MAITRI MORARJI, MUMBAI V. ITO (IT) 4(1), MUMBAI

ITA 3864/MUM/2016

• Counselvise Citation: [2018] 119 COUNSELVISE.COM (IT) 0236 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 5 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-12-2018
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: Not Allotted
• Assessment Year: misc
• Appeal Filed On: 07-06-2016
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Keywords: Sale consideration of property below Jantri Value; Capital asset; Cost of acquisition
• Section: 143(3); 50C; 147; 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL BEFORE HONBLE SHRI HONBLE SHRI MANOJ KUMAR AGGARWAL, AM ( MS. MAITRI MORARJI 8, VASANT VIHAR M.L. DAHANUKAR ROAD MUMBAI-400 026 ( APPELLANT ASSESSEE BY REVENUE BY DATE OF HEARING DATE OF PRONOUNCEMENT PER MANOJ KUMAR AGGARWAL (ACCOUNTANT MEMBER) 1. AFORESAID APPEAL BY ASSESSEE FOR CONTEST THE ORDER OF LD. C MUMBAI, [CIT(A)], 1 ASSESSMENT YEAR : 2010 1 IN THE INCOME TAX APPELLATE TRIBUNAL H BENCH, MUMBAI !' #!$% , $% BEFORE HONBLE SHRI PAWAN SINGH , JM SHRI MANOJ KUMAR AGGARWAL, AM I.T.A. NO.3864/MU M/201 ASSESSMENT YEAR: 2010- 11 VS. INCOME TAX OFFICER(IT) SCINDIA HOUSE MUMBAI-400 001. PAN/GIR NO. AADPM-9753- F APPELLANT ) : ( &' RESPONDENT ASSESSEE BY : K.GOPAL & NEHA PARANJAPE REVENUE BY : MANOJ KUMAR SINGH- LD.DR ( DATE OF HEARING : 14/11/2018 ( / DATE OF PRONOUNCEMENT : 05/12/2018 O R D E R PER MANOJ KUMAR AGGARWAL (ACCOUNTANT MEMBER) BY ASSESSEE FOR ASSESSMENT YEAR [AY] 20 OF LD. C OMMISSIONER OF INCOME TAX (APPEALS) APPEAL NO.CIT(A)-57/ ARR.81/2015 ITA 3864/MUM/2016 MAITRI MORARJI ASSESSMENT YEAR : 2010 -11 IN THE INCOME TAX APPELLATE TRIBUNAL $% )* , JM AND SHRI MANOJ KUMAR AGGARWAL, AM M/201 6 11 ) TAX OFFICER(IT) - 4(1) 001. F RESPONDENT ) K.GOPAL & NEHA PARANJAPE - LD. ARS LD.DR ASSESSMENT YEAR [AY] 20 10-11 TAX (APPEALS) -57, ARR.81/2015 -16 DATED 29/02/2016 ON SEVERAL GROUNDS OF APPEAL. THE ASSESSEE HAS ALSO FILED AN ADDITIONAL GROUND OF APPEAL WHICH IS PURELY A LE GAL GROUND AND DO TO REQUIRE APPRECIATION OF NEW FACTS AND HENCE, TAKEN ON RECOR D. FINALLY, THE EFFECTIVE GROUNDS READ AS UNDER: 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE A ND IN LAW, THE LEARNED CIT(A) HAS ERRED IN UPHOLDING THE APPLICATION OF SECTION 5 0C OF THE ACT BY THE OFFICER FOR THE PURPOSE OF THE VALUATION OF THE LA ND AT RS.70,14,776/ THE DVO INSTEAD OF RS. 2. THE PROVISIONS OF S CONVEYANCE DATED 31 BOTH IS TRANSFERRED. SECTION 50C OF THE ACT BY ADOPTING FAIR MARKET VALU E OF THE PROPERTY ON THE DATE OF CONVEYANCE AS FULL VALUE OF CONSID GAINS IS NOT AT ALL JUSTIFIED AND THE SAME MAY BE D ELETED THE ASSESSEE BEING NON IN SCRUTINY ASSESSMENT U/S 143(3) WHEREIN THE I NCOME OF THE ASSESSEE WAS ASSESSED AT RS.68.26 LACS AFTER CERTAIN ADDITION OF RS.23.30 LACS UNDER THE H EAD AGAINST RETURNED INCOME OF RS.44.95 LACS FILED BY T HE ASSESSEE ON 22/02/2013. THE ASSESSEE WAS SUBJECTED TO REASSESSMENT PROCEEDI NGS VIDE ISSUANCE OF NOTICE U/S 148 DATED 14/03/2013. 2. DURING ASSESSMENT PROCEEDINGS, IT TRANSPIRED THAT T HE ASSESSEE EARNED LONG TERM CAPITAL GAIN [LTCG] [PROPERTY] WHEREIN HER SHARE WAS 8.33%. HOWEVER, IT WAS SEEN T HAT THE ASSESSEE HAD NOT TAKEN FULL VALUE OF CONSIDERATION AS PER SECTION 50C RESULTING IN TO SHORT DISCLOSURE OF SAME VIDE REPLY DATED 13/11/2013 WHEREIN IT WAS SUB MITTED T WAS NO TRANSFER OF LAND OR BUILDING BY THE ASSESSEE ALREADY SOLD TO THE BUYER FOR CONSIDERATION OF RS.3 4,958/ 2 ASSESSMENT YEAR : 2010 2 ON SEVERAL GROUNDS OF APPEAL. THE ASSESSEE HAS ALSO FILED AN ADDITIONAL GROUND OF APPEAL WHICH IS PURELY A LE GAL GROUND AND DO TO APPRECIATION OF NEW FACTS AND HENCE, TAKEN ON RECOR D. FINALLY, THE EFFECTIVE GROUNDS READ AS UNDER: - ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE A ND IN LAW, THE LEARNED CIT(A) HAS ERRED IN UPHOLDING THE APPLICATION OF SECTION 5 0C OF THE ACT BY THE OFFICER FOR THE PURPOSE OF THE VALUATION OF THE LA ND AT RS.70,14,776/ THE DVO INSTEAD OF RS. 53,31,200/- AS OFFERED BY THE APPELLANT. THE PROVISIONS OF S ECTION 50C OF THE ACT ARE NOT ATTRACTED TO THE DEED OF CONVEYANCE DATED 31 ST DEC., 2009 AS NO CAPITAL ASSET BEING LAND OR BUILDI NG OR BOTH IS TRANSFERRED. HENCE, THE APPELLANT PRAYS THAT THE ADDITION MADE I NVOKING SECTION 50C OF THE ACT BY ADOPTING FAIR MARKET VALU E OF THE PROPERTY ON THE DATE OF CONVEYANCE AS FULL VALUE OF CONSID ERATION FOR THE PURPOSE OF COMPUTING CAPITAL GAINS IS NOT