Case Law Details
Case Name : Chiranjeev Lal Khanna Vs. ITO (ITAT Mumbai)
Appeal Number : (ITA No. 6170/Mum/2008)
Date of Judgement/Order : 13/04/2011
Related Assessment Year : 2005- 2006
Courts :
All ITAT ITAT Mumbai
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The owners granting the right, authority and power to develop the property in favour of the developers is considered as transfer of the land and building and thus liable to capital gain tax and section 50C of the Act is applicable
Recently ITAT Mumbai held that in the case of Chiranjeev Lal Khanna Vs. ITO (ITA No. 6170/Mum/2008) held that considering the facts of the case and clauses in the agreement, the taxpayer has transferred land and building to the developer would be chargeable to tax as capital gains. Accordingly, Section 50C of the Income-tax Act, 196 1(the Act) would be applicable.
Facts of the case
- The taxpayer and his wife jointly owned building along with plot of land ad measuring 840 sq.mts. i.e. 1,005 sq.yards. The owners entered into agreement with the developers to demolish the existing building and redevelop the said land into a new building on 50 percent sharing basis based on the terms and conditions set out in the agreement.
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