ITAT confirmed AO's action in adopting value of property as per s 50C

1. Smt Elsa Silva filed her return of income at Rs 1.4 lakh.

2. In the course of assessment AO observed that assessee alongwith others, had sold development rights of a property for a consideration of Rs 4.4 crores.

3. Assessee computed Long Term Capital Gain (LTCG) at NIL in respect of her share of consideration of Rs 2.7 crores.

4. AO did not accept the computation of LTCG on saleof the said property as submitted by the assessee and proceeded to re-work the assessee's LTCG at Rs 3 crores.

5. CIT(A) upheld the AO's action in adopting the value of said property at Rs 4.6 crores as per s 50C.

The ITAT on appeal, held as under:

6. Respectfully following the decision of the Hon'ble Bombay High Court in the case of Manjula J. Shah (supra), we uphold the order of the Ld. CIT(A) in directing the Assessing Officer to adopt the cost inflation index of the acquisition of the capital asset with reference to the year in which the previous owner first held the asset i.e. w.e.f. 1/4/1981 for the purpose of computation of the LTCG of the assessee in respect of the transfer of the said property.

Case Reference - The Income Tax Officer Vs. Smt. Elsa Silva.

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH "J", MUMBAI

BEORE SHRI JASON P. BOAZ ACCOUNTANT MEMBER

AND SHRI RAM LAL NEGI, JUDICIAL MEMBER

ITA No. 1976/MUM/2011

(Assessment Year : 2007-08)