ITAT upheld deletion, and long term capital loss from transfer of land
ITAT upheld deletion, and long term capital loss from transfer of land
Assessee company was a tea producer. It had land which was acquired 40 years ago for Rs 16 lacs, which it sold for sale consideration of 2.62 crores. Profit on sale of land was shown as income in the accounts. AO treated such profit as income from other sources. CIT(A) directed AO to delete the addition of Rs 2,46,00,000, and treat Rs 50,00,210 as long term capital loss arising from transfer of land. ITAT confirmed CIT(A)’s order.-501309
1. The assessee company was in the business of growing and manufacturing of tea. Assessee during the previous year i.e., in June, 2005, sold a piece of land with a temporary structure, which was adjacent to its registered office for a sale consideration of 2.62 crores. The Assessee had acquired the property in question about 40 years back for Rs.16 lacs. The profit on sale of the property was shown as income in the accounts. The AO treated by his order passed u/s.143(3) held such profit as Income from Other Sources.
2. CIT(A) directed the AO to delete the addition of Rs.2,46,00,000 from Income from Other Sources and treat Rs.50,00,210 as long term capital loss arising from transfer of land.
3. On appeal, the ITAT held as under:
4. We are of the view that the stand taken by the revenue in the grounds of appeal is unsustainable.From the grounds of appeal raised by the revenue it is clear that the revenue has not dispute any of the findings of the CIT(A) except harping on the point that the purchaser of the property did not confirm the details of the transactions as given by the Assessee. The sale deed of the property dated 14.06.2005 is a registered documents. The authenticity of the same cannot be doubted. The fact that the purchaser of the property did not respond to the notices issued by the AO cannot be the basis to treat the gain in question as income from other sources. The AO has not brought any material on record about the value of the property as adopted for the purpose of registration of documents by the Registrar of Assurances. In the given facts and circumstances we are of the view that conclusions drawn by the CIT(A) do not call for any interference . Accordingly order of CIT(A) is confirmed and this appeal by the revenue is dismissed.”
Case Reference - A.C.I.T., Circle-4, -versus- M/s.Sree Kamakhya Tea Co.Pvt.Ltd.
IN THE INCOME TAX APPELLATE TRIBUNAL, BENCH 'A' KOLKATA
[Before Hon'ble Shri N.V.Vasudevan, JM & Shri M.Balaganesh, AM ]
ITA No.555/Kol/2012
Assessment Year : 2006-07