AT ALL JUSTIFIED AND THE SAME MAY BE D ELETED . NON -RESIDENT INDIAN WAS ASSESSED FOR IMPUGNED AY IN SCRUTINY ASSESSMENT U/S 143(3) READ WITH SECTION 147 NCOME OF THE ASSESSEE WAS ASSESSED AT RS.68.26 LACS AFTER CERTAIN ADDITION OF RS.23.30 LACS UNDER THE H EAD AGAINST RETURNED INCOME OF RS.44.95 LACS FILED BY T HE ASSESSEE ON THE ASSESSEE WAS SUBJECTED TO REASSESSMENT PROCEEDI NGS VIDE ISSUANCE OF NOTICE U/S 148 DATED 14/03/2013. DURING ASSESSMENT PROCEEDINGS, IT TRANSPIRED THAT T HE ASSESSEE LONG TERM CAPITAL GAIN [LTCG] ON SALE OF CERTAIN INHERITED WHEREIN HER SHARE WAS 8.33%. HOWEVER, IT WAS SEEN T HAT THE ASSESSEE HAD NOT TAKEN FULL VALUE OF CONSIDERATION AS PER SECTION 50C SHORT DISCLOSURE OF LTCG. THE ASSESSEE DEFENDED THE SAME VIDE REPLY DATED 13/11/2013 WHEREIN IT WAS SUB MITTED T WAS NO TRANSFER OF LAND OR BUILDING BY THE ASSESSEE SINCE THE SAME WAS ALREADY SOLD TO THE BUYER FOR CONSIDERATION OF RS.3 4,958/ ITA 3864/MUM/2016 MAITRI MORARJI ASSESSMENT YEAR : 2010 -11 ON SEVERAL GROUNDS OF APPEAL. THE ASSESSEE HAS ALSO FILED AN ADDITIONAL GROUND OF APPEAL WHICH IS PURELY A LE GAL GROUND AND DO TO APPRECIATION OF NEW FACTS AND HENCE, TAKEN ON RECOR D. FINALLY, THE ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE A ND IN LAW, THE LEARNED CIT(A) HAS ERRED IN UPHOLDING THE APPLICATION OF SECTION 5 0C OF THE ACT BY THE ASSESSING OFFICER FOR THE PURPOSE OF THE VALUATION OF THE LA ND AT RS.70,14,776/ - AS MADE BY AS OFFERED BY THE APPELLANT. ECTION 50C OF THE ACT ARE NOT ATTRACTED TO THE DEED OF DEC., 2009 AS NO CAPITAL ASSET BEING LAND OR BUILDI NG OR HENCE, THE APPELLANT PRAYS THAT THE ADDITION MADE I NVOKING SECTION 50C OF THE ACT BY ADOPTING FAIR MARKET VALU E OF THE PROPERTY ON THE DATE ERATION FOR THE PURPOSE OF COMPUTING CAPITAL WAS ASSESSED FOR IMPUGNED AY READ WITH SECTION 147 ON 29/03/2014 NCOME OF THE ASSESSEE WAS ASSESSED AT RS.68.26 LACS AFTER CERTAIN ADDITION OF RS.23.30 LACS UNDER THE H EAD CAPITAL GAINS AS AGAINST RETURNED INCOME OF RS.44.95 LACS FILED BY T HE ASSESSEE ON THE ASSESSEE WAS SUBJECTED TO REASSESSMENT PROCEEDI NGS DURING ASSESSMENT PROCEEDINGS, IT TRANSPIRED THAT T HE ASSESSEE ON SALE OF CERTAIN INHERITED LAND WHEREIN HER SHARE WAS 8.33%. HOWEVER, IT WAS SEEN T HAT THE ASSESSEE HAD NOT TAKEN FULL VALUE OF CONSIDERATION AS PER SECTION 50C THE ASSESSEE DEFENDED THE SAME VIDE REPLY DATED 13/11/2013 WHEREIN IT WAS SUB MITTED T HAT THERE SINCE THE SAME WAS ALREADY SOLD TO THE BUYER FOR CONSIDERATION OF RS.3 4,958/ - VIDE AGREEMENT DATED 10/03/1971 WHEREIN THE POSSESSION O F THE LAND WAS ALSO HANDED OVER THE BUYER. THE ATTENTION THE VALUATION OF THE LAND AS PER REPORT DATED 27/01/200 9 OF AUTHORIZED VALUER WAS RS.636 LACS AS AGAINST RS.640 DEED OF CONVEYANCE. HOWEVER, LD. AO OP SECTION 50C WERE APPLICA THE DEEMED SALE CONSIDERATION AS RS.842.11 AS VALUE D BY DIFFERENTIAL AMOUNT OF LTCG WAS ADDED TO THE INCOME OF THE ASSESSEE. 3. AGGRIEVED, THE ASSESSEE AGITATED THE SAME WITHOUT A NY SUCCESS BEFORE LD. CIT(A) VIDE IMPUGNED ORDER DATED 29/02/2016 WHEREIN LD. FIRST APPELLATE AUTHORITY ADJUDICATED THE ISSUE BY OBSERVING AS UNDER: 4.3 DECISION: I HAVE CONSIDERED THE ISSUE AS BROUGHT OU CONTENTIONS OF THE APPELLATE. THE 2 MAIN ISSUES THA T EMERGE OUT OF THE DISCUSSION ABOVE ARE: 1) WHETHER THE DATE OF THE TRANSFER OF T HE SAID PROPERTY IS TO BE TAKEN AS 1971 WHEN AN AGREEMENT WAS SIGNED BETWEEN RATANSI A ND IT TO BE 2009 WHEN THE CONVEYANCE DEED HAS BEEN SIG NED BETWEEN THE 5 VENDORS (THE APPELLANT BEING ONE OF THE VENDORS) AND TATA P OWER CO. 2) FOR THE PURPOSE OF CALCULATION OF THE LONG - DATE OF ACQUISITION SHALL BE 1981 OR 2000, WHEN THE GRANDMOTHER OF THE APPELLANT DIED FROM WHOM THE APPELLANT HAS INHERITED THE SAID PROPERTY. TO APPRECIATE THE ISSUE IT IS IMPORTANT TO DELINEAT E THE FACT. FROM THE CONVEYANCE DEED THE FACT THAT EMERGE ARE AS UNDER: THE DEED OF CONVEYANCE HAS BEE N MADE ON DECEMBER 2009 BETWEEN THE 5 VENDORS AND TATA POWER CO LTD BEING THE PURCHASER. THE DEED RECORDS THE FOLLOWING FACTS: RA TANSI MORARJI WA OWNER OF THE PROPERTY IN QUESTION. HE DIED I SAID PROPERTY TO HIS WIFE AND 2 SONS, PRATAPSINH AN D DHAIRAYSINH. THE WIFE DIED IN 1968 AND BOTH THE SONS IN DATED HER SHARE ALSO. SUB SEQUENTLY DHIRAYSINH ALSO DIED IN 1970 AND HIS WIFE AND DAUGHTERS INHERITED H GRANDDAUGHTER OF THE WIFE IN THIS CASE. IN 1971 PR ATAPSINH ENTERED INTO AN AGREEMENT WITH TATA POWER CO LTD TO SELL THE SAID PROPERTY