN . I, THEREFORE, DIRECT THE AO TO DETERMINE THE YEAR IN WHICH PART POSSESSION OF THE PREMISES HAD TAKEN PLACE AND TO ASSESS THE CAPITAL GAIN, IF ANY, IN THAT ASSESSMENT YEAR AFTER DETERMINING THE COST OF ACQUISITION OF THE SAID PREMISES AS DISCUSSED ABOVE . 10. WE FIND THAT IN THE ASSESSMENT YEAR UNDER CONSI DERATION THE ASSESSEE HAD RECEIVED A SUM OF RS.16 LAC OR RS.1,13,56,600/- BUT ADMITTED FACTS ARE THAT THIS IS ONLY PART PAYMENT FOR SALE OF 15 FLATS, WHICH WERE OWNED BY ASSESSEE IN LIEU OF D EVELOPMENT AGREEMENT. THE LONG TERM CAPITAL GAINS ARISING OUT OF DEVELOPMENT AGREEMENT HAS ALREADY ASSESSED IN AY 1993-94 AND THE SAME HAS BEEN DISCUSSED IN THIS VERY ORDER WHIL E ADJUDICATING ITA NO. 1422/K/2011. FROM THE FACTS DISCUSSED IN THE ASSESSMENT ORDER, NO WHE RE IT IS ALLEGED BY THE REVENUE THAT IN THIS YEAR THE POSSESSION OF FLATS WERE GIVEN TO THE BUYE RS OR FULL PAYMENT WAS RECEIVED SO AS TO ACCRUAL OF THE CONSIDERATION, ON ACCOUNT OF SALE OF THESE FLATS, TO THE ASSESSEE. IN SUCH CIRCUMSTANCES, WE FIND THAT THE CIT(A) HAS RIGHTLY DIRECTED THE AO TO ASSESS THE CAPITAL GAINS IN THE YEAR OF ACCRUAL OF THE SAME. HENCE, WE FIND NO INFIRMITY IN THE ORDER OF CIT(A) AND THE SAME IS HEREBY UPHELD. APPEAL OF REVENUE IS DISMIS SED. 11. COMING TO ITA NO. 134/K/2008. THE ONLY ISSUE I N THIS APPEAL OF REVENUE IS AGAINST THE ORDER OF CIT(A) DELETING THE ADDITION OF LONG TERM CAPITAL GAINS ASSESSED BY AO AMOUNTING TO RS.43,84,100/-. FOR THIS, REVENUE HAS RAISED FO LLOWING FOUR GROUNDS: 1. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CAS E THE LD. CIT(A) ERRED IN HOLDING THAT LONG TERM CAPITAL GAIN OF RS.43,84,100/- FROM SALE OF FLATS WAS NOT CHARGEABLE TO TAX IN THE ASSESSMENT YEAR 1997-98 WHEN THE ASSESSEE RECEI VED THE SALE CONSIDERATION OF THE FLATS IN THE PREVIOUS YEAR RELEVANT TO ASSESSMENT Y EAR 1997-98. 2. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE LD. CIT(A) ERRED IN HOLDING THAT THE LONG TERM CAPITAL GAIN ON SALE OF FLATS WAS TO BE DETERMINED IN THE YEAR ONLY WHEN 7 ITA NO.1422/K/2011, ITA NO. 133/K/2008 & ITA. NO.134/K/2008 PRADIP KR. GHOSH & ORS. AY. 1993-94, 1996-97 & 1997-98 PART POSSESSION OF THE PROPERTY (LAND) HAD TAKEN PL ACE AND NOT IN THE YEAR WHEN THE FLATS ALLOCATED TO THE ASSESSEE AS PER AGREEMENT AFTER CO NSTRUCTION OF THE BUILDING ON THE LAND WAS SOLD BY THE ASSESSEE. 3. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE LD. CIT(A) ERRED IN IGNORING THE PROVISIONS OF SECTION 2(47)(I) OF THE I. T. ACT 61 WHILE DECIDING THE CASE. 4. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE LD. CIT(A) ERRED IN HOLDING THAT LONG TERM CAPITAL GAIN FROM SALE OF FLATS WAS NOT T AXABLE IN ASSESSMENT YEAR 1997-98 BY WRONGLY APPLYING THE PROVISIONS OF SECTION 2(47)(V) OF THE I. T. ACT61. 12. AS IN AY 1996-97 IN ITA NO. 133/K/2008, IN THIS YEAR ALSO THE ASSESSEE RECEIVED PART PAYMENT OF RS.43,84,100/- FOR SALE OF 15 FLATS AND AO EXACTLY ON IDENTICAL FACTS IN THIS YEAR ALSO ASSESSED THIS AS LONG TERM CAPITAL GAINS. CIT(A) O N IDENTICALLY WORDED ORDER, AS IN EARLIER ASSESSMENT YEAR 1996-97, DELETED THE ADDITION AND D IRECTED THE AO ASSESS THE LONG TERM CAPITAL GAINS IN THE YEAR OF ACCRUAL OF THE SAME. AS THE ISSUE AND FACTS ARE IDENTICAL TO IMMEDIATE PRECEDING ASSESSMENT YEAR, WE FIND NO INF IRMITY IN THE ORDER OF CIT(A) AND THE SAME IS HEREBY UPHELD. APPEAL OF REVENUE IS DISMISSED. 13. IN THE RESULT, ALL APPEALS OF REVENUE ARE DISMI SSED. 14. ORDER IS PRONOUNCED IN THE OPEN COURT ON 02.09. 2014. SD/- SD/- , ! , (SHAMIM YAHYA ) (MAHAVIR SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 2ND SEPTEMBER, 2014 ,- #./ 0 JD.(SR.P.S.) 1 *2 3 2%4- COPY OF THE ORDER FORWARDED TO: 1 . () / APPELLANT ITO, WARD-39(4), KOLKATA. 2 *+() / RESPONDENT PRADIP KUMAR GHOSH & ORS., L/R OF ES TATE OF ASIT KUMAR GHOSH, 47, PATHURIA GHAT STREET, KOLKATA -700 006. 3 . # ( )/ THE CIT(A), KOLKATA 4. 5. # / CIT KOLKATA 2:; *# / DR, KOLKATA BENCHES, KOLKATA +2 */ TRUE COPY, #