Case Law Details
Property in question was admittedly a depreciable asset and therefore came within the ambit of section 50 of the Income Tax Act, 1961 when the sale proceeds exceeded the opening WDV of the building block. At the same we also note that the property in question was acquired by the assessee in March 1956 and therefore its character was long term in nature. Section 50 is the special provision for computation of capital gain in case of depreciable assets and the deeming provision of section 50 is only for the purpose of section 48 & 49 relatable to computation of taxable gain and not for other purposes. Since the capital asset in question was held for a period exceeding three years, it was in the nature of long term capital asset and, therefore, gain realized on transfer of long term capital asset is qualified for concessional tax rate provided in section 112 of the Act. We note that identical issue was adjudicated by the Tribunal (Mumbai) Benches in the case of Smita Conductors Ltd. v. DCIT (2015) 152 ITD 417 (Mumbai – Trib.) and also in the case of Poddar Brothers & Investment (P) Ltd. v. DCIT, ITA No. 1114/Mum/2013 and the interpretation of the provisions of sections 48, 49 and 50 and section 112 was considered and the view expressed by the Tribunal has been followed by the learned Commissioner (Appeals) to give relief to the assessee. The learned Department Representative could not controvert the finding of the Learned Commissioner (Appeals) by producing any material before us or any other precedent to upset the decision relied on by the learned Commissioner (Appeals), therefore, we find no infirmity in the order of learned Commissioner (Appeals) and the same is hereby upheld.
FULL TEXT OF THE ITAT ORDER IS AS FOLLOWS:-
This is an appeal filed by the revenue against the order of learned Commissioner (A)-9, Kolkata dated 24-11-2015 for assessment year 2006-07.
2. Ground no. 1 of revenue’s appeal reads as under: —
“1. That on the facts and in the circumstances of the case, the Learned Commissioner (Appeals) has erred in allowing loss of Rs. 534.58 lakh due to exchange fluctuation on foreign currency working capital loan on account of its restatement at the end of the year when such loss would not affect the day to day working or profit for the year of the assessee.”
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