SUBJECT TO THE ENCUMBRANCES AND OCCUPANTS. THE SALE WAS HOWEVER NO T CONSUMMATED AT THAT TIME. THE PRESENT DEED OF CONVEYANCE THEREFORE PORT S THE 5 VENDORS AS BE UNDISPUTED OWNERS OF THE SAID PROPERTY IN DIFFERENT IAL PERCENTAGE OF SHARE. SPECIFIC REFERENCE IS MADE TO PARA L OF THE SAID DEED WHICH MENTIONS AS UNDER ' SAVE AS 3 ASSESSMENT YEAR : 2010 3 AGREEMENT DATED 10/03/1971 WHEREIN THE POSSESSION O F THE LAND WAS ALSO HANDED OVER THE BUYER. THE ATTENTION WAS ALSO DRAWN TO TH VALUATION OF THE LAND AS PER REPORT DATED 27/01/200 9 OF AUTHORIZED WAS RS.636 LACS AS AGAINST RS.640 LACS REFLECTED UNDER THE HOWEVER, LD. AO OP INED THAT THE SECTION 50C WERE APPLICA BLE TO THE FACTS OF THE CASE. THE DEEMED SALE CONSIDERATION AS RS.842.11 AS VALUE D BY LTCG WAS WORKED OUT AS RS.23.30 LACS WHICH WAS ADDED TO THE INCOME OF THE ASSESSEE. AGGRIEVED, THE ASSESSEE AGITATED THE SAME WITHOUT A NY SUCCESS CIT(A) VIDE IMPUGNED ORDER DATED 29/02/2016 WHEREIN LD. FIRST APPELLATE AUTHORITY ADJUDICATED THE ISSUE BY OBSERVING AS UNDER: I HAVE CONSIDERED THE ISSUE AS BROUGHT OU T BY THE ASSESSING OFFICER AND THE CONTENTIONS OF THE APPELLATE. THE 2 MAIN ISSUES THA T EMERGE OUT OF THE DISCUSSION ABOVE ARE: 1) WHETHER THE DATE OF THE TRANSFER OF T HE SAID PROPERTY IS TO BE TAKEN AS 1971 WHEN AN AGREEMENT WAS SIGNED BETWEEN RATANSI A ND TATA POWER CO LTD OR IS IT TO BE 2009 WHEN THE CONVEYANCE DEED HAS BEEN SIG NED BETWEEN THE 5 VENDORS (THE APPELLANT BEING ONE OF THE VENDORS) AND TATA P OWER CO. 2) FOR THE PURPOSE OF - TERM CAPITAL GAIN IN THE HANDS OF THE APPELLANT DATE OF ACQUISITION SHALL BE 1981 OR 2000, WHEN THE GRANDMOTHER OF THE APPELLANT DIED FROM WHOM THE APPELLANT HAS INHERITED THE SAID PROPERTY. TO APPRECIATE THE ISSUE IT IS IMPORTANT TO DELINEAT E THE FACT. FROM THE CONVEYANCE EMERGE ARE AS UNDER: THE DEED OF CONVEYANCE HAS BEE N MADE ON DECEMBER 2009 BETWEEN THE 5 VENDORS AND TATA POWER CO LTD BEING THE PURCHASER. THE DEED RECORDS THE FOLLOWING FACTS: RA TANSI MORARJI WA OWNER OF THE PROPERTY IN QUESTION. HE DIED I N 1959 AND BY VIRTUE OF HIS WILL HE LEFT THE SAID PROPERTY TO HIS WIFE AND 2 SONS, PRATAPSINH AN D DHAIRAYSINH. THE WIFE DIED IN 1968 AND BOTH THE SONS IN DATED HER SHARE ALSO. SUB SEQUENTLY DHIRAYSINH ALSO DIED IN 1970 AND HIS WIFE AND DAUGHTERS INHERITED H IS SHARE. THE APPELLANT IS THE GRANDDAUGHTER OF THE WIFE IN THIS CASE. IN 1971 PR ATAPSINH ENTERED INTO AN AGREEMENT WITH TATA POWER CO LTD TO SELL THE SAID PROPERTY SUBJECT TO THE ENCUMBRANCES AND OCCUPANTS. THE SALE WAS HOWEVER NO T CONSUMMATED AT THAT TIME. THE PRESENT DEED OF CONVEYANCE THEREFORE PORT S THE 5 VENDORS AS BE UNDISPUTED OWNERS OF THE SAID PROPERTY IN DIFFERENT IAL PERCENTAGE OF SHARE. SPECIFIC REFERENCE IS MADE TO PARA L OF THE SAID DEED WHICH MENTIONS AS UNDER ' SAVE AS ITA 3864/MUM/2016 MAITRI MORARJI ASSESSMENT YEAR : 2010 -11 AGREEMENT DATED 10/03/1971 WHEREIN THE POSSESSION O F THE LAND WAS DRAWN TO TH E FACT THAT VALUATION OF THE LAND AS PER REPORT DATED 27/01/200 9 OF AUTHORIZED REFLECTED UNDER THE INED THAT THE PROVISIONS OF FINALLY, ADOPTING THE DEEMED SALE CONSIDERATION AS RS.842.11 AS VALUE D BY DVO, THE WAS WORKED OUT AS RS.23.30 LACS WHICH AGGRIEVED, THE ASSESSEE AGITATED THE SAME WITHOUT A NY SUCCESS CIT(A) VIDE IMPUGNED ORDER DATED 29/02/2016 WHEREIN LD. FIRST APPELLATE AUTHORITY ADJUDICATED THE ISSUE BY OBSERVING AS UNDER: - T BY THE ASSESSING OFFICER AND THE CONTENTIONS OF THE APPELLATE. THE 2 MAIN ISSUES THA T EMERGE OUT OF THE DISCUSSION ABOVE ARE: 1) WHETHER THE DATE OF THE TRANSFER OF T HE SAID PROPERTY IS TO BE TAKEN AS TATA POWER CO LTD OR IS IT TO BE 2009 WHEN THE CONVEYANCE DEED HAS BEEN SIG NED BETWEEN THE 5 VENDORS (THE APPELLANT BEING ONE OF THE VENDORS) AND TATA P OWER CO. 2) FOR THE PURPOSE OF TERM CAPITAL GAIN IN THE HANDS OF THE APPELLANT WHETHER THE DATE OF ACQUISITION SHALL BE 1981 OR 2000, WHEN THE GRANDMOTHER OF THE APPELLANT TO APPRECIATE THE ISSUE IT IS IMPORTANT TO DELINEAT E THE FACT. FROM THE CONVEYANCE EMERGE ARE AS UNDER: THE DEED OF CONVEYANCE HAS BEE N MADE ON DECEMBER 2009 BETWEEN THE 5 VENDORS AND TATA POWER CO LTD BEING THE PURCHASER. THE DEED RECORDS THE FOLLOWING FACTS: RA TANSI MORARJI WA S THE ORIGINAL N 1959 AND BY VIRTUE OF HIS WILL HE LEFT THE SAID PROPERTY TO HIS WIFE AND 2 SONS, PRATAPSINH AN D DHAIRAYSINH. THE WIFE DIED IN 1968 AND BOTH THE SONS IN DATED HER SHARE ALSO. SUB SEQUENTLY DHIRAYSINH ALSO DIED