ITR of AY 1971-72 Closed After the Correct Assessment Given by SC

Is capital gain suitable for the consideration of procured land in the 1970s? Yes, it is. Endorsing the Income Tax Department’s judgment for filing the return in the assessment year 1971-72 in 2020. The supreme court for refusing the petition upon the applicability of capital gains tax in the case which had begun in 1970.

A section of property in Ambala became a danger property after its owner moved to Pakistan and it was assigned to Amrik Singh the assessee, who is no more to which his son has filed the appellant in the case who had relocated to India, who left his home in Pakistan. Later he received the compensation including the interest as declared that land was carried over for the public purpose.

Justice AM Khanwilkar, Justice Hemant Gupta and Justice Dinesh Maheswari the three-judge board gave its ruling. The conflict is basically concerned with the charge of tax for capital gains resulting out of the honour of consideration towards the purchase of land relating to the assessee.

“We have not an iota of doubt that in the second round of proceeding, the AO (Assessing officer) had rightly assessed the tax liability of the appellant, on long-term capital gains arising on account of the acquisition, on the basis of the amount of compensation allowed in the award dated 29.09.1970 as also the enhanced amount of compensation accrued finally to the appellant; and as regards interest income, had rightly made protective assessment on an accrual basis,”

During the assessment year 1971-1972, the assessee had stated income at ₹1,408 including ₹408 from the property and ₹1,000 denoting the value of the interest received as an award. While not receiving the benefits so stated, the AO in his evaluation order recorded February 12, 1982, intensified the income from the property to ₹1,200 and additionally magnified the interest income to ₹11,596 with reference to the interest earned beneath the award.

Concerning the house, the property was cancelled in the primary part of the application. But the appellate jurisdiction discovered that the person was paid ₹62,550 as compensation and ₹9,532 as consideration and yet, capital gains on this tale did not have imposed tax by the AO. Respond to show cause notice by the person was rejected and ₹23,146 was enumerated as capital gain tax. This grew into dispute and confrontation at multiple levels.

The Founder and Managing Partner at DVS Advisors Mr Divakar Vijayasarathy, speaks that the present position of the Income Tax Act Get to know complete guide of TDS provisions under income tax act 1961 at here. Also, we include several topics as TDS returns, TDS due dates, penalty & more. Read more, 1961 is that the capital gain on compulsory redemption of the asset is payable in the year for which the 1st instalment of the return is earned. Through the Finance Act, 1991 the plan was initiated with the reflective outcome from 1988. The inspection is according to the year of transfer of a capital asset that has been urgently taken in the pre-1988 era as it was chargeable in the year of transfer as per the erstwhile procurements. although, the inspections could still have significance since the indexation privilege is granted just for the year of transfer.

This observation may lead to uncertainty in pending matters associated with possession of the asset in which the possession of capital asset has been considered valid for the act of ownership. Though given the existing language in the sense of the term transfer under Section 2(47) of the Act, it is very obvious that a shift of property excluding the receipt of consideration or enrollment would yet lead to a transfer by virtue of Section 53A of Transfer of Property Act, 1882.