| COURT: | Bombay High Court |
| CORAM: | A. A. Sayed J, S. C. Dharmadhikari J |
| SECTION(S): | 45, 48 |
| GENRE: | Domestic Tax |
| CATCH WORDS: | capital gains, FSI, TDR, Transferable Development Right |
| COUNSEL: | Ajay Singh |
| DATE: | December 11, 2014 (Date of pronouncement) |
| DATE: | December 17, 2014 (Date of publication) |
| AY: | 2007-08 |
| FILE: | Click here to download the file in pdf format |
| CITATION: | |
| S. 45/ 48: Gains on sale of TDR received as additional FSI as per the D. C. Regulations has no cost of acquisition and is not chargeable to capital gains | |
Only an asset which is capable of acquisition at a cost would be included within the provisions pertaining to the head “Capital gains” as opposed to assets in the acquisition of which no cost at all can be conceived. In the present case as well, the situation was that the FSI/TDR was generated by the plot itself. There was no cost of acquisition, which has been determined and on the basis of which the Assessing Officer could have proceeded to levy and assess the gains derived as capital gains. It may be that subsection (2) of section 55 clause (a) having been amended, there is a stipulation with regard to the tenancy rights. However, even in the case of tenancy right, the view taken by the Hon’ble Supreme Court, after the provision was substituted w.e.f. 1st April, 1995, is as above. The further argument is that the tenancy rights now can be brought within the tax net and in the present case the asset or the benefit is attached to the property. It is capable of being transferred. All this may be true but as the Hon’ble Supreme Court holds it must be capable of being acquired at a cost or that has to be ascertainable. In the present case, additional FSI/TDR is generated by change in the D. C. Rules. A specific insertion would therefore be necessary so as to ascertain its cost for computing the capital gains. Therefore, the Tribunal was in no error in concluding that the TDR which was generated by the plot/property/land and came to be transferred under a document in favour of the purchaser would not result in the gains being assessed to capital gains.
i wonder how such great Revenue officers are functioning is indeed a big black mark on the great finance ministry under great Arun Jaitley, he need to look into as he is supposed to be a good advocate himself.
see in OM Kumar and Ors v Union of india (2001) SCC 386 very rightly discussed on Administrators say IAS officers and some were punished even CJI O chinnappa reddy report on the issue was considered which pin pointed the officers defects and recommended for proper punishments though UPSC made some favorable comments on officers and the court felt some thing very bad deficiency… then dept of personnel swung into action as also home ministry…pls read the whole case you people can perhaps understand.
Art 226 by judicial review may also punish the senior IAS kind officers even the retd officers, so the dept of revenue officers can equally be punished if the violate the law under which they operate… it is high time hon high courts need to direct the ITATs too if they are lenient on Revenue officers.
I wonder how a fact finding tribunals become one to form constitutional tribunals ie these tribunals are considering the interpretation of laws, is it not funny, why judicial custodian courts abdicate their responsibility like the legislature seems to abdicate their responsibilities when Executive behaves over board!
I say it is high tome legislatures as also judiciary boldly take decisions on the erratic Executive…though these worthies protected under Art 311, but yet their services could be dispensed with if they consistently act against the law that controls them, it is a settled law that statutory law is the substantial law the rules framed by Executive under delegation of powers after all rules are subservient to basic Acts…sorry to fir,y say in the very interest of the very Executive… Executive need to work under fetters please in any democracy!
please do not mistake me any right law over rules if law i mean statute if wrongly created like NTT Act would be declared ultra vires and made non est by the custodian courts that is the expectation of the citizens of any democratic country… custodian courts need not be shy to obliterate wrong statutes even when so the great subordinate delegated powers manipulated by Executive for any of their private reasons that way Wednesbury principles of unreasonableness as also proportionality principles do work against any Administrator public servants of any level please.
such action by legislature and custodian courts need to assert on incalcitrant executives if they behave incalcitrantly.
in an eliptical world everything is eliptical , definitely led to distortions…notifications by delegated legislation should be very carefully prepared so also sections too ,law making is not a pastime of some retired people but should be meaningful, else under doctrine of severability sever such distorted acts or secs or if the very Act is full of such it is better such Acts should be controlled by legislature forthwith if not judiciary without looking at consequences simple declare void ab initio;
see today the NTTv Madras Bar Association 5 bench judgement declaring NTT Act is ultra vires still government or parliament in spite of Art 141, have not taken action to duly mend the Act as per SC directive means some serious conflict between judiciary and government and or legislature seem to brew!
When SC held a view simply follow whatever you are or file curative petitions if not it is clear balance of power is seemed to be badly affected, see the tribunals are deciding on interpretation of statutes with most minimum expertise in them besides the the members except one judicial member y=the other is Accountant member that is sure to cause pell mell in decision making as also affecting the general peaceful life to be under Art 19 and Art 21.
whether government or/and legislature try to abridge the fundamental right if that is so government wisdom had hit some rock bottom it would appear!
in an eliptical world everything is eliptical , definitely led to distortions…notifications by delegated legislation should be very carefully prepared so also sections too ,law making is not a pastime of some retired people but should be meaningful, else under doctrine of severability sever such distorted acts or secs or if the very Act is full of such it is better such Acts should be controlled by legislature forthwith if not judiciary without looking at consequences simple declare void ab initio;
see today the NTTv Madras Bar Association 5 bench judgement declaring NTT Act is ultra vires still government or parliament in spite of Art 141, have not taken action to duly mend the Act as per SC directive means some serious conflict between judiciary and government and or legislature seem to brew!
When SC held a view simply follow whatever you are or file curative petitions if not it is clear balance of power is seemed to be badly affected, see the tribunals are deciding on interpretation of statutes with most minimum expertise in them besides the the members except one judicial member y=the other is Accountant member that is sure to cause pell mell in decision making as also affecting the general peaceful life to be under Art 19 and Art 21.
whether government or/and legislature try to abridge the fundamental right if that is so government wisdom had hit some rock bottom it would appear!