IS SHARE. THE APPELLANT IS THE GRANDDAUGHTER OF THE WIFE IN THIS CASE. IN 1971 PR ATAPSINH ENTERED INTO AN AGREEMENT WITH TATA POWER CO LTD TO SELL THE SAID PROPERTY SUBJECT TO THE ENCUMBRANCES AND OCCUPANTS. THE SALE WAS HOWEVER NO T CONSUMMATED AT THAT TIME. THE PRESENT DEED OF CONVEYANCE THEREFORE PORT S THE 5 VENDORS AS BE UNDISPUTED OWNERS OF THE SAID PROPERTY IN DIFFERENT IAL PERCENTAGE OF SHARE. SPECIFIC REFERENCE IS MADE TO PARA L OF THE SAID DEED WHICH MENTIONS AS UNDER ' SAVE AS MENTIONED HEREIN A BOVE, THE VENDORS ARE THE ABSOLUTE OWNERS AND/OR WE LL AND SUFFICIENTLY ENTITLED TO THE PROPERTY AND THE TITLE OF THE VENDOR'S TO THE PROPERTY IS CLEAR, MARKETABLE AND FREE FROM ENCUMBRANCES, CLAIM S, DEMANDS OF ANY NATURE WHATSOEVER. PARA M OF THE SAID DEED CONTINUED TO STAND IN THE NAME OF RATANSI AND IT IS THE RESPONSIBILITY OF THE PURCHASER TO UPDATE AND MUTATE THE SAME......'. FUR THER IT IS SEEN THAT THE ENTIRE CONSIDERATION FOR THE PURCHASE IS PAGES 6 AND 7 OF THE SAID DEED. ON PARA 8 THE DEED AGAIN READS AS UNDER ' THE VENDORS HEREBY GRANT, SELL, CONVEY, TRANSFER AND AS SURED AS ON ' AS IS WHERE BASIS' ......... AGAIN OF SIGNIFICANCE ARE THE LAST VENDORS CONFIRM ON RECORD THAT AN EXECUTION OF THES E PRESENTS THE VENDORS HAVE PUT THE PURCHASER IN CONSTRUCTIVE POSSESSION OF THE PRO PERTY AS THE ABSOLUTE OWNERS THEREOF...'. FROM THE FACTS THEREFORE THAT EMERGE F ROM CASE OF THE APPELLANT THAT THE SAID PROPERTY STOOD TRANSFERRED IN 1971 WHEREIN AN AGREEMENT OF INTENT WAS SIGNED BETWEEN RATANSI AND THE TATA POWER CO LTD. THERE IS NOTHING TO EXHIBIT THAT CONDITIONS OF SECTION 2 (47) OF THE FULFILLED WHEREIN A DEEMED A TRANSFER COULD ALSO BE HELD IN THE FACTS AND CIRCUMSTANCES OF THE PRESENT CASE. THEREFORE I UPHO LD THE DECISION OF THE AO IN THIS REGARD THAT THE DATE OF TRANSFER OF THE SAID PROPER TY WOULD BE DECEMBER 200 THE DATE WHEN THE CONVEYANCE DEED IS ACTUALLY SIGNE D AND THE PROPERTY AS MENTIONED ABOVE GIVEN OVER IN CONSTRUCTIVE POSSESSI ON AND THE CONSIDERATION RECEIVED WITNESSING THE SAID TRANSFER. THE GROUND O F APPEAL IN THIS REGARD THEREFORE FALLS. AS REGARDS THE 2 ND GROUND WHICH PERTAINS TO THE DATE TO BE ADOPTED FOR PROVIDING FOR INDEXATION FOR THE PURPOSE OF CALCULATION OF CAPITA L GAIN IN THE HANDS OF THE APPELLANT, IT IS SEEN THAT FROM THE FACTS OF INHERITANCE AS EM ERGE ABOUT THE APPELLANT INHERITS THE SHARE FROM HER GRANDMOTHER WHO HAD INHERITED HER SHARE IN TURN ON THE DEMISE OF HER HUSBAND IN 1970. THE GRANDMOTHER DIED IN 200 7 AND THAT IS WHEN THE APPELLANT INHERITS HER SHARE. KEEPING IN VIEW THE P ROVISIONS OF SECTION 49 (1) WHICH DEFINES WHERE THE CAPITAL ASSET A WILL OR BY A SUCCESSION OR INHERITANCE, THEN THE COST OF ACQUISITION OF THE ASSET SHALL BE DEEMED TO BE THE COST FOR WHICH THE PREVIOUS OWN ER OF PROPERTY ACQUIRED IT, THEN IN THE PRESENT CASE IT WOULD B REFERENCE IS ALSO MADE TO THE 5 COMPUTATION FOR THE INDEXED COST OF ACQUISITION. IN THE PRESENT CASE THE DATE TO BE ADOPTED AS PER SUB PARA (III) OF THE THE AO IS ACCORDINGLY DIRECTED TO COMPUTE THE LONG THE APPELLANT. THE GROUNDS OF APPEAL ARE ACCORDINGL Y PARTLY ALLOWED. AGGRIEVED, THE ASSESSEE IS IN FURTHER APPEAL BEFORE US 4. THE LD. AUTHORIZED REPRESE K.GOPAL TAKING US THROUGH THE DOCUMENTS 4 ASSESSMENT YEAR : 2010 4 BOVE, THE VENDORS ARE THE ABSOLUTE OWNERS AND/OR WE LL AND SUFFICIENTLY ENTITLED TO THE PROPERTY AND THE TITLE OF THE VENDOR'S TO THE PROPERTY IS CLEAR, MARKETABLE AND FREE FROM ENCUMBRANCES, CLAIM S, DEMANDS OF ANY NATURE PARA M OF THE SAID DEED READS 'THE PROPERTY REGISTER CARDS RELATING TO THE PROPERTY CONTINUED TO STAND IN THE NAME OF RATANSI AND IT IS THE RESPONSIBILITY OF THE PURCHASER TO UPDATE AND MUTATE THE SAME......'. FUR THER IT IS SEEN THAT THE ENTIRE CONSIDERATION FOR THE PURCHASE IS GIVEN AS PER SCHEDULE TO THE DIFFERENT VENDORS ON PAGES 6 AND 7 OF THE SAID DEED. ON PARA 8 THE DEED AGAIN READS AS UNDER ' THE VENDORS HEREBY GRANT, SELL, CONVEY, TRANSFER AND AS SURED AS ON ' AS IS WHERE BASIS' ......... AGAIN OF SIGNIFICANCE ARE THE LAST 5 LINES ON PAGE 13 OF THE DEED ' THE VENDORS CONFIRM ON RECORD THAT AN EXECUTION OF THES E PRESENTS THE VENDORS HAVE PUT THE PURCHASER IN CONSTRUCTIVE POSSESSION OF THE PRO PERTY AS THE ABSOLUTE OWNERS THEREOF...'