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II. Useful Case Laws:
1. Smt. Asha George Vs. ITO, IT Appeal No. 114 OF 2012, Date of Pronouncement: 16.01.2013, High Court of Kerala
S. 54F Value of entire land apartment to building purchased cannot be considered for exemption
Section 54F is
intended to encourage construction of or acquisition of residential
house with the aid of the proceeds from the transfer of any long term
capital asset, which is not a residential house. The provision
contemplates computing the cost of the residential building, but the
value of the plot on which the farm house stands and the land
appurtenant could also be considered.
We are unable
to accept the contention of the appellant that the value of the entire
land must be considered in arriving at the value of the residential
building. We find no illegality committed by the tribunal. It is not
open to the appellant to invoke Section 54B of the Act in regard to the
rest of the land at Koothattukulam. This is for the reason that the
appellant has not been able to satisfy the requirements of Section 54B
as already noted by us in regard to the land at Ayyanthole. Therefore,
at any rate, there can be no basis for invoking Section 54B of the Act
for deducting the value of the land purchased at Koothattukulam.
(Please click here for judgment)
2. Manjit Singh Vs. Dy. CIT, IT Appeal No. 1037 (CHD.) OF 2011, Date of order: 28-09-2012, ITAT Chandigarh
Value recorded in registered sale deed cannot be sole basis for determining FMV
The ITAT,
Chandigarh ‘B’ Bench in the case of Smt. Baljinder Kaur (supra) held
that it is well settled that the concept of ‘Fair Market Value’
envisages existence of a hypothetical seller and a hypothetical buyer in
a hypothetical market. Therefore, intrinsically speaking, the
determination of ‘Fair Market Value’ of a capital asset as on 1st April,
1981 would involve an element of estimation based on relevant factors.
An ‘Agreement to Sell’ is a relevant factor in determination of ‘Fair
Market Value’, as on 1.4.1981, in the present appeal.
(Please click here for judgment)
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