Case Law Details
Pradeep Bansal Vs ACIT (ITAT Delhi)
ITAT Delhi held that once long term capital gain along with cost of acquisition and indexation accepted in the hands of one of the co-owner of the property, the same needs to be allowed/ accepted for other co-owner of the property too.
Facts- The assessee is an individual who filed his return declaring total income of Rs.60,24,620/- comprising of long term capital gains of Rs.59,10,401/- and income from other sources at Rs.1,24,222/-. AO in the draft assessment order passed u/s. 144C of the Act dated 29.09.2021 denied long term capital gain claimed by the assessee in the absence of copy of purchase deed of the property, bills, vouchers, etc. to prove the cost of improvement as the assessee did not furnish the details as called for by AO. The long term capital gain declared by the assessee at Rs.59,10,401/- was denied and AO computed the long term capital gain at Rs.1,13,39,599/- on the sale of property. Accordingly a draft assessment order was passed.
The assessee filed his objections before the DRP along with various details. The DRP felt that all these evidences have to be examined by AO and accordingly direction was given to AO to compute the capital gain. However, the DRP observed that since the floors came into existence in the FY 2018-19 and were so within the same financial year the transaction is of the nature of short term capital gain and not long term capital gain. The DRP held that in such situation indexation is not allowable.
On the directions of the DRP, AO passed final assessment order, wherein AO examined all the evidences furnished and accepted the claim of the assessee in respect of cost of improvement and cost of acquisition. However, AO computed the short term capital gain on the sale of property both land and building under the head “short term capital gain” at Rs.1,03,01,202/- without allowing indexation.
Please become a Premium member. If you are already a Premium member, login here to access the full content.
Author Bio