. FROM THE FACTS THEREFORE THAT EMERGE F ROM THE SAID DEED IT CANNOT BE THE CASE OF THE APPELLANT THAT THE SAID PROPERTY STOOD TRANSFERRED IN 1971 WHEREIN AN AGREEMENT OF INTENT WAS SIGNED BETWEEN RATANSI AND THE TATA POWER CO LTD. THERE IS NOTHING TO EXHIBIT THAT CONDITIONS OF SECTION 2 (47) OF THE IT ACT 1961 HAVE BEEN FULFILLED WHEREIN A DEEMED A TRANSFER COULD ALSO BE HELD IN THE FACTS AND CIRCUMSTANCES OF THE PRESENT CASE. THEREFORE I UPHO LD THE DECISION OF THE AO IN THIS REGARD THAT THE DATE OF TRANSFER OF THE SAID PROPER TY WOULD BE DECEMBER 200 THE DATE WHEN THE CONVEYANCE DEED IS ACTUALLY SIGNE D AND THE PROPERTY AS MENTIONED ABOVE GIVEN OVER IN CONSTRUCTIVE POSSESSI ON AND THE CONSIDERATION RECEIVED WITNESSING THE SAID TRANSFER. THE GROUND O F APPEAL IN THIS REGARD THEREFORE GROUND WHICH PERTAINS TO THE DATE TO BE ADOPTED FOR PROVIDING FOR INDEXATION FOR THE PURPOSE OF CALCULATION OF CAPITA L GAIN IN THE HANDS OF THE APPELLANT, IT IS SEEN THAT FROM THE FACTS OF INHERITANCE AS EM ERGE ABOUT THE APPELLANT INHERITS HER GRANDMOTHER WHO HAD INHERITED HER SHARE IN TURN ON THE DEMISE OF HER HUSBAND IN 1970. THE GRANDMOTHER DIED IN 200 7 AND THAT IS WHEN THE APPELLANT INHERITS HER SHARE. KEEPING IN VIEW THE P ROVISIONS OF SECTION 49 (1) WHICH DEFINES WHERE THE CAPITAL ASSET BECAME THE PROPERTY OF THE ASSESSEE EITHER THROUGH A WILL OR BY A SUCCESSION OR INHERITANCE, THEN THE COST OF ACQUISITION OF THE ASSET SHALL BE DEEMED TO BE THE COST FOR WHICH THE PREVIOUS OWN ER OF PROPERTY ACQUIRED IT, THEN IN THE PRESENT CASE IT WOULD B E THE COST TO THE GRANDMOTHER WHICH WOULD BE RELEVA NT. REFERENCE IS ALSO MADE TO THE 5 TH PROVISO OF SECTION 48 WHICH GIVES THE MODE OF COMPUTATION FOR THE INDEXED COST OF ACQUISITION. IN THE PRESENT CASE THE DATE TO BE ADOPTED AS PER SUB PARA (III) OF THE 5 TH PROVISO WOULD BE THE 1 THE AO IS ACCORDINGLY DIRECTED TO COMPUTE THE LONG - TERM CAPITAL GAIN IN THE HANDS OF THE APPELLANT. THE GROUNDS OF APPEAL ARE ACCORDINGL Y PARTLY ALLOWED. AGGRIEVED, THE ASSESSEE IS IN FURTHER APPEAL BEFORE US . THE LD. AUTHORIZED REPRESE NTATIVE FOR ASSESSEE [AR], TAKING US THROUGH THE DOCUMENTS , AGREEMENTS AND CONVEYANCE ITA 3864/MUM/2016 MAITRI MORARJI ASSESSMENT YEAR : 2010 -11 BOVE, THE VENDORS ARE THE ABSOLUTE OWNERS AND/OR WE LL AND SUFFICIENTLY ENTITLED TO THE PROPERTY AND THE TITLE OF THE VENDOR'S TO THE PROPERTY IS CLEAR, MARKETABLE AND FREE FROM ENCUMBRANCES, CLAIM S, DEMANDS OF ANY NATURE READS 'THE PROPERTY REGISTER CARDS RELATING TO THE PROPERTY CONTINUED TO STAND IN THE NAME OF RATANSI AND IT IS THE RESPONSIBILITY OF THE PURCHASER TO UPDATE AND MUTATE THE SAME......'. FUR THER IT IS SEEN THAT THE ENTIRE GIVEN AS PER SCHEDULE TO THE DIFFERENT VENDORS ON PAGES 6 AND 7 OF THE SAID DEED. ON PARA 8 THE DEED AGAIN READS AS UNDER ' THE VENDORS HEREBY GRANT, SELL, CONVEY, TRANSFER AND AS SURED AS ON ' AS IS WHERE 5 LINES ON PAGE 13 OF THE DEED ' THE VENDORS CONFIRM ON RECORD THAT AN EXECUTION OF THES E PRESENTS THE VENDORS HAVE PUT THE PURCHASER IN CONSTRUCTIVE POSSESSION OF THE PRO PERTY AS THE ABSOLUTE OWNERS THE SAID DEED IT CANNOT BE THE CASE OF THE APPELLANT THAT THE SAID PROPERTY STOOD TRANSFERRED IN 1971 WHEREIN AN AGREEMENT OF INTENT WAS SIGNED BETWEEN RATANSI AND THE TATA POWER CO LTD. THERE IT ACT 1961 HAVE BEEN FULFILLED WHEREIN A DEEMED A TRANSFER COULD ALSO BE HELD IN THE FACTS AND CIRCUMSTANCES OF THE PRESENT CASE. THEREFORE I UPHO LD THE DECISION OF THE AO IN THIS REGARD THAT THE DATE OF TRANSFER OF THE SAID PROPER TY WOULD BE DECEMBER 200 9 BEING THE DATE WHEN THE CONVEYANCE DEED IS ACTUALLY SIGNE D AND THE PROPERTY AS MENTIONED ABOVE GIVEN OVER IN CONSTRUCTIVE POSSESSI ON AND THE CONSIDERATION RECEIVED WITNESSING THE SAID TRANSFER. THE GROUND O F APPEAL IN THIS REGARD THEREFORE GROUND WHICH PERTAINS TO THE DATE TO BE ADOPTED FOR PROVIDING FOR INDEXATION FOR THE PURPOSE OF CALCULATION OF CAPITA L GAIN IN THE HANDS OF THE APPELLANT, IT IS SEEN THAT FROM THE FACTS OF INHERITANCE AS EM ERGE ABOUT THE APPELLANT INHERITS HER GRANDMOTHER WHO HAD INHERITED HER SHARE IN TURN ON THE DEMISE OF HER HUSBAND IN 1970. THE GRANDMOTHER DIED IN 200 7 AND THAT IS WHEN THE APPELLANT INHERITS HER SHARE. KEEPING IN VIEW THE P ROVISIONS OF SECTION 49 (1) WHICH BECAME THE PROPERTY OF THE ASSESSEE EITHER THROUGH A WILL OR BY A SUCCESSION OR INHERITANCE, THEN THE COST OF ACQUISITION OF THE ASSET SHALL BE DEEMED TO BE THE COST FOR WHICH THE PREVIOUS OWN ER OF PROPERTY ACQUIRED IT, THEN E THE COST TO THE GRANDMOTHER WHICH WOULD BE RELEVA NT. PROVISO OF SECTION 48 WHICH GIVES THE MODE OF COMPUTATION