Case Law Details
ACIT Vs Sandeep U Mehta (ITAT Mumbai)
Conclusion:
Assessee was entitled to exemption under section 54 on long term capital gain on sale of properties as the holding period of the asset should be considered from the date of acquisition of asset in the light of agreement to sale, but not from the date of possession of the property.
Held:
Assessee had computed long term capital gain from sale of two properties by adopting indexed cost of acquisition and claimed exemption u/s 54 for purchase of another residential house property. AO had recomputed long term capital gain derived from sale of one residential property for the reason that the holding period of the asset was less than 3 years if the date of possession of the property had been considered. It was held various Courts had consistently held that the holding period of the asset should be considered from the date of acquisition of asset in the light of agreement to sale, but not from the date of possession of the property. In this case, if the date of acquisition of the property had been taken from the date of agreement to sale, then the holding period of the asset was more than 36 months and consequent gain arising from sale of property was assessable under the head ‘long term capital gain’. Assessee had filed various details including copy of document evidencing purchase of another residential house property within one year before the date of sale of immovable property under consideration and hence, the long term capital gain was exempt u/s 54.
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