The assessee filed the return of income showing the income from business and\u00a0 capital gains\u00a0u\/s 45(2) of the Income -tax Act . In the course of the assessment proceedings\u00a0 the petitioner furnished all the relevant details including the nature of the activities undertaken, details of the flats sold and the closing stock. The assessment was completed u\/s 143(3) of the Act .\u00a0 The AO reopened the assessment on the ground that the closing stock should have been valued on the basis of market price , capital gain was valued at taking higher value as\u00a0 cost of acquisition . Allowing the petition the Court held that\u00a0 the Capital gains are chargeable to tax when individual flats are sold and not when the land is transferred to the co-operative society formed by the flat purchasers. The flat purchasers, by purchasing the flats, had certainly acquired a right or interest in the proportionate share of the land but its realisation is deferred till formation of the co-operative society by the owners of the flats and eventual transfer of the entire property to the co-operative society.\u00a0 Accordingly considering \u00a0an overall consideration of the entire matter, it is quite evident that there was no basis or justification for respondent \u00a0to reopen the assessment . The \u00a0reasons rendered could not have led to formation of any belief that income had escaped assessment within the meaning of the aforesaid provision. \u00a0Accordingly the reassessment notices were quashed . Relied on Chainrup Sampatram v. CIT( 1953) 24 ITR 481 (SC) for the proposition that it would be a misconception to think that any profit arose out of valuation of the closing stock. (WP No 788 of 2001\u00a0 dt\u00a0 12 -06 -2020 ) (AY. 1992-93, 1993-94, 1994-95 , \u00a01995-96)<\/p>\n","protected":false},"excerpt":{"rendered":"
S. 147 : Reassessment \u2013 After the expiry of four years- Year of chargeability \u2013 Reassessment is held to be bad in law \u2013 No failure to disclose material facts .[ S. 45(1) , 45(2),143(3) ,143(1) , 148, Art .226 ] <\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[1],"tags":[],"class_list":["post-11843","post","type-post","status-publish","format-standard","hentry","category-digest"],"acf":[],"jetpack_featured_media_url":"","jetpack_shortlink":"https:\/\/wp.me\/p9S2Rw-351","jetpack-related-posts":[],"jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts\/11843","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/comments?post=11843"}],"version-history":[{"count":5,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts\/11843\/revisions"}],"predecessor-version":[{"id":16760,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts\/11843\/revisions\/16760"}],"wp:attachment":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/media?parent=11843"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/categories?post=11843"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/tags?post=11843"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}