FOR THE INDEXED COST OF ACQUISITION. IN THE PRESENT CASE THE DATE TO BE PROVISO WOULD BE THE 1 ST DAY OF APRIL 1981. TERM CAPITAL GAIN IN THE HANDS OF THE APPELLANT. THE GROUNDS OF APPEAL ARE ACCORDINGL Y PARTLY ALLOWED. NTATIVE FOR ASSESSEE [AR], SHRI , AGREEMENTS AND CONVEYANCE DEED AS PLACED IN THE PAPER HAVE BEEN TRANSFERRED BY THE ASSESSEE AS NOMINEE / L TRANSFEROR SINCE, THE PROPERTY, IN SUBSTANCE, WAS A 1971 WHEN THE POSSESSION WAS ALSO HANDED OVER TO TH E BUYER. THE LD. AR FURTHER SUBMITTED THAT THE PROVISIONS OF SECTION 50C COULD NOT BE APPLIED TO THE GIVEN FACTS BUILDING AS ENVISAGED BY SECTION 50C RIGHTS IN FAVOR OF THE BUYER WHO HAD ALREADY PROPERTY WAY BACK IN 1971. [DR], SHRI MANOJ KUMAR SINGH CONTRADICTING HERSELF SINCE ON ONE HAND, THE PROPER TY IS STATED TO BE SOLD IN THE YEAR 1971 WHEREAS ON THE OTHER HAND, THE ASS ESSEE HAS ADOPTED THE COST OF ACQUISIT ION AS ON 01/04/1981 TO WORK OUT THE RESULTANT GAIN S. 5.1 WE HAVE CAREFULLY HEARD THE RIVAL SUBMISSIONS AND P ERUSED RELEVANT MATERIAL ON RECORD INCLUDING DOCUMENTS PLA CED IN THE BOOK. THE PERUSAL OF AGREEMENT DATED 10/03/1971 AS PLACED ON RECORD REVEAL THAT ONE SHRI PRATAPSINH R.MORARJI TATA HYDRO ELECTRIC POWER SUPPLY COMPANY LIMITED LAND UNDER QUESTION FOR A SALE CONSIDERATION OF RS. 34,937/ APPROX. AREA OF 4991 SQUARE YARDS @ RS.7/ OF THE CONSIDERATION WAS PAYABLE AS EARNEST MONEY, 50% WAS PAYABLE UPON HANDING OVER THE FORMAL POSSESSION WHEREAS THE BALANCE 40% WAS PAYABLE UPON COMPLETION OF SALE. BE COMPLETED WITHIN A PERIO THE CONTRACT. PURSUANT TO THE SAME, THE POSSESSION OF THE LAND WAS 5 ASSESSMENT YEAR : 2010 5 PAPER -BOOK SUBMITTED THAT ONLY THE RESIDUARY RIGHTS HAVE BEEN TRANSFERRED BY THE ASSESSEE AS NOMINEE / L TRANSFEROR SINCE, THE PROPERTY, IN SUBSTANCE, WAS A LREADY SOLD IN THE YEAR 1971 WHEN THE POSSESSION WAS ALSO HANDED OVER TO TH E BUYER. THE LD. AR FURTHER SUBMITTED THAT THE PROVISIONS OF SECTION 50C COULD NOT BE GIVEN FACTS SINCE THERE WAS NO TRANSFER OF ANY LAND OR BUILDING AS ENVISAGED BY SECTION 50C BUT IT WAS MERE CONVEYANCE OF RIGHTS IN FAVOR OF THE BUYER WHO HAD ALREADY ACQUIRED THE INTEREST IN THE PROPERTY WAY BACK IN 1971. PER CONTRA, LD. DEPARTMENTAL REPRESENTATIVE SHRI MANOJ KUMAR SINGH SUBMITTED THAT THE ASSESSEE IS CONTRADICTING HERSELF SINCE ON ONE HAND, THE PROPER TY IS STATED TO BE SOLD IN THE YEAR 1971 WHEREAS ON THE OTHER HAND, THE ASS ESSEE HAS ADOPTED ION AS ON 01/04/1981 TO WORK OUT THE RESULTANT GAIN S. WE HAVE CAREFULLY HEARD THE RIVAL SUBMISSIONS AND P ERUSED RELEVANT MATERIAL ON RECORD INCLUDING DOCUMENTS PLA CED IN THE THE PERUSAL OF AGREEMENT DATED 10/03/1971 AS PLACED ON RECORD SHRI PRATAPSINH R.MORARJI ENTERED INTO AN TATA HYDRO ELECTRIC POWER SUPPLY COMPANY LIMITED [THPCL] LAND UNDER QUESTION FOR A SALE CONSIDERATION OF RS. 34,937/ 4991 SQUARE YARDS @ RS.7/ - PER SQUARE YARD. OF THE CONSIDERATION WAS PAYABLE AS EARNEST MONEY, 50% WAS PAYABLE UPON HANDING OVER THE FORMAL POSSESSION WHEREAS THE BALANCE 40% WAS PAYABLE UPON COMPLETION OF SALE. AS PER THE TERMS, THE BE COMPLETED WITHIN A PERIO D OF FOUR MONTHS, TIME BEING THE ESSENCE OF THE CONTRACT. PURSUANT TO THE SAME, THE POSSESSION OF THE LAND WAS ITA 3864/MUM/2016 MAITRI MORARJI ASSESSMENT YEAR : 2010 -11 SUBMITTED THAT ONLY THE RESIDUARY RIGHTS HAVE BEEN TRANSFERRED BY THE ASSESSEE AS NOMINEE / L EGAL HEIR OF THE LREADY SOLD IN THE YEAR 1971 WHEN THE POSSESSION WAS ALSO HANDED OVER TO TH E BUYER. THE LD. AR FURTHER SUBMITTED THAT THE PROVISIONS OF SECTION 50C COULD NOT BE SINCE THERE WAS NO TRANSFER OF ANY LAND OR BUT IT WAS MERE CONVEYANCE OF ACQUIRED THE INTEREST IN THE LD. DEPARTMENTAL REPRESENTATIVE SUBMITTED THAT THE ASSESSEE IS CONTRADICTING HERSELF SINCE ON ONE HAND, THE PROPER TY IS STATED TO BE SOLD IN THE YEAR 1971 WHEREAS ON THE OTHER HAND, THE ASS ESSEE HAS ADOPTED ION AS ON 01/04/1981 TO WORK OUT THE RESULTANT GAIN S. WE HAVE CAREFULLY HEARD THE RIVAL SUBMISSIONS AND P ERUSED RELEVANT MATERIAL ON RECORD INCLUDING DOCUMENTS PLA CED IN THE PAPER- THE PERUSAL OF AGREEMENT DATED 10/03/1971 AS PLACED ON RECORD AN AGREEMENT WITH [THPCL] FOR SALE OF LAND UNDER QUESTION FOR A SALE CONSIDERATION OF RS. 34,937/ - COMPUTED AT SQUARE YARD. THE 10% OF THE CONSIDERATION WAS PAYABLE AS EARNEST MONEY, 50% WAS PAYABLE UPON HANDING OVER THE FORMAL POSSESSION WHEREAS THE BALANCE 40% WAS AS PER THE TERMS, THE SAID SALE WAS TO D OF FOUR MONTHS, TIME BEING THE ESSENCE OF THE CONTRACT. PURSUANT TO THE SAME, THE POSSESSION OF THE LAND WAS HANDED OVER TO THE BUYER ON THE SAME DATE WHICH IS EVIDENCED BY POSSESSION RECEIPT AS PLACED ON RECORD. 5.2 THE DEED OF CONVEYANCE WITH RESPECT TO THIS PROPERT Y HAS BEEN EXECUTED IN FAVOR OF THCPL VENDORS INCLUDING THE ASSESSEE. THE RECITAL CHRONOLOGY OF EVENTS TH INTEREST IN THE SAID PROPERTY. ASSESSEE HAS GOT INTEREST IN THE SAID PROPERTY TO THE EXTENT OF 1/12 THE SAID INTEREST HAS BEEN ACQUIRED AS EXECUTOR OF SMT. CHANDRAVELI , WHO, IN TU HER FATHER SHRI DHAIRYASINH SH. DHAIRYASINH WAS JOINT OWNER WITH HIMSELF AS WELL AS BEHALF OF OTHER OWNERS, ENTERED INTO AGREEMENT FOR SALE DATED 10/03/1971 WITH THE AFORESAID PROPERTY INHERITANC E. THE RECITAL DATED 10/03/1971 AS ENTERED INTO BY WHEREAS CLAUSE-G CONFIRM THE FACT THAT THE SALE COULD NOT BE CONSUMMATED AT THAT TIME. THE PROPERTY CONTINUES TO BE OCCUPIED BY HUTMENT DW ELLERS / TRESPASSERS WHO HAD CONSTRUCTED VARIOUS STRUCTURES ON THE PROPE RTY. HAS AGREED TO ACQUIRE THE PROPERTY ON VENDORS HAVE PUT THE PURCHASER PROPERTY. 6 ASSESSMENT YEAR : 2010 6 HANDED OVER TO THE BUYER ON THE SAME DATE WHICH IS EVIDENCED BY POSSESSION RECEIPT AS PLACED ON RECORD. THE DEED OF CONVEYANCE WITH RESPECT TO THIS PROPERT Y HAS BEEN THCPL ON 31/12/2009 WHICH IS EXECUTED BY VENDORS INCLUDING THE ASSESSEE. THE RECITAL S OF THE SAID DEED CONTAIN CHRONOLOGY OF EVENTS TH R OUGH WHICH THE FIVE VENDORS A INTEREST IN THE SAID PROPERTY. THE PERUSAL OF THE SAME REVEAL THAT THE HAS GOT INTEREST IN THE SAID PROPERTY TO THE EXTENT OF 1/12 THE SAID INTEREST HAS BEEN ACQUIRED AS EXECUTOR OF WILL OF HER MOTHER , WHO, IN TU RN, ACQUIRED THE INTEREST IN THE PROPERTY FROM SHRI DHAIRYASINH . THE PERUSAL OF THE RECITAL FURTHER REVEAL WAS JOINT OWNER WITH PRAKASHSINH WHO, ON BEHALF OF HIMSELF AS WELL AS BEHALF OF OTHER OWNERS, ENTERED INTO AGREEMENT FOR SALE DATED 10/03/1971 WITH THPCL. IN OTHER WORDS, IT IS UNDISPUTED FACT THE AFORESAID PROPERTY WAS ACQUIRED BY THE ASSESSEE E. THE RECITAL CLAUSE-F MAKES A REFERENCE TO THE AGREEMENT DATED 10/03/1971 AS ENTERED INTO BY PRATAPSINH WITH THE CONFIRM THE FACT THAT THE SALE COULD NOT BE CONSUMMATED AT THAT TIME. THE PERUSAL OF CLAUSE-K AFFIRMS THE PROPERTY CONTINUES TO BE OCCUPIED BY HUTMENT DW ELLERS / TRESPASSERS WHO HAD CONSTRUCTED VARIOUS STRUCTURES ON THE PROPE RTY. HAS AGREED TO ACQUIRE THE PROPERTY ON AS IS WHERE I S VENDORS HAVE PUT THE PURCHASER IN CONSTRUCTION POSSESSION OF THE ITA 3864/MUM/2016 MAITRI MORARJI ASSESSMENT YEAR : 2010 -11 HANDED OVER TO THE BUYER ON THE SAME DATE WHICH IS EVIDENCED BY THE DEED OF CONVEYANCE WITH RESPECT TO THIS PROPERT Y HAS BEEN ON 31/12/2009 WHICH IS EXECUTED BY FIVE OF THE SAID DEED CONTAIN THE OUGH WHICH THE FIVE VENDORS A CQUIRED THE THE PERUSAL OF THE SAME REVEAL THAT THE HAS GOT INTEREST IN THE SAID PROPERTY TO THE EXTENT OF 1/12 TH AND WILL OF HER MOTHER RN, ACQUIRED THE INTEREST IN THE PROPERTY FROM THE PERUSAL OF THE RECITAL FURTHER REVEAL S THAT WHO, ON BEHALF OF HIMSELF AS WELL AS BEHALF OF OTHER OWNERS, ENTERED INTO AGREEMENT FOR IN OTHER WORDS, IT IS UNDISPUTED FACT WAS ACQUIRED BY THE ASSESSEE THROUGH A REFERENCE TO THE AGREEMENT WITH THE PURCHASER CONFIRM THE FACT THAT THE SALE COULD NOT BE AFFIRMS THE FACT THAT THE PROPERTY CONTINUES TO BE OCCUPIED BY HUTMENT DW ELLERS / TRESPASSERS WHO HAD CONSTRUCTED VARIOUS STRUCTURES ON THE PROPE RTY. THE PURCHASER S BASIS AND THE IN CONSTRUCTION POSSESSION OF THE 5.3 THE CAREFUL CONSIDERATION OF THE ABOVE FACTUAL MATR IX LEAD US TO FORM AN OPINION THAT THE CONVEYANCE DEED AS EXECUTE D BETWEEN THE VENDORS AND THPCL WAS INEXTRICABLY LINK 10/03/1971 . THE PURCHASER PROPERTY IN THE YEAR 1971 WHEN THE POSSESSION WAS A LSO HANDED OVER BY THE SELLER ACTING FOR HIMSELF AS WELL FOR OTHER OWNERS SELLER HAD ALREADY TRANSFERRED SAID PROPERTY IN FAVOR OF THE PURCHASER SALE AGREEMENT AS WELL AS BY HANDING OVER THE POSSE SSION OF THE PROPERTY. THEREFORE, THE IN THE AFORESAID PROPERT Y CONVEYANCE DEED WAS ONE OF THE RIGHT ATTACHED TO TH E PROPERTY WHICH HAS BEEN TRANSFERRED BY THE ASSESSEE IN FAVOR OF TH E PURCHASER AGAINST CERTAIN CONSIDERATION AND THEREFORE, THE SAME COULD NOT BE ATTRIBUTED TOWARDS SALE OF LAND AS CONCLUDED BY LOWER AUTHORIT IES. THE ASSESSEE HAD RECEIVED COMPENSATION AGAINST SALE OF RESIDUARY RIGHTS IN THE SAID PROPERTY. THIS BEING THE CASE, HAD NO APPLICABILITY TO THE FACTS OF THE CASE. 5.4 HAVING REACHED AFORESAID CONCLUSION, OPINION THAT THE COST OF ACQUISITION OF THE SAID RI GHT IN THE HAND OF THE ASSESSEE WAS TO BE TAKEN AS ACQUIRED BY THE OWNER WAY BACK IN 1966 AND THE SAME WAS OWNER IN THE YEAR 1971 AND IT WAS THAT TIME WHEN TH E BENEFIT OF COST ACQUISITION WAS AVAILABLE TO THE SELLER. 7 ASSESSMENT YEAR : 2010 7 THE CAREFUL CONSIDERATION OF THE ABOVE FACTUAL MATR IX LEAD US TO FORM AN OPINION THAT THE CONVEYANCE DEED AS EXECUTE D BETWEEN THE WAS INEXTRICABLY LINK ED WITH SALE AGREEMENT DATED . THE PURCHASER HAD ACQUIRED CERTAIN RIGHTS IN THE SAID PROPERTY IN THE YEAR 1971 WHEN THE POSSESSION WAS A LSO HANDED OVER BY FOR HIMSELF AS WELL FOR OTHER OWNERS . IN OTHER WORDS, SELLER HAD ALREADY TRANSFERRED CERTAIN RIGHT S OUT OF BUNDLE OF RIGHTS IN FAVOR OF THE PURCHASER IN THE YEAR 1971 SALE AGREEMENT AS WELL AS BY HANDING OVER THE POSSE SSION OF THE THEREFORE, THE ASSESSEE HAD INHERITED ONLY THE Y AND NOT AN ABSOLUTE OWNER OF THE PROPERTY. CONVEYANCE DEED WAS ONE OF THE RIGHT ATTACHED TO TH E PROPERTY WHICH HAS BEEN TRANSFERRED BY THE ASSESSEE IN FAVOR OF TH E PURCHASER AGAINST AND THEREFORE, THE SAME COULD NOT BE ATTRIBUTED TOWARDS SALE OF LAND AS CONCLUDED BY LOWER AUTHORIT IES. THE ASSESSEE HAD RECEIVED COMPENSATION AGAINST SALE OF RESIDUARY RIGHTS THIS BEING THE CASE, THE PROVISIONS OF SE HAD NO APPLICABILITY TO THE FACTS OF THE CASE. HAVING REACHED AFORESAID CONCLUSION, WE ARE OF THE CONSIDERED OPINION THAT THE COST OF ACQUISITION OF THE SAID RI GHT IN THE HAND OF THE ASSESSEE WAS TO BE TAKEN AS NIL SINCE THE PROPERTY UNDER Q ACQUIRED BY THE OWNER WAY BACK IN 1966 AND THE SAME WAS OWNER IN THE YEAR 1971 AND IT WAS THAT TIME WHEN TH E BENEFIT OF COST WAS AVAILABLE TO THE SELLER. ITA 3864/MUM/2016 MAITRI MORARJI ASSESSMENT YEAR : 2010 -11 THE CAREFUL CONSIDERATION OF THE ABOVE FACTUAL MATR IX LEAD US TO FORM AN OPINION THAT THE CONVEYANCE DEED AS EXECUTE D BETWEEN THE AGREEMENT DATED ACQUIRED CERTAIN RIGHTS IN THE SAID PROPERTY IN THE YEAR 1971 WHEN THE POSSESSION WAS A LSO HANDED OVER BY IN OTHER WORDS, THE S OUT OF BUNDLE OF RIGHTS IN THE IN THE YEAR 1971 BY ENTERING INTO SALE AGREEMENT AS WELL AS BY HANDING OVER THE POSSE SSION OF THE THE REMAINING RIGHTS OF THE PROPERTY. THE CONVEYANCE DEED WAS ONE OF THE RIGHT ATTACHED TO TH E PROPERTY WHICH HAS BEEN TRANSFERRED BY THE ASSESSEE IN FAVOR OF TH E PURCHASER AGAINST AND THEREFORE, THE SAME COULD NOT BE ATTRIBUTED TOWARDS SALE OF LAND AS CONCLUDED BY LOWER AUTHORIT IES. IN OTHER WORDS, THE ASSESSEE HAD RECEIVED COMPENSATION AGAINST SALE OF RESIDUARY RIGHTS THE PROVISIONS OF SE CTION 50C WE ARE OF THE CONSIDERED OPINION THAT THE COST OF ACQUISITION OF THE SAID RI GHT IN THE HAND OF THE PROPERTY UNDER Q UESTION WAS ACQUIRED BY THE OWNER WAY BACK IN 1966 AND THE SAME WAS SOLD BY THE OWNER IN THE YEAR 1971 AND IT WAS THAT TIME WHEN TH E BENEFIT OF COST OF 5.5 IN NUTSHELL, WE HOLD THAT THE YEAR WAS RS.52,56,200/ THE ASSESSEE UPON CONVEYANCE. NOT AVAILABLE TO THE ASSESSEE. THE LD. AO IS DIRECT ED TO RECOMPUTE THE INCOME OF THE ASSESSEE IN TERMS OF OUR 6. THE APPEAL STANDS PARTLY ALLOWED IN TERMS OF OUR AB OVE ORDER. ORDER PRONOUNCED IN THE OPEN COURT SD/- (PAWAN SINGH ) #! $% / JUDICIAL MEMBER + MUMBAI; !$ DATED : 05/ 1 SR.PS:- JAISY VARGHESE ! COPY OF THE ORDER FORWARDED TO 1. / THE APPELLANT 2. &' / THE RESPONDENT 3. , / THE CIT(A) 4. , / CIT CONCERNED 5. !-.&!(!!/ !/ 6. .012 GUARD FILE 8 ASSESSMENT YEAR : 2010 8 WE HOLD THAT THE LTCG EARNED BY THE ASSESSEE THE YEAR WAS RS.52,56,200/ - , BEING NET SALE CONSIDERATION RECEIVED BY THE ASSESSEE UPON CONVEYANCE. THE BENEFIT OF COST OF ACQUISITION WAS NOT AVAILABLE TO THE ASSESSEE. THE LD. AO IS DIRECT ED TO RECOMPUTE THE INCOME OF THE ASSESSEE IN TERMS OF OUR ABOVE ORDER. THE APPEAL STANDS PARTLY ALLOWED IN TERMS OF OUR AB OVE ORDER. ORDER PRONOUNCED IN THE OPEN COURT ON 05 TH DECE M SD/- ) (MANOJ KUMAR JUDICIAL MEMBER $% / ACCOUNTANT MEMBER 1 2/2018 COPY OF THE ORDER FORWARDED TO : / THE CIT(A) CONCERNED !/ + / DR, ITAT, MUMBAI ' # '$% ITA 3864/MUM/2016 MAITRI MORARJI ASSESSMENT YEAR : 2010 -11 EARNED BY THE ASSESSEE DURING , BEING NET SALE CONSIDERATION RECEIVED BY THE BENEFIT OF COST OF ACQUISITION WAS NOT AVAILABLE TO THE ASSESSEE. THE LD. AO IS DIRECT ED TO RECOMPUTE THE THE APPEAL STANDS PARTLY ALLOWED IN TERMS OF OUR AB OVE ORDER. M BER, 2018. (MANOJ KUMAR AGGARWAL) ACCOUNTANT MEMBER ' / BY ORDER, '$% (DY./ASSTT.REGISTRAR) + / ITAT, MUMBAI.